Habitat Traps in Mobile Platform Ecosystems

Nargis Pervin, Narayan Ramasubbu and Kaushik Dutta

Production and Operations Management, 2019, vol. 28, issue 10, 2594-2608

Abstract: Even with the rapid proliferation of applications (“apps”) running on smart handheld devices, achieving success in mobile platform ecosystems is challenging for developers because of the heavily crowded marketplaces and easy substitutability of apps. In this study, we draw inspiration from biological ecosystems research and from the operations management literatures on software production, product management, and digital platforms to empirically examine the sustainability of newly launched apps in the Apple and Google mobile platform ecosystems. In the ecology literature, a “habitat trap” refers to the instinctive but detrimental behavioral response which can potentially lead to the extinction of organisms facing dynamic changes in their habitats. Applying the habitat traps concept to mobile platform ecosystems, we investigate whether seemingly beneficial actions of app developers can indeed become detrimental to the sustainability of their apps. Using lifecycle data of 57,117 newly launched paid apps, we examine the impact of five developer actions (updating the apps, offering price promotions, and diversifying into functional variants, similar apps, and other platforms) on the sustainability of the apps. The results of our analysis show that while frequent app updates are beneficial, engaging in price promotions and diversification‐oriented activities indeed have the risks of turning into traps for developers. We utilize the empirical results to draw attention to the heterogeneity of traps in mobile platform ecosystems, shed light on the need to develop strategies for overcoming the traps, and discuss the implications of the presence of platform traps for emerging theories on digital ecosystems.

Date: 2019
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