Mobile application pricing
AbstractThis paper examines the pricing of mobile applications when application providers can either supply consumers directly or through a mobile platform (such as a smart phone or tablet). It is demonstrated that when platform access (i.e., purchasing a device) takes place in advance of application pricing, a non-trivial unravelling problem exists that rules out selling platform access at a positive price. Consequently, all platform revenues come from sharing application provider revenues. It is demonstrated that several restrictive conditions on application providers, such as most favoured customer clauses, can allow the platform provider to earn more profits and charge a positive access price increasing the likelihood the platform is provided.
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Bibliographic InfoArticle provided by Elsevier in its journal Information Economics and Policy.
Volume (Year): 24 (2012)
Issue (Month): 1 ()
Contact details of provider:
Web page: http://www.elsevier.com/locate/inca/505549
Platform; Two-sided markets; Complements; Most favoured customer clause;
Find related papers by JEL classification:
- L17 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Open Source Products and Markets
- L32 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Enterprises; Public-Private Enterprises
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