One-Sided Business Models

This is the first in a series of four posts on my view on business models, more specifically the different directions for product and service refinement and monetary flow. The other posts will be on Two-Sided Business Models, Horizontal Business Models and Multi-Layer Business Models.

I refer to business models with a single direction for the monetary flow, and a single direction for product and service refinement as One-Sided Business Models. Involved actors form a value chain and activities early in the value chain are called "upstream", whereas "downstream" refers to later parts of the same value chain. The monetary flow in One-Sided Business Models flows from downstream actors to upstream actors, while digital and physical products and services are refined in the opposite direction. Value propositions are formed towards downstream actors and revenues can come from the closest actor in the chain and/or from actors further downstream.

The sophistication of value propositions can vary from the smallest technology or commodity component of a large system, to full concepts with developed brands.

I have never seen the term one-sided business model been used, as it has been the default for traditional business models. It has been described in numerous articles and books, and allmost all management literature focus on models with single directions for monetary flow, and single directions for product and service refinement. I use the term one-sided business models as a reference for my posts on Two-sided, Horizontal, and Multi-Layer Business Models.

Mobile phone operator example
To give a concrete, and simplified example, let's take a mobile phone operator. With a One-Sided Business Model, users pay for a mobile phone and services often with a subscription based and/or utility based business model. Direct services such as air time, text and video messages, email and internet access, is combined with larger concepts such as being part of an exclusive group or having constant access to online-platforms, automatic back-up, remote-erase of memory, file-storage, news, weather, games, music, movies etc. No matter the service, the user is the source of revenues for the mobile phone operator.

Further reading:
Two-sided business models
Horizontal business models
Multi-layer business models