The Platform Ecosystem Paradox: The Implications of App-Platform Integration Design

This project is a part of a long-term study that investigates how different types of relationship betweenapps and the platform affect the survival and sustainability of the platform ecosystem. We draw on thebiology literature to understand how these different types of relationship may lead to different outcomes(e.g., mutualism, commensalism, parasitism, etc.).Software platform ecosystems, such as Apple’s iOS and Google’s Android, are emerging as thedominant model for software-based services. Leveraging the advantage of their extensible technologicalarchitectures, platforms extend their product boundaries by attracting large numbers of third-partyapplications that create complementary value. To accelerate third-party development in ecosystems,platform owners have given up their integration requirements on apps’ functionality extensions to leaveapps more autonomy in development.On the other hand, prior studies in the product line strategy literature have shown that properintegration of new products (i.e., new apps in our case) with the existing product (i.e., platform in our case)could deliver extra value to the new products, existing products, and end-users. The proposed study aimsto investigate this critical tension between apps’ developmental autonomy and integration with platforms.We draw upon the principle of entitativity in information processing to investigate how users perceptuallygroup platform and apps together through app-platform integration design and how this perception activatesspillover usage between platform and apps. Particularly, the study focuses on two essential app-platformintegration designs driven from spatial and temporal dimensions of entitativity perception: spaceembeddedness and responsiveness.We propose to conduct two studies utilizing two distinct methodologies. In Study 1, we will examineactual platform and app usage from a popular web browser platform (Firefox). In Study 2, we will extendthe empirical results by conducting a field experiment in which the key constructs of interests will bemanipulated.To this end, we have collected partial panel data from Firefox. Preliminary analysis provided somesupport for our predictions. We have also contacted a social network site in China and have gained supportfrom the company to conduct a field experiment using their site.To our knowledge, our study will be the first to empirically test a theoretical framework and explainhow a symbiotic relationship between platform and apps can be achieved. The study will also contribute topractice by providing specific guidelines on how software platforms can leverage integration designsprinciples to achieve a stronger spillover effect and build a more sustainable ecosystem.