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The Impact of Transparency on Data-driven Innovation in Online Platforms

Rösch, Philipp LU (2021) EKHS35 20211
Department of Economic History
Abstract (Swedish)
Data derived from online platforms increasingly inform firms’ innovation processes, raising the potential for abuse and privacy violations. Hence, algorithmic and data transparency are required. This study contributes insights into the opportunities and barriers arising from data and algorithmic transparency for data-driven innovation approaches within platform ecosystems. The case of Apple Inc is exemplified by applying content analysis to secondary qualitative data available online. Opportunities benefitting platform companies are found to entail increased data insights sourced from their complementors and privacy-centric innovation as outputs of the data-driven innovation process. Moreover, platform firms obtain feedback on their... (More)
Data derived from online platforms increasingly inform firms’ innovation processes, raising the potential for abuse and privacy violations. Hence, algorithmic and data transparency are required. This study contributes insights into the opportunities and barriers arising from data and algorithmic transparency for data-driven innovation approaches within platform ecosystems. The case of Apple Inc is exemplified by applying content analysis to secondary qualitative data available online. Opportunities benefitting platform companies are found to entail increased data insights sourced from their complementors and privacy-centric innovation as outputs of the data-driven innovation process. Moreover, platform firms obtain feedback on their transparency and innovation practices from complementors, allowing for process improvements and insourcing of know-how. In contrast, an overemphasis on data poses a barrier to innovation as it may deter from uncovering innovations for which no data exists. Hence, the data-driven approach is to be complemented by other means to achieve breakthrough innovations. Moreover, on-device processing of data and consumers’ withdrawal from platforms due to privacy violations impede platform firms’ innovation processes. Complementors’ creativity is limited by their forced compliance with platform system features and privacy regulations. Overall, an equilibrium between insufficient and excessive transparency is required to facilitate data-driven innovation. (Less)
Please use this url to cite or link to this publication:
author
Rösch, Philipp LU
supervisor
organization
course
EKHS35 20211
year
type
H2 - Master's Degree (Two Years)
subject
keywords
Data-driven innovation, transparency, user data privacy, online platform, Apple Inc.
language
English
id
9054703
date added to LUP
2021-06-24 13:18:22
date last changed
2021-06-24 13:18:22
@misc{9054703,
  abstract     = {{Data derived from online platforms increasingly inform firms’ innovation processes, raising the potential for abuse and privacy violations. Hence, algorithmic and data transparency are required. This study contributes insights into the opportunities and barriers arising from data and algorithmic transparency for data-driven innovation approaches within platform ecosystems. The case of Apple Inc is exemplified by applying content analysis to secondary qualitative data available online. Opportunities benefitting platform companies are found to entail increased data insights sourced from their complementors and privacy-centric innovation as outputs of the data-driven innovation process. Moreover, platform firms obtain feedback on their transparency and innovation practices from complementors, allowing for process improvements and insourcing of know-how. In contrast, an overemphasis on data poses a barrier to innovation as it may deter from uncovering innovations for which no data exists. Hence, the data-driven approach is to be complemented by other means to achieve breakthrough innovations. Moreover, on-device processing of data and consumers’ withdrawal from platforms due to privacy violations impede platform firms’ innovation processes. Complementors’ creativity is limited by their forced compliance with platform system features and privacy regulations. Overall, an equilibrium between insufficient and excessive transparency is required to facilitate data-driven innovation.}},
  author       = {{Rösch, Philipp}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{The Impact of Transparency on Data-driven Innovation in Online Platforms}},
  year         = {{2021}},
}