Digital business models are becoming more common and are paving the way to the future of business; their design as networks, platforms, or ecosystems is inherently digital. This type of business model depends on network effects-when an increase of users of a network, platform, or ecosystem ultimately benefits new users, established users, and the whole network, platform, or ecosystem. This textbook explores what network effects are, how they work, how to create them, and the specific governance choices necessary to form them. Drawing on quantitative and qualitative elements, economics and managerial studies, and a large number of examples, this text seeks to analyze and configure networks, platforms, and ecosystems and emphasize the pivotal role of data in the network economy. This book will provide both students and professionals with valuable knowledge and practical insights for understanding the world of digital platforms. Chapter 3 explores how prices are set in networks, specifically prices the sponsor sets for people to join and use the network. Network pricing primarily depends on two things: how much a person benefits from the network and the sponsor''s goal of increasing reach. Balancing these two elements results in a multi-layered pricing system. Ultimately, pricing is a discovery process-suppliers learn consumers'' value assessments, and consumers discover suppliers'' cost structures. The market as a feedback mechanism, the concept of supply and demand, and price elasticity are all explored in this chapter. Various pricing models are outlined and compared, and typical phenomena for digital networks are discussed (e.g., subsidization, differentiation, and dynamization of prices).