Abstract
Digital platform ecosystems have become pivotal organisational forms in the modern economy, facilitating entrepreneurial innovation while creating significant power asymmetries. This study examines how entrepreneurial firms, operating on innovation platforms, experience, react to, and manage their dependence on innovation platforms. Despite the mutual benefits of co-specialisation and technological enablement, the governance of these ecosystems often leads to constraints for participating firms and amplifies the challenges of power imbalance. Drawing on resource dependence theory, we investigate how app developers in the iOS App Store navigate power asymmetries with Apple. Through interviews with executives of successful app developers, we reveal intricate connections between experiencing power asymmetry or mutual dependence, negative or positive interpretations and emotions from such experiences, and their impact on developers’ (dis)engagement strategies as well as their passivity or proactivity in abiding the regulations imposed by the platform owner. Moreover, we show how privileged or perceived opportunities with the focal ecosystem tilt developers’ inclination towards engagement strategies by regulating their negative emotions. Our findings contribute to understanding power dynamics in innovation platforms, highlighting the role of emotions and interpretations in entrepreneurial strategies.