Platform Companies and Their Effects on Contemporary Business Environment

The Business Environment
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Critically assess the key features and issues related to platform companies. What is their effect on the contemporary business environment?
The business world has changed significantly in this era of globalization. The business environment is shifting, leading to a new way of doing things. Businesses have come up with different models to meet capture the market. Technology has played critical in the way businesses offer their services. Some of the businesses that use technology-based models include platform companies. These are businesses that utilize technology to connect clients with sellers and creators with consumers. In other words, platform companies facilitate exchanges between two or more independent groups, particularly consumers and producers.
Platform companies lead to the creation of large networks. For businesses to make that happen, they create large networks of users and resources that parties can access on demand (Ruggieri et al., 2018). The network increases as more people sign up to access the services offered by the producers or creators. The growth of the network is critical in allowing the creators or producers to make more profits. For instance, as more users sign up for YouTube, content creators stand to benefit. At the same time, the users benefit from the large network because they can access more products cost-effectively. The network effect is critical in growing the industry further. As more people join the platform, this facilitates the growth of the market available.
Additionally, platform companies have led to extensive reliance on big data. The companies have huge data obtained from both producers or creators and users (Purcell, 2014). The businesses use the data to determine the needs of the people on their platform. For instance, using big data, a company like Uber can determine the most appropriate driver for a particular user. Using algorithms, businesses leverage big data to make major decisions that make the experience of the clients better. Platform companies have demonstrated that the use of bi...