Title: The dynamism of the two-sided application store market

Authors: Kati Jarvi, Samuli Kortelainen

Addresses: Lappeenranta University of Technology, Kouvola Unit, Prikaatintie 9, 45100 Kouvola, Finland. ' Lappeenranta University of Technology, Skinnarilankatu 34, 53850 Lappeenranta, Finland

Abstract: Application stores as the most recent manifestation of two-sided markets have attracted multiple players, such as device and operating system manufacturers in the field of telecommunications. Although the option to enter the application store market offers a lucrative opportunity for the operators, there are significant internal and external challenges for operators entering the application business. In this paper we study what possibilities and challenges the two-sided application store market brings to the intermediary|s (e.g., operator|s) business and how these affect the market dynamism. Theoretically, we draw from the literature of two-sided markets, software platforms and intermediaries, observe the emergence of application stores and competition between them with real-world examples and conclude with the representation of the central issues in lowering the barriers to entry from the operators| point of view in order to grasp the arising opportunity.

Keywords: two-sided markets; software platforms; intermediaries; application developers; multiple players; device manufacturers; operating system manufacturers; lucrative opportunities; telecommunications; internal challenges; external challenges; market dynamism; competition; entry barriers; application operators; App Store; digital applications; distribution platforms; mobile operating systems; application stores; iPhone; smartphones; multimedia; mobile phones; cell phones; internet; world wide web; Apple; Google; Android Market; GetJar; Lithuania; technology marketing; innovation design; customers.

DOI: 10.1504/IJTMKT.2011.041943

International Journal of Technology Marketing, 2011 Vol.6 No.1, pp.57 - 71

Received: 18 Mar 2011
Accepted: 06 May 2011
Published online: 30 Sep 2014 *

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