A Network Effect occurs when separate entities conglomerate to provide for a much larger, singular purpose that involves several individual aspects that essentially become planks of the platform. An example of this provided in the reading would be the creation of the highway system, a physical platform, due to the increase of car sales. This ultimately leads to the transportation of products being done through 18-wheelers and mail trucks, a result of the networking created by mass car purchasing.

The Network Effect also allows for platforms to become exponentially more popular as they become more popular. It vastly increases their rates. This is why Facebook added their second million users with far more ease than their first million. In a way, it creates a standard which is the new jumping point for the platform as they increase their networking by adding more planks.