Paul Belleflamme

UCLouvain, LIDAM/CORE

will give a presentation on

Network goods, price discrimination, and two-sided platforms

Abstract

A monopolist sells a network good to a set of heterogeneous users. We show that the provider of the network good effectively becomes a two-sided platform if it can condition prices on some user characteristics. This still holds true, if the network operator cannot observe consumer characteristics but induces user self-selection when it offers screening contracts. In our setting all incentive constraints are slack. The use of freemium strategies emerges as a special case of versioning. Here, a base version is offered at zero price and a premium version at a positive price. Overall, the paper illustrates the close link between price discrimination in the presence of a network good and pricing by a two-sided platform.

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