Digital platform (infrastructure)

Based on governance principles that can evolve, platforms shape how their users orchestrate digital resources to create social connections and perform market transactions. Digital platforms typically rely on big data stored in the cloud to perform algorithmic computations that facilitate user interactions. For instance, algorithms can be designed to analyze a user's historical preferences to provide targeted recommendations of new users with whom to connect or of new content likely to be of interest.

Platforms can be multisided, meaning that qualitatively different groups of users come to the platform to be matched with each other, such as buyers with sellers of goods, developers with users of applications, or consumers with advertisers. Digital platforms can thus act as catalogs, as marketplaces, as mediators, and as service providers, depending on their focus and the groups of users that they manage to attract. Platform operations are such that platform organizations “connect-and-coordinate” more often than they “command-and-control”.{{Cite journal|last1=Tilson|first1=David|last2=Lyytinen|first2=Kalle|last3=Sørensen|first3=Carsten|date=2010-11-18|title=Research Commentary—Digital Infrastructures: The Missing IS Research Agenda|url=https://pubsonline.informs.org/doi/abs/10.1287/isre.1100.0318|journal=Information Systems Research|volume=21|issue=4|pages=748–759|doi=10.1287/isre.1100.0318|s2cid=5096464 |issn=1047-7047}}

Digital platforms orchestrate many aspects of our lives, from social interactions to consumption and mobility.{{Cite journal|last=Kenney M, Zysman J|date=2016|title=The Rise of the Platform Economy|url=https://issues.org/the-rise-of-the-platform-economy|journal=Issues in Science and Technology}}{{Cite journal|last1=de Reuver|first1=Mark|last2=Sørensen|first2=Carsten|last3=Basole|first3=Rahul C.|date=2018|title=The Digital Platform: A Research Agenda|journal=Journal of Information Technology|language=en|volume=33|issue=2|pages=124–135|doi=10.1057/s41265-016-0033-3|s2cid=13591491|issn=0268-3962|doi-access=free}} That's why law and technology scholar Julie E. Cohen described the digital platform as "the core organizational form of the emerging informational economy" that can, in some circumstances, replace traditional markets.{{Cite journal|last=Cohen|first=Julie|date=2017|title=Law for the Platform Economy|url=https://lawreview.law.ucdavis.edu/issues/51/1/Symposium/51-1_Cohen.pdf|journal=UC Davis Law Review|volume=51}}

While measuring the size of the platform economy in absolute terms is notably difficult due to methodological disagreements,{{Cite web|title=The pandora's box of the platform economy|url=https://www.eurofound.europa.eu/publications/blog/the-pandoras-box-of-the-platform-economy|access-date=2021-03-13|website=Eurofound|language=en}} there is consensus that revenues derived from digital platform transactions have been growing rapidly and steadily over the past twenty years, with the World Economic Forum estimating the growth to be 15-25% a year in emerging markets.{{Cite web|last=World Economic Forum|date=2015|title=Expanding Participation and Boosting Growth: The Infrastructure Needs of the Digital Economy|url=http://www3.weforum.org/docs/WEFUSA_DigitalInfrastructure_Report2015.pdf|url-status=live|archive-url=https://web.archive.org/web/20150404084958/http://www3.weforum.org:80/docs/WEFUSA_DigitalInfrastructure_Report2015.pdf |archive-date=2015-04-04 }} As of October 5, 2020, the five most valuable corporations publicly listed in the U.S. were all primarily digital platform owners and operators (Apple, Microsoft, Amazon, Facebook, Alphabet) and so were the top two in China (Alibaba, Tencent).{{Cite web|last=Clark|first=Ken|title=Where to Find a List of the Stocks in the S&P 500|url=https://www.investopedia.com/ask/answers/08/find-stocks-in-sp500.asp|access-date=2021-03-13|website=Investopedia|language=en}}{{Cite web|title=Global 2000 - The World's Largest Public Companies 2020|url=https://www.forbes.com/global2000/|access-date=2021-03-13|website=Forbes|language=en}}

Digital platforms also increasingly mediate the global labor markets as part of the so-called gig economy.

Due to the existence of network effects, competition among digital platforms follows unique patterns studied from multiple perspectives in the fields of economics, management, innovation, and legal studies.{{Cite journal|last1=Rietveld|first1=Joost|last2=Schilling|first2=Melissa A.|date=2020-11-27|title=Platform Competition: A Systematic and Interdisciplinary Review of the Literature|journal=Journal of Management|volume=47|issue=6|language=en|pages=1528–1563|doi=10.1177/0149206320969791|s2cid=229464181|issn=0149-2063|doi-access=free}} One of the most striking features of digital platform competition is the strategic use of negative prices to subsidize growth. Negative prices happen, for instance, when a credit card company gives consumers cashback rewards on top of a free credit card to entice merchants to join their payment network.{{Cite journal|last=Chakravorti|first=Sujit|date=2003-06-01|title=Theory of Credit Card Networks: A Survey of the Literature|journal=Review of Network Economics|language=en|volume=2|issue=2|doi=10.2202/1446-9022.1018|s2cid=201280730|issn=1446-9022|doi-access=free}} This represents a case of a platform subsidizing one side of the network (consumers) to attract users on the other side (merchants). More recently, another striking pattern has been the growing competition between centralized corporate platforms and decentralized blockchain platforms, such as the competition, in the banking sector, between traditional financial institutions and new "decentralized finance" (DeFi) ventures, or in the file hosting sector, between the likes of Dropbox, BOX, Amazon Cloud, SpiderOak, and Google Drive, on the one hand, and decentralized peer-to-peer alternative InterPlanetary File System, on the other.

Digital Platforms have a significant influence on politics, through enabling rapid information sharing which has shaped public discourse and the spread of misinformation.{{Cite journal |last=Stemler |first=Abby |date=2019 |title=Platform Advocacy and the Threat to Deliberative Democracy |url=https://ssrn.com/abstract=3024069 |journal=[MD.L.REV Kelley School of Business Research Paper] |volume=77 |issue=101 |pages=17}} Social Media Platforms, in particular such as Facebook, Google and Twitter have become instrumental to political campaigns, allowing Politicians to spread their messages across these platforms.{{Cite book |last=Vaidhyanathan |first=Siva |title=Antisocial media : how Facebook disconnects us and undermines democracy |publisher=New York : Oxford University Press.. |isbn=978-0-19-005654-4 |edition=2nd |location=New York}} These Platforms have used algorithms by analysing user behaviour and preferences to target messages toward influencing individuals.{{Cite book |last=Praiser |first=Eli |title=The Filter Bubble |date=2012 |publisher=Penguin |isbn=978-0241954522}} This has been seen in Elections such as the 2016 EU referendum where 'Political Bots' on Digital Platforms targeted older age groups with concerns on immigration for the argument that the U.K. should leave the European Union.{{Cite journal |last=Howard |first=PN |date=2018 |title=Algorithms, bots, and political communication in the US 2016 election: The challenge of automated political communication for election law and administration. |journal=Journal of Information Technology & Politics |volume=2 |issue=15 |pages=87}} The involvement of Digital Platforms on Political Campaigns has sparked lots of controversy; This has raised concerns on the impact that these Digital Platforms actually have in terms of influencing Politics. There has been discussions and laws put in place to regulate the power these Platforms have. Laws such as The Digital Services Act have been put in place to regulate and ensure Digital Programmes are abiding by content moderation, privacy, consent an data protection laws.{{Cite web |last=DSA |title=Digital Services Act |url=https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32022R2065 }}

Some of the most prominent digital platforms are owned, designed, and operated by for-profit corporations such as Google, Amazon, Facebook, Alibaba, Tencent, Baidu, and Yandex. By contrast, non-corporate digital platforms, including the Linux operating system, Wikipedia and Ethereum, are community-managed; they do not have shareholders nor do they employ executives in charge of achieving predefined goals.

Despite their notable ability to create value for individuals and businesses, large corporate platforms have received backlash in recent years.{{Cite news|date=2019-09-06|title=Facebook faces fresh anti-trust investigation|language=en-GB|work=BBC News|url=https://www.bbc.com/news/technology-49611947|access-date=2021-03-07}} Some platforms have been suspected of anticompetitive behavior,{{Cite journal|last=Dina|first=Srinivasan|date=2019|title=The Antitrust Case Against Facebook: A Monopolist's Journey Towards Pervasive Surveillance in Spite of Consumers' Preference for Privacy|url=https://lawcat.berkeley.edu/record/1128876|journal=Berkeley Business Law Journal|language=en|volume=16|issue=1}} of promoting a form of surveillance capitalism,{{Cite book|last=Zuboff|first=Shoshana|url=https://www.worldcat.org/oclc/1049577294|title=The age of surveillance capitalism : the fight for a human future at the new frontier of power|date=2019|isbn=978-1-61039-569-4|edition=1st|location=New York|oclc=1049577294}} of violating labor laws,{{Cite web|date=2020-05-05|title=California sues Uber, Lyft over alleged labor law violations|url=https://apnews.com/article/2bb73e410f91607d8bdc10f664cd20c0|access-date=2021-03-13|website=AP NEWS}} and more generally, of shaping the contours of a digital dystopia.{{Cite web|last=Tirole J|title=Digital Dystopia|url=https://www.tse-fr.eu/sites/default/files/TSE/images/conference/Digital_conf_2020/tirole_digital_dystopia_080120.pdf|url-status=live|archive-url=https://web.archive.org/web/20201218222349/https://www.tse-fr.eu/sites/default/files/TSE/images/conference/Digital_conf_2020/tirole_digital_dystopia_080120.pdf |archive-date=2020-12-18 }} The digital platforms operating in social media operate a business model that nudges content creators toward circulating disinformation.{{Cite journal |last=Diaz Ruiz |first=Carlos |date=2023-10-30 |title=Disinformation on digital media platforms: A market-shaping approach |journal=New Media & Society |volume=27 |issue=4 |pages=2188–2211 |language=en |doi=10.1177/14614448231207644 |issn=1461-4448|doi-access=free }}

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Category:Infrastructure