Existence, Antecedents and Consequences of Non-Compliance in Mobile App Markets

16 Pages Posted: 26 Jun 2024

See all articles by Reinhold Kesler

Reinhold Kesler

University of Zurich

Lennart Kraft

Goethe University Frankfurt

Bernd Skiera

Goethe University Frankfurt

Tim Koschella

Realtime Technologies GmbH

Date Written: June 20, 2024

Abstract

Digital platforms, now ubiquitous intermediaries in the modern economy, claim to uphold governance rules aimed at ensuring a level playing field for their participants. However, there is limited research exploring the extent to which digital platforms fulfill this claim. Furthermore, the antecedents and consequences of any non-compliance remain largely unexamined. This paper addresses this research gap by examining the mobile app market. The empirical study analyzes 852 apps available on both Apple and Google platforms across 19 countries. It assesses these apps' disclosed versus actual behavior concerning device ID transfer for advertising purposes, aiming to pinpoint instances of non-compliance. The findings reveal that about 21% of the apps do not comply. Compliance rates are higher among apps catering to Apple users compared to those for Google users, with negligible variations across countries. Notably, older and larger apps, presumably with more experience and resources, demonstrate greater compliance. However, factors like popularity and reputation do not affect compliance. Intriguingly, non-compliant apps earn at least 10% more in advertising revenue than they would if being compliant, thus gaining a significant economic edge.

Keywords: non-compliance, apps, privacy, advertising, privacy labels

Suggested Citation

Kesler, Reinhold and Kraft, Lennart and Skiera, Bernd and Koschella, Tim, Existence, Antecedents and Consequences of Non-Compliance in Mobile App Markets (June 20, 2024). Available at SSRN: https://ssrn.com/abstract=4871225 or http://dx.doi.org/10.2139/ssrn.4871225

Reinhold Kesler (Contact Author)

University of Zurich ( email )

Rämistrasse 71
Zürich, CH-8006
Switzerland

Lennart Kraft

Goethe University Frankfurt ( email )

Grüneburgplatz 1
Frankfurt
Germany

HOME PAGE: http://lennartkraft.com

Bernd Skiera

Goethe University Frankfurt ( email )

Theodor-W.-Adorno-Platz 4
Frankfurt, 60323
Germany
+49 69 798 34640 (Phone)
+49 69 798 35001 (Fax)

HOME PAGE: http://www.skiera.de

Tim Koschella

Realtime Technologies GmbH ( email )

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