Building on the previous discussion, the price structure in two-sided markets is more complex than in one-sided markets.
This stands in sharp contrast to one-sided market models, which need to set the prices above zero for consumers in order to recover costs (e.
Ebay, Google Search, Facebook, Youtube as well as almost all other advertisement-supported free services) or as its own service provider, thus operating a one-sided market model (e.
The early literature was mostly focused on price theory, explaining difference between pricing in multi-sided markets and one-sided markets by emphasizing the need to coordinate users and bring all sides on board.
By contrast, in a one-sided market, firms choose the product or service characteristics and customers' value depends only on that choice.
The economics literature on platforms and two-sided markets shows that applying insights from the analysis of one-sided markets
to two-sided markets might be misleading.
This argument is about one-sided markets and tells us nothing about the paid prioritization arrangements that broadband providers want to impose.
25) In one-sided markets, price discrimination has ambiguous effects on social welfare, and its introduction can decrease or increase social welfare.
In this case there is a "multiplier" effect, as a price increase reduces demand more than in standard one-sided markets