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Cited by 273Digital Platforms and EconomicsDigital Economy and Work TransformationOpen Source Software Innovations

The Ecosystem of Software Platform: A Study of Asymmetric Cross-Side Network Effects and Platform Governance1

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Song, Peijian, Xue, Ling, Rai, Arun, Zhang, Cheng·2018·MIS Quarterly
DOI 10.25300/misq/2018/13737
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Abstract

In the context of software platforms, we examine how cross-side network effects (CNEs) on different platform sides (app-side and user-side) are temporally asymmetric, and how these CNEs are influenced by the platform’s governance policies. Informed by a perspective of value creation and capture, we theorize how the app-side and the user-side react to each other with distinct value creation/capture processes, and how these processes are influenced by the platform’s governance policies on app review and platform updates. We use a time-series analysis to empirically investigate the platform ecosystem of a leading web browser. Our findings suggest that while the growth in platform usage results in long-term growth in both the number and variety of apps, the growth in the number of apps and the variety of apps only leads to short-term growth in platform usage. We also find that long app review time weakens the long-term CNE of the user-side on the app-side, but not the short-term CNE of the app-side on the user-side. Moreover, we find that frequent platform updates weaken the CNEs of both the user-side and the app-side on each other. These findings generate important implications regarding how a software platform may better govern its ecosystem with different participants.

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  • At a certain point, the adoption rate on one side reaches its tipping point, resulting in the adoption of users on other sides of the platform to skyrocket.

    “At a certain point, the adoption rate on one side reaches its tipping point, resulting in the adoption of users on other sides of the platform to skyrocket (Song et al., 2018;Tiwana, 2014).”

    From Digital platform ecosystems in flux: From proprietary digital platforms to wide-spanning ecosystems (2023) · cites this paper as Song et al., 2018

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Authors
Song, P., Xue, L., Rai, A., & Zhang, C.
Affiliations
  • Nanjing University (CN)
  • Georgia State University (US)
  • Fudan University (CN)
ORCID
Venue
MIS Quarterly
Publisher
MIS Quarterly
Published
2018-03-01
Volume
42
Issue
1
Pages
121-142
ISSN
  • 0276-7783 (ISSN-L)
  • 2162-9730
DOI
10.25300/misq/2018/13737
OpenAlex
W1827556725
Cited by
273
References
66
Citations by year
2026: 25 · 2025: 26 · 2024: 23 · 2023: 42 · 2022: 40 · 2021: 52 · 2020: 36 · 2019: 18 · 2018: 10 · 2017: 1
FWCI
48.46
Type
journal article
Language
en
Open access
Locations
  • MIS Quarterly (publishedVersion)
  • SSRN Electronic Journal (submittedVersion)
Topics
  • Social Sciences › Business, Management and Accounting › Strategy and Management › Digital Platforms and Economics
  • Social Sciences › Sociology and Political Science › Digital Economy and Work Transformation
  • Physical Sciences › Computer Science › Computer Science Applications › Open Source Software Innovations
Keywords
software platform, cross-side network effects, platform governance, value creation, value capture

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