Facilitate relationships between users and 3rd-party developers
Platforms build the core foundations necessary for an entire ecosystem to be built on top, thereby facilitating relationships between users, 3rd-party developers, and the platform. It not only makes the app-layer development technically easier but also economically justifiable. Platforms typically monetize via transaction fees (akin to taxing the economy built on top) but also sometimes advertising.
Microsoft, Apple, Shopify
Platforms are the foundation upon which entire ecosystems are built. They maintain the core infrastructure that makes it far easier for all other participants including end users, developers, and other infra providers to build their solutions and be economically empowered.
The most famous example is Microsoft, which built the OS for PC manufacturers, APIs for developers, and user interface for end users. All three groups not only benefited (developers could write applications that made PCs useful to users), but needed this underlying enabler because without it each of their individual actions wouldn’t be economically justifiable.
To make the difference between a platform and an aggregator clear, most platforms are indispensable to the functioning of the ecosystem. With Windows, developers can’t write applications for another operating system and users couldn’t use a different OS if they wanted the most popular apps. Whereas, users can switch away from aggregators by something as easy as going to a different website (e.g. Bing or Vrbo).
A way to visualize the difference:
https://stratechery.com/2018/the-moat-map/
https://stratechery.com/2019/a-framework-for-regulating-competition-on-the-internet/
https://www.platformaeronaut.com/p/decoding-the-restaurant-tech-stack?triedRedirect=true
https://www.acquired.fm/episodes/microsoft
https://www.michaeldempsey.me/blog/2025/10/03/sequencing-vs-equal-odds-applied-research/
The more internalized the network effect is (ie the more the network is the product itself), the more the platform tends to commoditize its suppliers. Whereas, for externalized platforms, the network is the ecosystem of developers built on top of the technology and so it’s key to the business model to support and help differentiate those suppliers.
https://stratechery.com/2018/the-moat-map/
The name “platform” is a descriptive one: it is the foundation on which entire ecosystems are built. The most famous example of a platform — one with which regulators are intimately familiar — is Microsoft Windows. Windows provided an operating system for personal computers, a set of APIs for developers, and a user interface for end users, to the benefit of all three groups: developers could write applications that made personal computers useful to end users, thanks to the Windows platform tying everything together.
What is critical to note about Windows, though — and this extends to newer platforms like iOS and Android — is that it was essential for the ecosystem to function. Developers could not write applications for another operating system if they wanted to reach users, and users could not use a different operating system if they wanted to use popular applications.
Aggregators are different. This is how I illustrate them:
“Aggregator” is also descriptive: Aggregators collect a critical mass of users and leverage access to those users to extract value from suppliers. The best example of an Aggregator is Google. Google offered a genuine technological breakthrough with Google Search that made the abundance of the Internet accessible to users; as more and more users began their Internet sessions with Google, suppliers — in this case websites — competed to make their results more attractive to and better suited to Google, the better to acquire end users from Google, which made Google that much better and more attractive to end users.
Notably, unlike platforms, Google is not essential for either end users or 3rd party websites. There is no “Google API” that makes 3rd party websites functional, and there are alternative search engines or simply the URL bar for users to go directly to 3rd party websites. That Google is so influential and profitable is, first and foremost, because end users continue to prefer it.
Here is a way to visualize the difference:
To be clear, both roles can be beneficial — platforms make the relationship between users and 3rd-parties possible, and Aggregators helps users find 3rd-parties in the first place — and both roles can also be abused.
https://stratechery.com/2019/a-framework-for-regulating-competition-on-the-internet/
This is ultimately the most important distinction between platforms and Aggregators: platforms are powerful because they facilitate a relationship between 3rd-party suppliers and end users; Aggregators, on the other hand, intermediate and control it.
https://stratechery.com/2019/shopify-and-the-power-of-platforms/
https://www.platformaeronaut.com/p/decoding-the-restaurant-tech-stack?triedRedirect=true
https://blog.eladgil.com/p/the-3-types-of-platform-companies