Third-Party Software Development Kit Utilization and Mobile App Market Performance: An Empirical Study from the Boundary-Spanning Perspective

In the highly competitive mobile market, third-party vendors located outside the purview of hosting mobile platforms are becoming major suppliers of functional toolkits for mobile app development and innovation. Mobile app developers, however, face the uncertainty of whether and how to use third-party software development kits (SDKs) from these external vendors to create more appealing and engaging mobile apps. This study examines the extent to and conditions under which third-party SDK utilization affects mobile app market performance. Drawing on the platform ecosystem literature and boundary object theory, we contextualize the boundary-spanning practice in mobile app development as the extent to which developers utilize third-party SDKs and theorize the performance impact of third-party SDKs. Moreover, the boundary-spanning perspective leads us to examine how the performance impact of third-party SDKs varies across tool-types versus platform-types, the evolution of platform boundaries, and levels of app developers’ platform-specific experience. By conducting difference-in-differences-style analyses on a longitudinal dataset of 335,958 multi-homing mobile apps released on Apple App Store and Google Play, our study reveals that utilizing more third-party SDKs is positively associated with daily active users of mobile apps. This positive impact is limited to tool-type third-party SDKs, however, and is attenuated by platform updates and app developers’ platform-specific experience. This study contributes to the platform-based software innovation and platform governance literature and provides managerial implications for app developers, platform managers, and third-party SDK providers.