The role of digital intermediation platforms in opening up international markets

Executive summary

Online platforms are a defining feature of today’s highly digital economy, reshaping how people access services, trade, and interact. Digital intermediation platforms (DIPs) – which connect buyers and sellers without taking ownership of goods or services – play a pivotal role in facilitating e-commerce and digital trade. DIPs can be "pure", solely intermediating transactions between buyers and sellers, or "hybrid", combining intermediation with direct retail or service activity and the physical infrastructure – such as warehousing or logistics. By lowering search, matching and transaction costs, DIPs facilitate cross-border e-commerce and digital trade, expanding market access for businesses, including micro, small and medium enterprises (MSMEs). Platform diffusion across countries nonetheless differs, shaped in part by domestic regulatory environments governing trade in digitally enabled services.

This paper develops new cross-country proxy indicators of DIP uptake and foreign presence across three major consumer-facing sectors – travel and accommodation booking, ride-hailing and carpooling, and business-to-consumer or consumer-to-consumer (X2C) online marketplaces – drawing on website traffic data for close to 860 platforms. Covering OECD Member countries from 2010 to 2024, it examines how regulatory measures captured by the OECD Digital Services Trade Restrictiveness Index (DSTRI) are associated with platform diffusion and the presence of foreign-headquartered firms across markets.

Main findings

DIPs are expanding, but foreign platform penetration and market concentration vary considerably across sectors

• In 2024, foreign-headquartered platforms account for an estimated 54% of traffic in travel and accommodation booking, 46% in ride-hailing and carpooling, and between 33% (pure DIPS) and 45% (pure and hybrid DIPs) in X2C online marketplaces, on average across the OECD.

• Data suggest that competition in ride-hailing and carpooling has intensified markedly since 2014; travel and accommodation booking remain competitive with no single platform exerting dominant monopoly power; and relatively limited competitive pressures on the largest online platforms (X2C marketplaces), with smaller entrants contributing little to changes in overall market structure.

Restrictions on digitally enabled services trade are associated with lower DIP diffusion, particularly for foreign-headquartered platforms

• In travel and accommodation booking, a moderate easing of restrictions on intellectual property rights (IPR) protection and enforcement (e.g. domestic rules on copyrights and trademarks, including whether foreign firms receive equal protection and whether effective mechanisms exist to enforce these rights) is associated with an 8% increase in overall platform traffic and a near 25% increase in traffic from foreign-headquartered firms.

• A moderate easing of restrictions on IPR protection and enforcement is also associated with an even larger, approximately 90%, increase in foreign platform traffic in ride-hailing and carpooling, reflecting these platforms' strong reliance on proprietary software and data.

• In X2C online marketplaces, easing restrictions on payment systems is associated with a 200% increase in traffic to foreign-owned pure DIPs and a 4% increase in their share of traffic.

• Broader regulatory measures – including local presence requirements and advertising restrictions – are associated with a 37% increase in traffic from foreign firms and a rise of 1-2 percentage points in their market share, with effects consistently stronger for pure DIPs than for hybrid DIPs.

Digital trade integration has progressed, but openness remains limited and regulatory restrictiveness is on the rise

• The OECD Index of Digital Trade Integration and Openness – trade component (INDIGO-t) indicates that the world economy had reached only around 8.5% of full digital trade integration and openness in 2024.

• DSTRI evidence points to rising overall regulatory restrictiveness over the past decade, driven mainly by measures related to infrastructure and connectivity and by a quadrupling, between 2014 and 2024, of "other" restrictions such as local presence requirements, licensing obligations and advertising limits.