The Spillover Effects of Copycat Apps and App Platform Governance

52 Pages Posted: 20 Oct 2022 Last revised: 13 Feb 2024

See all articles by Jingcun Cao

Jingcun Cao

The University of Hong Kong

Avery Haviv

University of Rochester - Simon Business School

Nan Li

Tongji University - School of Economics and Management

Date Written: February 17, 2023

Abstract

From taking inspiration to outright copying, new apps are frequently developed using the ideas of successful incumbents. Mobile app platforms, such as the Apple App Store and Google Play Store, have policies intended to screen these "copycat" apps.

We study the effect these "copycat" apps have on the demand and behavior of incumbents by leveraging data from multiple Android app markets in China. We first identify which apps copied others using a supervised machine learning approach. Our identification strategy leverages the fact that we observe the same app competing against different competitors on different platforms.

Our findings show that copycats tend to be more prevalent in smaller app markets and non-gaming categories. On average, copycats significantly reduce the demand for incumbent apps. This effect is most prominent in larger, highly rated apps. Furthermore, we find that the entry of copycats affects the innovation of incumbents. Incumbents who are exposed to copycats make larger changes to their descriptions and file size, while simultaneously seeing a reduction in their user ratings, and become less likely to use the platforms for subsequent releases. Our results suggest that the filtering of copycat apps confers significant benefits to incumbent app developers but reduces overall downloads of the app platform. This finding may inform recent discussions on the value that app platforms provide to developers.

Keywords: mobile apps; copycat apps; app platforms; spillover effects; platform governance

Suggested Citation

Cao, Jingcun and Haviv, Avery and Li, Nan, The Spillover Effects of Copycat Apps and App Platform Governance (February 17, 2023). Available at SSRN: https://ssrn.com/abstract=4250292 or http://dx.doi.org/10.2139/ssrn.4250292

Jingcun Cao

The University of Hong Kong

Pokfulam Road
Pokfulam Road
Hong Kong, 00000
China

Avery Haviv

University of Rochester - Simon Business School ( email )

Rochester, NY 14627
United States

Nan Li (Contact Author)

Tongji University - School of Economics and Management ( email )

Siping Road 1500
Shanghai, Shanghai 200092
China

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