In this case, pricing has all the standard issues associated with two sided markets (ARMSTRONG, 2006; ROCHET & TIROLE, 2006).
7) See ARMSTRONG (2006), ROCHET & TIROLE (2006) for an introduction to two sided markets.
Two sided markets
applied to telecoms would mean that, downstream, there is a relationship between ISPs and consumers, and, upstream, possibly but optionally, contractual relations between ISPs and content or online service providers to offer enhanced managed services.
Pricing strategies are also important since two sided markets work because the catalyst often subsidizes one customer group in order to attract the other.
Catalyst Code also debunks many traditional business school theories on pricing, in particular, and illustrates how the application of conventional management theories spells disaster for catalysts and two sided markets
They argue that, from a theoretical point of view, it is impossible to apply Coase's theorem (1960) to two sided markets, since the transaction between sellers and buyers takes place only if there is a platform.
A first insight is afforded by the impact of externalities on price structure, which is not neutral in two sided markets.
Price regulation and interconnection in two sided markets
This paper attempts to offer a strategic guide to two sided markets, and to identify the difficulties for competition and regulatory policy with regard to the features of two-sided markets.
As a result, we show that competition policy tools can be modified by such features of two sided markets.
In two sided markets, on the other hand, the role of the reciprocal access charge is modified since this charge makes it possible to determine price allocation.