Facebook Platform is a prominent example of an internet-based service
for which third-party developers can offer small add-on programs, which
are often referred to as applications. The distribution of success of
applications is highly skewed. This market structure with few
blockbuster applications and a long-tail of unpopular ones is common in
the media, entertainment and software industries. Philip Mayrhofer
compiled individual-level survey data as well as an original panel data
set of Facebook applications in order to examine the market for Facebook
applications in detail. Specifically he identifies interdependencies
such as bandwagon effects between users and spillovers between
applications and analyzes whether they contribute to the concentrated
market structure.