Advertisement

Estimating the Value Obtained from Using a Software Service Platform

Conference paper
Part of the Lecture Notes in Computer Science book series (LNCS, volume 8193)

Abstract

Service markets allow users to discover, purchase, and utilize services offered on a specific platform. As service platforms grow in number of users and variety of offerings, it raises the question of whether this phenomenon continues to benefit users. Based on a literature review, the paper identifies usability, service variety, and the number of personal connections accessible over the service platform as major determinants that contribute to the value to users. Based on survey data on the behavior of mobile service users, the relationship between user value and the determinants is analyzed and estimated. The results show positive correlations between all three determinants and the value. Using regressions, we estimate how much these determinates contribute to the user value. Mobile service users are satisfied with the usability of services of their chosen platforms, although the impact on the user value is the lowest. Users benefit the most from an increase in the number of their personal connections and the number of services they use.

Keywords

Network Effect Theory UTAUT Value Creation Service Platforms Survey Multiple Regression 

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. 1.
    Rohlfs, J.: A Theory of Interdependent Demand for a Communications Service. The Bell Journal of Economics and Management Science, 16–37 (1974)Google Scholar
  2. 2.
    Katz, M.L., Shapiro, C.: Network Externalities, Competition, and Compatibility. The American Economic Review 75(3), 424–440 (1985)Google Scholar
  3. 3.
    Economides, N.: The economics of networks. International Journal of Industrial Organization 14(6), 673–699 (1996)CrossRefGoogle Scholar
  4. 4.
    Amit, R., Zott, C.: Value Creation in E-business. Strategic Management Journal 22, 493–520 (2001)CrossRefGoogle Scholar
  5. 5.
    Lee, S., Kim, T., Noh, Y., Lee, B.: Success Factors of Platform Leadership in Web 2.0 Service Business. Service Business 4(2), 89–103 (2010)CrossRefGoogle Scholar
  6. 6.
    Davis, F.D.: Perceived Usefulness, Perceived Ease of Use, and User Acceptance of Information Technology. MIS Quarterly 13(3), 319–340 (1989)CrossRefGoogle Scholar
  7. 7.
    Venkatesh, V., Morris, M.G., Davis, G.B., Davis, F.D.: User Acceptance of Information Technology: Toward a Unified View. MIS Quarterly, 425–478 (2003)Google Scholar
  8. 8.
    Katz, M.L., Shapiro, C.: Technology Adoption in the Presence of Network Externalities. The Journal of Political Economy, 822–841 (1986)Google Scholar
  9. 9.
    Katz, M.L., Shapiro, C.: Systems Competition and Network Effects. The Journal of Economic Perspectives 8(2), 93–115 (1994)CrossRefGoogle Scholar
  10. 10.
    Farrell, J., Saloner, G.: Standardization, compatibility, and innovation. The RAND Journal of Economics, 70–83 (1985)Google Scholar
  11. 11.
    Farrell, J., Saloner, G.: Installed Base and Compatibility: Innovation, Product preannouncements, and Predation. The American Economic Review, 940–955 (1986)Google Scholar
  12. 12.
    Arthur, W.B.: Competing Technologies, Increasing Returns, and Lock-in by Historical Events. The Economic Journal 99(394), 116–131 (1989)CrossRefGoogle Scholar
  13. 13.
  14. 14.
  15. 15.
    Google Play, https://play.google.com/store/ (accessed on June 2013)
  16. 16.
    Windows Phone Store, http://www.windowsphone.com/en-us/store/overview (accessed on June 2013)
  17. 17.
    Blackberry World, http://appworld.blackberry.com/webstore/ (accessed on June 2013)
  18. 18.
    Hartman, R.S., Teece, D.J.: Product Emulation Strategies in The Presence of Reputation Effects and Network Externalities: Some Evidence From The Minicomputer Industry. Economics of Innovation and New Technology 1(1-2), 157–182 (1990)CrossRefGoogle Scholar
  19. 19.
    Church, J., Gandal, N.: Network Effects, Software Provision, and Standardization. The Journal of Industrial Economics 85–103 (1992)Google Scholar
  20. 20.
    Gandal, N.: Hedonic Price Indexes for Spreadsheets and an Empirical Test for Network Externalities. The RAND Journal of Economics 25(1), 160–170 (1994)CrossRefGoogle Scholar
  21. 21.
    Economides, N., Himmelberg, C.: Critical Mass and Network Evolution in Telecommunications. In: Toward a Competitive Telecommunications Industry: Selected Papers from the 1994 Telecommunications Policy Research Conference (1995)Google Scholar
  22. 22.
    Besen, S.M., Farrell, J.: Choosing How to Compete: Strategies and Tactics in Standardization. The Journal of Economic Perspectives 8(2), 117–131 (1994)CrossRefGoogle Scholar
  23. 23.
    Liebowitz, S.J., Margolis, S.E.: Path Dependence, Lock-in, and History. Journal of Law, Economics, & Organization 11(1), 205–226 (1995)Google Scholar
  24. 24.
    Brandenburger, A.M., Stuart, H.: Value-Based Business Strategy. Journal of Economics and Management Strategy 5, 5–25 (1996)CrossRefGoogle Scholar
  25. 25.
    Kim, H.W., Chan, H.C., Gupta, S.: Value-Based Adoption of Mobile Internet: An Empirical Investigation. Decision Support Systems 43, 111–126 (2007)CrossRefGoogle Scholar
  26. 26.
    Basole, R.C., Karla, J.: Value Transformation in the Mobile Service Ecosystem: A Study of App Store Emergence and Growth. Service Science 4(1), 24–41 (2012)CrossRefGoogle Scholar
  27. 27.
    Haile, N., Altmann, J.: Value Creation in IT Service Platforms through Two-Sided Network Effects. In: Vanmechelen, K., Altmann, J., Rana, O.F. (eds.) GECON 2012. LNCS, vol. 7714, pp. 139–153. Springer, Heidelberg (2012)CrossRefGoogle Scholar
  28. 28.
    Smedlund, A.: Value Co-creation in Service Platform Business Models. Service Science 4(1), 79–88 (2012)CrossRefGoogle Scholar
  29. 29.
    Zhu, F., Iansiti, M.: Entry into Platform-Based Markets. Strategic Management Journal 33(1), 88–106 (2012)CrossRefGoogle Scholar
  30. 30.
    Gawer, A., Cusumano, M.A.: How Companies Become Platform Leaders. MIT Sloan Management Review 49(2), 28–35 (2008)Google Scholar
  31. 31.
    Gebregiorgis, S.A., Altmann, J.: IT Service Platforms: Their Value Creation Model and the Impact of Their Level of Openness on Their Adoption. TEMEP Discussion Paper 201295 (2012)Google Scholar
  32. 32.
    Kim, J., Ilon, L., Altmann, J.: Adapting Smartphones as Learning Technology in a Korean University. Transactions of the SDPS. Journal of Integrated Design and Process Science (2013)Google Scholar

Copyright information

© Springer International Publishing Switzerland 2013

Authors and Affiliations

  1. 1.Technology Management, Economics, and Policy Program (TEMEP), College of EngineeringSeoul National UniversitySeoulSouth-Korea

Personalised recommendations