Cocreation of Value in a Platform Ecosystem: The Case of Enterprise Software

Citation:

Ceccagnoli, M., Forman, C., Huang, E. & Wu, D. (2012). “Cocreation of Value in a Platform Ecosystem: The Case of Enterprise Software”. In MIS Quarterly, 36 (1), 263-290. Minneapolis: University of Minnesota. Retrieved May 11, 2020 from https://www.jstor.org/stable/41410417

Work data:

ISSN: 2162-9730

Type of work: Article (academic)

Categories:

ICT Infrastructure

Tags:

ecosystems

Abstract:

It has been argued that platform technology owners cocreate business value with other firms in their platform ecosystems by encouraging complementary invention and exploiting indirect network effects. In this study, we examine whether participation in an ecosystem partnership improves the business performance of small independent software vendors (ISVs) in the enterprise software industry and how appropriability mechanisms influence the benefits of partnership. By analyzing the partnering activities and performance indicators of a sample of 1,210 small ISVs over the period 1996–2004, we find that joining a major platform owner’s platform ecosystem is associated with an increase in sales and a greater likelihood of issuing an initial public offering (IPO). In addition, we show that these impacts are greater when ISVs have greater intellectual property rights or stronger downstream capabilities. This research highlights the value of interoperability between software products, and stresses that value cocreation and appropriation are not mutually exclusive strategies in interfirm collaboration.