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Why Uber Is a Platform Business Worth Investing In

Published on 26 August 16

The word platform is used in many fields including technology, business and even for abstract objects. Facebook and Twitter call themselves a platform while Android and iOS also claim the same.

Wordpress is described as a blogging platform while Uber, Airbnb are also called marketplace platforms. However, most businesses fail to understand the difference when it comes to platforms. It’s much like whether you need an iPad Pro or a Surface Pro 4. The former is designed for tablet users, run on iOS while the latter, even though with tablet qualities, offers full-fledged laptop experience running Windows 10 full version.

For businesses in the taxi business, there is often a big misunderstanding about the concept of platform.

What is a Platform?

Simply put, a platform is a central infrastructure that facilitates the exchange of value between producers and consumers. It allows multiple participants to connect and interact with one another exchanging information and value. In this regard, both Uber and Android are regarded as platforms though their business model is completely different.

One thing in common is both the companies do not own any product or specific service of their own. They just provide a link to connect two parties utilizing their central infrastructure. We will take an in-depth look at the difference between the two and establish a better understanding of platforms in business.

Uber as a Platform

Uber is considered an exchange platform, which brings together consumers (passengers wanting a taxi ride) and producers (drivers of the vehicles). Convenience and reduction in consumer’s effort and time are the core value offered by this platform. Without the Uber’s service, passengers would need to call the taxi dispatch companies to book a ride. It is common to face delays, hold times and even failure to get a confirmed ride.

Uber eliminates all these complications and makes the process simple and easy for the customers. This same model works for other types of Uber clone app and many taxi booking software free for download.

The Platform of Android

Android is a platform, which connects the producers (software and app developers) with the consumers (Android device users). It equips developers with resources (SDK) and integrated development environment (IDE) to build applications and innovate based on its infrastructure.

It reduces the transaction cost of developers by facilitating software development and its distribution. Its value lies in the ability to provide a suitable base which can be innovated.

The Major Difference

The major difference of both platforms lies in their core value. Businesses like Uber, Facebook, TripAdvisor bring together consumers and producers through their platform and gives a foundation to conduct business. Android and iOS provide the working environment and tools to develop products and services based on it.

The former type offers value by making direct exchange possible between producers and consumers. For the latter, they derive value by enabling developers to create their own content and publish it to a large audience base.

Difference in Strategy and Operation

The basic difference of the platforms leads to different strategies adopted by the businesses. Uber makes it really easy for the drivers to join after they meet the requirements. They have their smartphone with Uber clone app and can start earning instantly.

Android, on the other hand, always strives to provide better resources and support to attract more developers. Their objective is to provide the developers a way to create applications for Android in an easy and cheap way.

Though the core values are different, both platforms depend on the participation of producers and consumers. While one enhances the exchange of direct business, the other provides an infrastructure for production and distribution of applications, which generate business and revenue.

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This blog is listed under Development & Implementations Community

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