Flourish or Perish? The Impact of Technological Acquisitions on Contributions to Open-Source Software

Forthcoming in Information Systems Research

55 Pages Posted: 1 Jul 2018 Last revised: 29 Oct 2021

See all articles by Wei Chen

Wei Chen

University of Arizona - Eller College of Management

Fujie Jin

Kelley School of Business, Indiana University

Ling Xue

Georgia State University

Date Written: June 12, 2018

Abstract

This study examines the impact of technological acquisitions on contributions to firm-sponsored community-based open-source software (OSS). We distinguish between internal contributors affiliated with target firms and external contributors from the community, and examine how they respond to technological acquisitions differently. Theoretically, we examine how technological acquisition influences contributors’ uncertainty about project quality through a signaling effect and influences their uncertainty about project continuity through potential resource combination. We connect uncertainties with contributors’ motivations to theorize their responses to acquisitions. Empirically, we find that external contributors contribute more actively to both target firms’ sponsored projects and other projects in the OSS community after acquisitions, which contrast with the adverse effects of acquisitions observed in traditional corporate innovation. While internal contributors reduce contributions to target firms' sponsored projects after acquisitions, they increase contributions to other OSS projects in the community. We also find that the acquirer’s OSS experience and the project similarity between the acquirer and the target drive both external and internal contributors to shift their development efforts to the acquirer's projects and other projects in the OSS community. By examining these effort shifts in OSS contributions, our study generates unique theoretical insights about the impacts of technological acquisitions in the OSS context and important practical implications for acquirers, target firms, and the general OSS community.

Keywords: Open-Source Software, Technological Acquisitions, Internal Contributions, External Contributions, Openness, Difference-in-difference

JEL Classification: G34, L17, L86, O31, O36

Suggested Citation

Chen, Wei and Jin, Fujie and Xue, Ling, Flourish or Perish? The Impact of Technological Acquisitions on Contributions to Open-Source Software (June 12, 2018). Forthcoming in Information Systems Research, Available at SSRN: https://ssrn.com/abstract=3197897 or http://dx.doi.org/10.2139/ssrn.3197897

Wei Chen (Contact Author)

University of Arizona - Eller College of Management ( email )

McClelland Hall
P.O. Box 210108
Tucson, AZ 85721-0108
United States

Fujie Jin

Kelley School of Business, Indiana University ( email )

Business 670
1309 E. Tenth Street
Bloomington, IN 47401
United States
812-855-0943 (Phone)

HOME PAGE: http://https://kelley.iu.edu/facultyglobal/directory/FacultyProfile.cfm?netID=jinf

Ling Xue

Georgia State University ( email )

35 Broad Street
Atlanta, GA 30303-3083
United States

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