02.174TS The Design of Digital Platforms
This course is dedicated to comprehending the intricacies of digital platform, focusing on the economics of multi-sided platforms as exemplified by industry giants such as Alibaba, Amazon, Apple, Google, Meta, Microsoft, and Tencent. In contrast to traditional businesses, these platforms operate on network effects and data-driven models, presenting distinctive economic and strategic challenges. The course will utilize basic game theory and industrial organization models to guide students through the entire lifecycle of digital platform design and operation. This module combines theoretical models and empirical applications to provide cutting-edge and application-oriented instruction.
Learning Objectives
After successful completion of the subject, students will be able to:
- Grasp the distinctive features that differentiate digital multi-sided platforms from conventional businesses.
- Understand the operational mechanisms underpinning these platforms.
- Develop the ability to conduct basic data analysis based on theoretical models.
- Analyse and formulate strategies essential for effective platform design.
Measurable Outcomes
Students are expected to:
- Participate in weekly in-class exercises that explore and compare the features of digital platforms with traditional businesses.
- Analyse the implementation of operational mechanisms underpinning digital platforms through group presentation on real-world platform.
- Demonstrate understanding of digital platforms and their operational mechanisms through a midterm examination.
- Demonstrate effective platform design based on the formulation of strategies and models through group presentation.
Assessment
| Assessment | Percentage |
| WEC – Attendance and class participation | 10% |
| WEC – Weekly group presentation | 15% |
| WEC – Midterm | 30% |
| WEC – Final group presentation | 30% |
| WEC – Individual report | 15% |
(WEC: Writing, Expression, Communication)
Exams
The two-hour midterm exam will be open-book and will cover all material studied up to Week 6.
Weekly Schedule
Week 1: Introduction to Multi-Sided Platforms
Week 2: Introduction to Network Effects
Week 3: Application of Network Effects: Rating, Review and Recommendation
Week 4: Pricing Structure of Multi-Sided Platforms
Week 5: Marketplace vs. Reseller
Week 6: Platform Launch Strategies: Chicken-and-egg Issue
Week 7: Recess Week
Week 8: Midterm
Week 9: Platform Expansion: From Product to Platforms
Week 10: Potential Challenge: Leakage
Week 11: Advanced Design: Steering
Week 12: Policy Implementation
Week 13: Final Project Presentations