A hedonic study of network effects in the market for word processing software
Decision Support Systems - Special issue: Economics and information systems
Pricing local search engines for company websites
Electronic Commerce Research and Applications
Optimal pricing for web search engines
WINE'05 Proceedings of the First international conference on Internet and Network Economics
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In this paper, we use an intertemporal monopoly pricing model to examine the pricing strategies for selling and renting packaged software using the World Wide Web. A two stage setup is used to model the versioning of software. The externalities created by renting and selling the software is incorporated in the model. The preliminary results obtained by solving the problem using numerical methods such as Kuhn-Tucker constrained optimization provided insights into the pricing strategies. We found that for high levels of network externalities, the prices in the second period are substantially higher. Profits also increase monotonically with the intensity of the network effect.