Unravel the Drivers of Online Sharing Communities: An Empirical Investigation

35 Pages Posted: 9 Oct 2006

See all articles by Mu Xia

Mu Xia

Santa Clara University - Operations and Management Information Systems

Wenjing Duan

George Washington University - School of Business

Yun Huang

University of Texas at Austin - Department of Information, Risk and Operations Management; Northwestern University - Department of Industrial Engineering and Management Sciences

Andrew B. Whinston

University of Texas at Austin - Department of Information, Risk and Operations Management

Date Written: November 2006

Abstract

Recently user-oriented online sharing communities have seen explosive growth. Two characteristics of these communities set them apart from traditional online message-based communities such as online forums. First, users have no social ties before joining the community. Second, there is little or no "verbal" communication between users. This research investigates the structure and dynamics of online sharing communities using data collected from an IRC music channel from 2001 to 2006, covering all five years of the post-Napster age. We have collected more than three hundred million individual activities, capturing 0.05% of the global music sharing volume. We find that sharers are an essential part of the community and their activities have a dominant impact on the growth of the community. By contrast, free riders have two opposite impacts on sharer retention. More free riders in number make it more likely for a sharer to keep sharing, while more free rider activities discourage sharers from contributing. That is, the existence of free riders, despite the congestion caused by their download activities, does to some degree stabilize the community. Most previous literature examines the online community only from the aggregate level. Our study, nevertheless, distinguish the influence and behavior of different members in the community. Instead of paying only attention to the total number of users, our results suggest that understanding the impact of their core members is critical in investigating the dynamics and the sustainability of online sharing communities.

Keywords: sharing community, sustainability, network externality, free-riding

JEL Classification: C12, C35, D71, D91

Suggested Citation

Xia, Mu and Duan, Wenjing and Huang, Yun and Huang, Yun and Whinston, Andrew B., Unravel the Drivers of Online Sharing Communities: An Empirical Investigation (November 2006). McCombs Research Paper Series No. IROM-09-06, Available at SSRN: https://ssrn.com/abstract=935004 or http://dx.doi.org/10.2139/ssrn.935004

Mu Xia (Contact Author)

Santa Clara University - Operations and Management Information Systems ( email )

500 El Camino Real
Santa Clara, CA 95053
United States
408-554-4052 (Phone)

Wenjing Duan

George Washington University - School of Business ( email )

2121 I Street NW
Washington, DC 20052
United States

Yun Huang

Northwestern University - Department of Industrial Engineering and Management Sciences ( email )

Evanston, IL 60208-3119
United States

University of Texas at Austin - Department of Information, Risk and Operations Management ( email )

CBA 5.202
Austin, TX 78712
United States

Andrew B. Whinston

University of Texas at Austin - Department of Information, Risk and Operations Management ( email )

CBA 5.202
Austin, TX 78712
United States
512-471-8879 (Phone)

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