The entry-deterring effects of synergies in complementor acquisitions: Evidence from Apple's digital platform market, the iOS app store

• 成果类型: Article
• 署名作者: Wang, Yongzhi; Rajagopalan, Nandini; Yue, Lori Qingyuan; Wu, Brian
• 署名单位: University System of Ohio; Ohio State University; University of Southern California; Columbia University; University of Michigan System; University of Michigan
• 刊物名称: STRATEGIC MANAGEMENT JOURNAL
• ISSN/ISSBN: 0143-2095
• DOI: 10.1002/smj.3639
• 发表日期: 2024
• 页码: 2791-2817
• 关键词: acquisition synergies; complementary-technology side; digital platform markets; economies of scale; economies of scope; Market entry; user side

摘要

Research Summary: We develop the following typology of four types of acquisition synergies by integrating the multisidedness feature of digital platforms with the mainstream strategy research: complementary-technology-side economies of scope, complementary-technology-side economies of scale, user-side economies of scope, and user-side economies of scale. We show that (1) acquisition synergies are entry-deterring, (2) synergies derived from economies of scope have stronger effects than those derived from economies of scale, and (3) synergies derived from the technology side have stronger effects than those derived from the user side. We highlight the significant competitive and regulatory implications of our findings. For example, one standard-deviation increase in technology-side economies of scope is associated with 55 deterred entries in 1 month or a $2.80 million potential loss in annual revenue. Managerial Summary: Acquisitions can shift the market structure of a digital platform in ways that affect subsequent entries and hence the platform's base of complementors. Synergies that complementor acquirers accrue can be entry-deterring. We develop a two-by-two typology of acquisition synergies in a multisided platform based on the two sides of a platform market (user side or complementary-technology side) and two sources of synergies (economies of scale or economies of scope). We then leverage over 279,000 app developers' entry decisions into product categories in Apple's iOS App Store, over 71 million customer reviews, and over 12,000 unique software development kits to construct measures of synergies. Our paper contributes to the platform literature by demonstrating the entry-deterring effects of synergies that complementor acquirers can exploit.