Participation in a Platform Ecosystem: Appropriability, Competition, and Access to the Installed Base

Peng Huang (), Marco Ceccagnoli (), Chris Forman () and D.J. Wu ()
Additional contact information
Peng Huang: College of Management, Georgia Tech, http://mgt.gatech.edu/directory/phd/huang/
Marco Ceccagnoli: College of Management, Georgia Tech, http://mgt.gatech.edu/directory/faculty/ceccagnoli/
Chris Forman: College of Management, Georgia Tech, http://mgt.gatech.edu/forman/
D.J. Wu: College of Management, Georgia Tech, http://mgt.gatech.edu/directory/faculty/wu/

No 09-14, Working Papers from NET Institute

Abstract: In this study we examine the antecedents of small independent software vendor (ISV) decisions to join a platform ecosystem. Using data on the history of partnering activities from 1201 ISVs from 1996 to 2004, we find that appropriability strategies based on intellectual property rights and the possession of downstream complementary capabilities by ISVs are positively related to partnership formation, and ISVs use these two mechanisms as substitutes to prevent expropriation by the platform owner. In addition, we show that greater competition in downstream product markets between the ISV and the platform owner is associated with a lower likelihood of partnership formation, while the platform’s penetration into the ISV’s target industries is positively associated with the propensity to partner. The results highlight the role of innovation appropriation, downstream complementary capabilities, and collaborative competition in the formation of a platform ecosystem.

Keywords: platform ecosystem; partnership; intellectual property rights; downstream capabilities (search for similar items in EconPapers)
JEL-codes: L26 L86 O33 O34 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2009-09, Revised 2009-09
New Economics Papers: this item is included in nep-com, nep-ino, nep-ipr, nep-pr~ and nep-net
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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