Strategic Role of Alliance Portfolio and Application Programming Interfaces Economy: Empirical Evidence from the Mashup Applications Context

Numerous companies (e.g., Amazon, Facebook, Wikipedia, Twitter, Google, and TikTok) provide various resource and integration tools such as APIs and SDKs to facilitate the development and innovation of third-party developers. Yet there is still limited understanding of the role APIs play in alliance relationships and the performance impacts of various API attributes. Drawing upon insights from the strategic alliance portfolio literature and ecology literature, we propose that the alliance portfolio resource of the APIs’ size and diversity will have an inverted U-shape relationship with the online performance of focal applications. Furthermore, the intraspecific competition of applications that adopt the same APIs is supposed to moderate these relationships. We test these hypotheses with a data set of 5,450 mashup applications collected from programmableweb.com, one of the largest directories of public APIs and mashup applications records. Potential theoretical contributions and practical implications are discussed.