Optimal Pricing of Information Goods under the Freemium Strategy in the Presence of Piracy and Network Effects

2016 ◽  
Author(s):  
Guofang Nan ◽  
Minqiang Li ◽  
Yong Tan
Keyword(s):  
Network Effects ◽  
Optimal Pricing ◽  
Information Goods

Optimal Pricing for a Multinomial Logit Choice Model with Network Effects

2016 ◽  
Vol 64 (2) ◽  
pp. 441-455 ◽  
Author(s):  
Chenhao Du ◽  
William L. Cooper ◽  
Zizhuo Wang
Keyword(s):  
Network Effects ◽  
Choice Model ◽  
Multinomial Logit ◽  
Optimal Pricing

Optimal pricing for group buying with network effects

Omega ◽  
2016 ◽  
Vol 63 ◽  
pp. 69-82 ◽  
Author(s):  
Guoquan Zhang ◽  
Jennifer Shang ◽  
Pinar Yildirim
Keyword(s):  
Network Effects ◽  
Optimal Pricing ◽  
Group Buying

Impact of Network Structure on New Service Pricing

2021 ◽  
Author(s):  
Saed Alizamir ◽  
Ningyuan Chen ◽  
Sang-Hyun Kim ◽  
Vahideh Manshadi
Keyword(s):  
Network Structure ◽  
Dynamic Pricing ◽  
Network Effects ◽  
Spectral Characteristics ◽  
Network Externality ◽  
Local Network ◽  
Optimal Pricing ◽  
Consumption Growth ◽  
Positive Externality ◽  
The Impact

We analyze a firm’s optimal pricing of a new service when consumers interact in a network and impose positive externality on one another. The firm initially provides its service for free, leveraging network externality to promote rapid service consumption growth. The firm raises the price and starts earning revenue only when a sufficient level of consumer interactions is established. Incorporating the local network effects in a nonstationary dynamic model, we study the impact of network structure on the firm’s revenue and optimal pricing decision. We find that the firm delays the timing of service monetization when it faces a more strongly connected network despite the fact that such a network allows the firm to monetize the service sooner by resulting in faster consumption growth. We also find that the firm benefits from network imbalance; that is, the firm prefers a network of consumers with varying degrees of connections to that with similar degrees of connections. We also study the value of knowing the network structure and discuss how such knowledge impacts the firm’s profitability. Our analyses rely on the techniques from algebraic graph theory, which enable us to solve the firm’s high-dimensional dynamic pricing problem by relating it to the network’s spectral characteristics.

Pricing in the Digital Age

2010 ◽  
pp. 53-72 ◽  
Author(s):  
Chip E. Miller
Keyword(s):  
Digital Age ◽  
Pricing Strategy ◽  
The Internet ◽  
Optimal Pricing ◽  
Information Goods ◽  
Digital Goods ◽  
Optimal Pricing Strategy ◽  
Research Findings ◽  
Costs Of Production

Consumers have greater ability than ever to compare prices on products using the Internet. Also, information goods can be sold at much lower prices because of greatly reduced or almost non-existent costs of production. However, because of the ease of pirating information goods, company pricing strategy must take steps to offset losses from unauthorized copies of digital goods. An overview of traditional pricing strategy is presented, followed with research findings of specific actions to undertake for optimal pricing strategy in various scenarios. Discussions of versioning, windowing, bundling and unbundling, with recommendations for use of each, follow. This chapter explores the pressures placed on prices, the strategies companies use when setting price, and provides examples and discussion of sales methods on the Internet for both physical and digital goods.

Born global on blockchain

2018 ◽  
Vol 28 (1) ◽  
pp. 19-34 ◽  
Author(s):  
Tatiana Zalan
Keyword(s):  
Network Effects ◽  
Born Global ◽  
Information Goods ◽  
Economics Of Information ◽  
Ongoing Research ◽  
Global Literature ◽  
Content Type ◽  
Research Opportunities ◽  
Blockchain Technology ◽  
Start Ups

Purpose The purpose of this paper is to alert international business (IB) and international entrepreneurship (IE) researchers of a new phenomenon and novel research opportunities arising as a result of digital innovations brought about by the new, decentralized internet popularly known as “blockchain”. The paper contains a general overview of the blockchain technology and maps connections with the IB/IE literature, focusing on explaining accelerated internationalization of firms that are born global on blockchain. Design/methodology/approach The paper is a viewpoint based on the author’s ongoing research on blockchain and fintech and reflections on the born global literature. The paper has benefited from the author’s insights through her involvement in the global blockchain community as an investor and advisor. Findings The author argues for establishing a theoretical link between the born global literature and the literature on the economics of information goods and platform economics to explain the pace of international growth in the context of blockchain start-ups. Research limitations/implications The author urges IB/IE researchers to pay attention to research opportunities in the blockchain area, especially those related to explaining rapid internationalization of digital start-ups and a new organizational form for organizing cross-border activities known as decentralized autonomous organization. Originality/value Three factors are shown to contribute to a rapid internationalization of blockchain start-ups: network effects, solving the chicken-and-egg problem and building an ecosystem around the evolving technology.

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