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This paper analyzes the economics of industries where network externalities are significant. In such industries, firms have strong incentives to adhere to common technical compatibility standards, so that they reap the network externalities of the whole group. However, a firm also benefits from...
Persistent link: https://www.econbiz.de/10005101687
We analyze the equilibrium size of networks under alternative market structures. Networks are characterized by positive … the three equilibrium networks. As a result, small networks will not observed. We call critical mass the size of the … compatible network goods support networks of smaller size than perfect competition and larger than monopoly. We extend our …
Persistent link: https://www.econbiz.de/10005101745
I analyze the salient features of networks and point out the similarities between the economic structure of networks …
Persistent link: https://www.econbiz.de/10005063071
Technology platforms, such as Microsoft Windows, are the hubs of technology industries. We develop a framework to characterize the optimal two-sided pricing strategy of a platform firm, that is, the pricing strategy towards the direct users of the platform as well as towards firms offering...
Persistent link: https://www.econbiz.de/10005622760
We consider a heretofore unexplored explanation for why platforms, such as Internet service providers, might impose download limits on content consumers: doing so increases the degree to which those consumers view content providers’ products as substitutes. This, in turn, intensifies the...
Persistent link: https://www.econbiz.de/10010905461
We discuss network neutrality regulation of the Internet in the context of a two-sided market model. Platforms sell broadband Internet access services to residential consumers and may set fees to content and application providers on the Internet. When access is monopolized, cross-group...
Persistent link: https://www.econbiz.de/10011056742
We discuss the benefits of net neutrality regulation in the context of a two-sided market model in which platforms sell Internet access services to consumers and may set fees to content and applications providers “on the other side” of the Internet. When access is monopolized, we find that...
Persistent link: https://www.econbiz.de/10005585461
The vast majority of US residential consumers face a monopoly or duopoly in broadband Internet access. Up to now, the Internet was characterized by a regime of “net neutrality” where there was no discrimination in the price of a transmitted information packet based on the identities of...
Persistent link: https://www.econbiz.de/10005622761
We discuss the benefits of net neutrality regulation in the context of a two-sided market model in which platforms sell Internet access services to consumers and may set fees to content and applications providers “on the other side” of the Internet. When access is monopolized, we find that...
Persistent link: https://www.econbiz.de/10005760651
Pricing of Internet access has been characterized by two properties. Parties are directly billed only by the Internet Service Provider (ISP) through which they connect to the Internet and the ISP charges them on the basis of the amount of information transmitted rather than its content. These...
Persistent link: https://www.econbiz.de/10008763998