What separates a truly defensible business from the rest?
According to Morningstar's Allen Good and Brian Colello, it often comes down to network effects - one of the most powerful sources of economic moat.
Unlike traditional supply-side economies of scale that focus on production volume, network effects are driven by demand-side economies.
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Allen Good - An economic moat is a structural feature that allows a firm to sustain excess returns, and few sources are as powerful as a network effect. At its core, a network effect occurs when the value
