Software platforms are extensible systems built on a core-periphery model, where the platform owner provides a foundational code base that third-party developers can leverage for complementary apps. This model incentivizes software platform owners to enlarge the overall value generated by the ecosystem, thereby increasing their share of the revenues, rather than competing directly with third-party developers by offering apps themselves. As part of this strategy, platform owners nevertheless intermittently expand their core to cover functionality that has once resided in the periphery. What are the drivers behind such core expansion into ecosystem niches? We meticulously assembled a large-scale data set of all Apple’s core expansions on the iOS platform from 2012 to 2020, encompassing both stand-alone apps and features integrated into the core, to examine these drivers. The findings support our hypotheses that niches characterized by low user satisfaction, low levels of innovation efforts, and higher market concentration are more likely to be targets for core expansion. Core expansion through stand-alone apps manifests in niches with low levels of innovation efforts, whereas core expansion through integration of features into the platform core manifests in niches with low user satisfaction and high market concentration. Our study extends the software platform literature by hypothesizing and testing the drivers behind a platform owner’s core expansion into ecosystem niches.
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Verfasser hier: Forderer, Jens
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