The behavior-based discrimination price model (BBPD) needs to collect a large amount of user information, which would spark user privacy concerns. However, the literature on BBPD typically overlooks consumer privacy concerns. Additionally, most of the existing research provides some insights from the perspective of traditional privacy protection measures, but seldom discusses the role of quality discrimination in alleviating users’ privacy concerns. By establishing a Hotelling duopoly model of two-period price-quality competition, this paper explores the impact of quality discrimination on industry profits, user surplus, and social welfare under user privacy concerns. The results show that, with the increase of user privacy cost, given weak market competition intensity, quality discrimination can increase users’ surplus and social welfare, thereby alleviating users’ privacy concerns. We then discuss the managerial implications for alleviating consumer privacy concerns. In addition, we take Airbnb as an example to provide practical implications.

In the era of big data, consumer group privacy has become an important source of revenue for the digital platform. Considering the situation that the platform collects consumer group data privacy to generate business revenue, we explore how the service matching level and commission rate affect the platform revenue, social welfare, and seller benefits. Based on the theory of group privacy, the three-party equilibrium evolution is solved by constructing a sequential game model including platform, seller, and consumer alliance. It is found that when the service matching level of the platform is greater than the threshold value, there are two main situations: on the one hand, if using the data privacy of a consumer group is subject to market regulation, the platform will set a high commission rate and service matching level in order to maximize profit. However, social welfare and seller’s business benefit both reach a minimum in this case, and the three-party game cannot attain equilibrium. On the other hand, when the market governor relaxes the platform’s regulation on the use of consumer group privacy data and data revenue efficiency is high enough, the platform can maximize the revenue by increasing the service matching level and reducing the commission rate. The optimal commission rate depends on the data revenue efficiency of the platform. Moreover, when the platform sets the highest commission rate and the service matching level is at a medium level, a stable partial equilibrium among the three-party will be achieved. These conclusions can give some insights into platform’s business model choice decision.

With the rapid development of information technology, digital platforms can collect, utilize, and share large amounts of specific information of consumers. However, these behaviors may endanger information security, thus causing privacy concerns among consumers. Considering the information sharing among firms, this paper constructs a two-period duopoly price competition Hotelling model, and gives insight into the impact of three different levels of privacy regulations on industry profit, consumer surplus, and social welfare. The results show that strong privacy protection does not necessarily make consumers better off, and weak privacy protection does not necessarily hurt consumers. Information sharing among firms will lead to strong competitive effects, which will prompt firms to lower the price for new customers, thus damaging the profits of firms, and making consumers’ surplus higher. The level of social welfare under different privacy regulations depends on consumers’ product-privacy preference, and the cost of information coordination among firms. With the cost of information coordination among firms increasing, it is only in areas where consumers have greater privacy preferences that social welfare may be optimal under the weak regulation.

The benign consumption of two-sided markets and the quality improvement of the supply side is the core of the sustainable development of platform ecology. This paper discusses how the platform uses personalized service values to influence the decision making of manufacturers and consumers, thus improving the health development of the platform ecosystem. By constructing the vertical differentiation model, we find that, different from the unified pricing strategy in the benchmark market, manufacturers in the platform market can implement personalized pricing, according to the different types of consumers’ quality preferences. When the platform service value is less than the product cost difference between manufacturers, low-quality manufacturers may benefit from the platform. Meanwhile, when the platform service value is greater than the product cost difference between manufacturers, the lemon market may appear and platforms should set the differentiated subsidy strategy according to the type of market consumers; this is a dominant strategy. In addition, when the number of consumers with low-quality demand in the market is large, the platform’s subsidies for high-quality products to consumers will guide consumers to buy high-quality products; this will not only promote the development of the benign market, but also improve the platform’s revenue. Finally, the sensitivity analysis shows that the platform service value has a U-shaped impact on the platform revenue and an inverted U-shaped impact on the manufacturers’ revenues.