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Sustaining Superior Performance in Business Ecosystems: Evidence from Application Software Developers in the iOS and Android Smartphone Ecosystems

Open access
Kapoor, Rahul, Agarwal, Shiva·2017·Organization Science
DOI 10.1287/orsc.2017.1122
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Abstract

We study the phenomenon of business ecosystems in which platform firms orchestrate the functioning of ecosystems by providing platforms and setting the rules for participation by complementor firms. We develop a theoretical framework to explain how the structural and evolutionary features of the ecosystem may shape the extent to which participating complementor firms can sustain their superior performance. The structural feature, which we refer to as ecosystem complexity, is a function of the number of unique components or subsystems that interact with the complementor’s product. We incorporate the evolutionary features by considering the role of generational transitions initiated by platform firms over time as well as the role of complementors’ ecosystem-specific experience. Evidence from Apple’s iOS and Google’s Android smartphone ecosystems supports our arguments that higher ecosystem complexity helps app developers sustain their superior performance, and that this effect is stronger for more experienced firms. In contrast, platform transitions initiated by Apple and Google make it more difficult for app developers to sustain their performance superiority, and that this effect is exacerbated by the extent of ecosystem complexity. The study offers a novel account of how the performance of complementor firms in platform-based business ecosystems may be shaped by their ecosystem-level interdependencies.

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  • Multihoming complementors must determine a strategic balance in their resource investments to still serve consumer interests.

    “Hence, they must determine a strategic balance in their resource investments to still serve consumer interests (Kapoor & Agarwal, 2017).”

    From What role do data network effects play for multihoming complements? An empirical analysis of platform complementors’ strategies for consumer value creation (2025) · cites this paper as Kapoor & Agarwal, 2017

    The Additional information section (page unavailable) says that participation in both iOS and Android may create resource-allocation challenges, supporting the multihoming and investment-balance aspect. It does not say that complementors must strike that balance to serve consumer interests; the paper frames the issue around sustaining complementors’ performance. (LLM, conf=0.84)

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  • In the context of multihoming, research suggests the specialization of complements toward a particular platform ecosystem potentially has a positive effect on complement quality.

    “In the context of multihoming, research suggests the specialization of complements toward a particular platform ecosystem potentially has a positive effect on complement quality (Cennamo et al., 2018;Kapoor & Agarwal, 2017).”

    From What role do data network effects play for multihoming complements? An empirical analysis of platform complementors’ strategies for consumer value creation (2025) · cites this paper as Kapoor & Agarwal, 2017

    The Ecosystem Experience section links accumulated development experience to building a high-quality app, and Additional information notes that participation in both ecosystems may create resource-allocation challenges. However, the paper does not establish that specializing in one platform, rather than multihoming, improves complement quality; its main outcome is sustained superior performance, measured by app revenue ranking. The indexed passages provide no page numbers. (LLM, conf=0.76)

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Research works printed but not linked: 3

  1. Dutton J.M., & Thomas A.1984. Treating progress functions as a managerial opportunity. Academy of Management Review, 9(2): 235 -247
  2. Lenox M.J., Rockart S.F., & Lewin A.Y. 2007. Interdependency, competition, and industry dynamics. Management Science, 53(4): 599-615.
  3. McGahan, A. M., & Porter, M. E. 1997. How much does industry matter, really?. Strategic Management Journal, 18(6): 15-30.

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Authors
Kapoor, R., & Agarwal, S.
Affiliations
University of Pennsylvania (US)
ORCID
Venue
Organization Science
Publisher
Institute for Operations Research and the Management Sciences (INFORMS)
Published
2017-06
Volume
28
Issue
3
Pages
531-551
ISSN
  • 1047-7039 (ISSN-L)
  • 1526-5455
DOI
10.1287/orsc.2017.1122
OpenAlex
W2608822558
Cited by
453
References
76
Citations by year
2026: 58 · 2025: 60 · 2024: 55 · 2023: 64 · 2022: 54 · 2021: 59 · 2020: 50 · 2019: 23 · 2018: 20 · 2017: 5 · 2016: 4 · 2014: 1
FWCI
53.24
Type
journal article
Language
en
Open access
Locations
  • Organization Science (publishedVersion)
  • ScholarlyCommons (University of Pennsylvania) (submittedVersion)
Topics
  • Social Sciences › Business, Management and Accounting › Strategy and Management › Digital Platforms and Economics
  • Social Sciences › Business, Management and Accounting › Strategy and Management › Innovation and Knowledge Management
  • Social Sciences › Business, Management and Accounting › Strategy and Management › Business Strategy and Innovation
Keywords
business ecosystems, platform companies, ecological complexity, generational change, iOS, Android, performance sustainability, platform business models

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