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1. Questions must not ask opinions of presenters nor should they require presenters to speculate without any basis.
2. Questions must be answerable from the information included in the article.
3. Questions must relate to the lecture topic
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Didi became the world's largest ride-sharing company in 2016, reaching 25 million trips a day in China. But just as the company began to reach profitability, Meituan launched its own ride-hailing business. In April, Didi struck back by entering the food delivery market in Wuxi, close to Shanghai. The factors affecting the growth and sustainability of platform firms differ from those of traditional firms. Digital platforms' competitive advantage hinges more on the interplay between the platform and the network it orchestrates.

In digital networks, bottlenecks to value creation and growth aren't tied to human or organizational factors. When network effects are strong, the value provided by a platform continues to rise sharply with the number of participants. Video game consoles, however, exhibit only weak network effects. This is because video games are a hit-driven business, and a platform needs relatively few hits to be successful. It is possible for firms to design features that strengthen network effects.

Amazon, for example, has built multiple types of effects into its business model. The more fragmented a platform business is, the less likely it is to sustain its scale. Any real challenger to Airbnb would have to enter the market on a global scale. Facebook and WeChat have been enhancing their networks by getting popular brands and celebrities to create public accounts. This creates a denser, more global, integrated network, which is easier to defend from competition.

Some platforms try to avoid disintermediation by enhancing the value of conducting business on them. But those services become less valuable once trust develops among platform users. Alibaba's Taobao e-commerce platform didn't charge listing or transaction fees. EachNet charged sellers transaction fees and didn't allow direct interactions. ZBJ, which launched in 2006 with a model of charging a 20% commission, is now valued at more than $1.5 billion.

When disintermediation is a threat, providing complementary services can work a lot better than charging transaction fees. Multi-homing happens when users or service providers form ties with multiple platforms. Uber and Lyft reward riders for completing a certain number of trips in a row without rejecting or canceling any. While rides are in progress, both platforms provide drivers with requests for pickups very close to current passengers' drop-off locations. Success hinges on acquiring a high number of users and amassing data on their interactions.

By leveraging them, firms that have succeeded in one industry vertical often diversify into different lines of business. This is a fundamental reason why Amazon and Alibaba have moved into so many markets. Alipay remained attractive to consumers and merchants because of its tight bridging with Alibaba's other services. Didi and Uber face rampant multi-homing, which may worsen as rivals enter the markets. Platforms are becoming crucial hubs in the global economy. Entrepreneurs should analyze the basic properties of the networks it will use and strengthen network effects.