To upgrade or not to upgrade? the release of new versions to survive in the hypercompetitive app market

Abstract

Very low entry barriers and an exceptionally high degree of competition characterize the market for mobile applications. In such an environment one of the critical issues is how to at- tract the attention of users. Practitioners and developers are well aware that managing app updates (i.e., releasing new versions of an existing app) is critical to increase app visibil- ity and to keep users engaged, disguising a hidden strategy to stimulate downloads. We use unbalanced panel data with characteristics for the top 1,000 apps on iTunes and Google Play stores, for five European countries, to empirically in- vestigate publishers’ strategies concerning the release of up- dates. We find that only in the case of iTunes updates boost downloads and are more likely to be released when the app is experiencing poor performance. We interpret this finding as evidence that the lack of quality control by Google Play leads to an excess of updating of Android apps.