Optimum Positioning of Network Platforms on a Plane.

The paper presents a study of equilibrium in a two-sided market for network platforms with cross externalities between buyers and sellers. The proposed model is a generalization of Armstrong's (2006) monopoly model for the case of a duopoly in a two-sided market for network platforms located on a plane. The paper solves the problem of optimal pricing and investigates the question of the optimal location of platforms in the market, provided that the heterogeneous utility of agents of both groups (buyers and sellers) is formed taking into account the Hotelling specification with the Manhattan metric. [ABSTRACT FROM AUTHOR]