A study of the chicken egg problem in derivative software products

The abductive model of negative network effects

Abstract

The purpose of this paper is to propose hypotheses about a mechanism that interferes with positive same side and cross side network effects in the two-sided platform strategy. This is caused by the "derivative species" made from the OS, applications, etc., which are complementary products running on platform products in the tow-sided platform strategy in the software industry. Then, the paper exemplifies the case and confirms the relationship between the development motivation of the developer who produces the complementary product and the diversity of the platform product. Finally, the paper derives platform strategy implications for platformers (platform providers).