Date of Graduation
8-2023
Document Type
Dissertation
Degree Name
Doctor of Philosophy in Business Administration (PhD)
Degree Level
Graduate
Department
Information Systems
Advisor/Mentor
Varun Grover
Committee Member
Rajiv Sabherwal
Second Committee Member
Jeff Mullins
Third Committee Member
FranckSoh
Abstract
The two important roles in a platform ecosystem are platform owners and complementors that cooperate to create value through indirect network effects. To facilitate such cooperation, platforms implement platform openness to provide significant resources for their complementors. Granting complementors access to platform core resources through application programming interfaces enables complementors to access the platform’s core development assets such as built-in software functionalities, data, and the user base. This resource provision is the dominant way for platforms to “open” their platform to complementors. While platform openness has attracted scholarly attention, there is a gap in understanding the role of platform openness in complementary product innovation and improvement. This dissertation investigates the impacts of platform openness on complementary product innovation and improvement from intra-platform and inter-platform perspectives through two essays. In the first essay, we focus on how complementors adjust intra-platform complement development strategies to cope with the tension between competition and openness from platform owners. Platform owners and complementors cooperate to create value through indirect network effects. Platform owners can also compete with complementors by entering complementary markets and “crowding out” complementors. By collecting data from data companies and through web scraping techniques, we show that platform openness increases complementary product innovation and complementary product improvement with greater impacts on innovations. We also find that the positive impacts of the direct entry of platform owners are stronger when the platform is open. In addition, our results show that the positive interaction impacts of platform openness and competition from the platform owner on complementary product innovation and improvement are stronger for complementors who have experience in app development in different markets. In the second essay, we study the impacts of platform openness from an inter-platform perspective. By focusing on the tension between the platform’s pull strategies, such as platform openness, that attract complementors to focus their innovation on the platform and push strategies, such as competition strategy, that force complementors to migrate their app development focus from the platform to its rival platforms, we explore how the platform’s pull strategies and push strategies influence multihoming complementors’ multihoming strategies across multiple platforms. Using data from data companies and web scraping, we find that platform openness is attractive for multihoming complementors to allocate more efforts in developing multihoming apps and exclusive apps on the platform than on its rival platforms, particularly for complementors experienced in app development on the platform and complements with more user feedback. However, competition from the platform owner and other complementors can make an open platform less appealing to multihoming complementors. This dissertation contributes to the theoretical and practical understanding of platform openness.
Citation
Wei, J. (2023). The Role of Platform Openness in Complementary Innovation. Graduate Theses and Dissertations Retrieved from https://scholarworks.uark.edu/etd/4857