Cocreation of Value in a Platform Ecosystem: The Case of Enterprise Software1

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…