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| Topic: |
Technology
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| Number of pages / Number of words: |
3 / 754 |
Essay's paper body
The binding contract of the auction is between the winning bidder and the seller only
Because access to the online trade channel (i.e. Internet) is universal, and the physical assets required to setup an auctioning site are all commercially available, barriers to entry in the auctioning industry are minimal...
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What comes stronger into play is the network externalities effect, as was mentioned before.
Being in a market with huge network externalities makes it extremely difficult for a competitor to get a large share of the userbase, since most users tend to gravitate towards the service which already offers the most users (since it will presumable have the greatest number of offerings...
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