Understanding the Economics of Platforms.

Thus,where the transaction platforms referenced in Amex providean exchange service bringing buyers and sellers together,OS-intermediated platforms engage in a range of far morecomplicated intermediations that may form their own productor service markets, some of which may be transactionmarkets. Indeed, though this principleremains somewhat controversial, the Amex court madeclear that, at least in cases involving transaction platformsand alleged non-price vertical restraints directly related tothose transactions, the appropriate metric to assess allegedharm remains whether an increase in prices or a reductionin output or innovation occurred. MOST ANTITRUST PRACTITIONERS have at least a rudimentary understandingof platforms, if not from a readingor two of the Supreme Court's decisionin Amex,[1]then from the extensive andongoing investigations, cases, and ad nauseam discussionsand debates surrounding big tech platforms. Transaction providers usuallyseek greater profits through more transactions; however, thedefining consideration highlighted by Amex and the economicsliterature upon which it relies is that the value ofa provider's network on a per-user/transaction basis can beaffected by the size of the network, and in particular the sizeof the population on each side of the transaction platform. [Extracted from the article]