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.
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsPreview
Unable to display preview. Download preview PDF.
References
Rohlfs, J.: A Theory of Interdependent Demand for a Communications Service. The Bell Journal of Economics and Management Science, 16–37 (1974)
Katz, M.L., Shapiro, C.: Network Externalities, Competition, and Compatibility. The American Economic Review 75(3), 424–440 (1985)
Economides, N.: The economics of networks. International Journal of Industrial Organization 14(6), 673–699 (1996)
Amit, R., Zott, C.: Value Creation in E-business. Strategic Management Journal 22, 493–520 (2001)
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)
Davis, F.D.: Perceived Usefulness, Perceived Ease of Use, and User Acceptance of Information Technology. MIS Quarterly 13(3), 319–340 (1989)
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)
Katz, M.L., Shapiro, C.: Technology Adoption in the Presence of Network Externalities. The Journal of Political Economy, 822–841 (1986)
Katz, M.L., Shapiro, C.: Systems Competition and Network Effects. The Journal of Economic Perspectives 8(2), 93–115 (1994)
Farrell, J., Saloner, G.: Standardization, compatibility, and innovation. The RAND Journal of Economics, 70–83 (1985)
Farrell, J., Saloner, G.: Installed Base and Compatibility: Innovation, Product preannouncements, and Predation. The American Economic Review, 940–955 (1986)
Arthur, W.B.: Competing Technologies, Increasing Returns, and Lock-in by Historical Events. The Economic Journal 99(394), 116–131 (1989)
Worldwide Smartphone OS share, http://www.icharts.net/chartchannel/worldwide-smartphone-os-share-2012-q1-2013-q1_m3zryyngc (accessed on June 2013)
Apple, http://www.apple.com/pr/library/2013/01/07App-Store-Tops-40-Billion-Downloads-with-Almost-Half-in-2012.html (accessed on June 2013)
Google Play, https://play.google.com/store/ (accessed on June 2013)
Windows Phone Store, http://www.windowsphone.com/en-us/store/overview (accessed on June 2013)
Blackberry World, http://appworld.blackberry.com/webstore/ (accessed on June 2013)
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)
Church, J., Gandal, N.: Network Effects, Software Provision, and Standardization. The Journal of Industrial Economics 85–103 (1992)
Gandal, N.: Hedonic Price Indexes for Spreadsheets and an Empirical Test for Network Externalities. The RAND Journal of Economics 25(1), 160–170 (1994)
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)
Besen, S.M., Farrell, J.: Choosing How to Compete: Strategies and Tactics in Standardization. The Journal of Economic Perspectives 8(2), 117–131 (1994)
Liebowitz, S.J., Margolis, S.E.: Path Dependence, Lock-in, and History. Journal of Law, Economics, & Organization 11(1), 205–226 (1995)
Brandenburger, A.M., Stuart, H.: Value-Based Business Strategy. Journal of Economics and Management Strategy 5, 5–25 (1996)
Kim, H.W., Chan, H.C., Gupta, S.: Value-Based Adoption of Mobile Internet: An Empirical Investigation. Decision Support Systems 43, 111–126 (2007)
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)
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)
Smedlund, A.: Value Co-creation in Service Platform Business Models. Service Science 4(1), 79–88 (2012)
Zhu, F., Iansiti, M.: Entry into Platform-Based Markets. Strategic Management Journal 33(1), 88–106 (2012)
Gawer, A., Cusumano, M.A.: How Companies Become Platform Leaders. MIT Sloan Management Review 49(2), 28–35 (2008)
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)
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)
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2013 Springer International Publishing Switzerland
About this paper
Cite this paper
Haile, N., Altmann, J. (2013). Estimating the Value Obtained from Using a Software Service Platform. In: Altmann, J., Vanmechelen, K., Rana, O.F. (eds) Economics of Grids, Clouds, Systems, and Services. GECON 2013. Lecture Notes in Computer Science, vol 8193. Springer, Cham. https://doi.org/10.1007/978-3-319-02414-1_18
Download citation
DOI: https://doi.org/10.1007/978-3-319-02414-1_18
Publisher Name: Springer, Cham
Print ISBN: 978-3-319-02413-4
Online ISBN: 978-3-319-02414-1
eBook Packages: Computer ScienceComputer Science (R0)