by
Qingyuan Yue, University of Southern California
Wednesday, Nov 21, 2018 | 2:00pm-3:30pm | Room 335, HSBC Business School Building
Abstract
We investigate the impact of platform-level competition surrounding the emergence of a dominant technological platform on complementors’ decisions to move across platforms. When the installed base of a late-entrant platform surpasses the installed base of the initial incumbent platform, it creates anxiety among complementors on the incumbent platform over the rival (late) entrant platform’s emergence as the dominant one and in turn increases their migration likelihood. However, when sales revenues do not proportionally increase, the installed base alone does not necessarily indicate competitive advantages. Such a condition may instead indicate the strategic differentiation of multiple platforms and consequently reduce the migration tendency. We test our theory in the empirical settings of Apple’s iOS and Google’s Android platforms and their respective populations of app developers from 2008 to 2014. Consistent with our argument, we find that the increasing gap between installed bases of Android and iOS has an inverted-U effect on iOS developers’ likelihood of moving to Android. App developers that perceive a less-suitable fit with the iOS platform are the primary contributors to the inverted-U shaped mobility pattern. Additionally, iOS developers that migrated to Android during the rush period experience a high rate of product failure.
