IDEAS home Printed from https://ideas.repec.org/a/spr/joevec/v11y2001i2p231-248.html
   My bibliography  Save this article

Optimal freeware quality in the presence of network externalities: an evolutionary game theoretical approach

Author

Listed:
  • Ernan Haruvy

    (Faculty of Industrial Engineering and Management, Technion, Haifa 32000, Israel)

  • Ashutosh Prasad

    (School of Management, The University of Texas at Dallas, Richardson, TX 75083-0688, USA)

Abstract

New software products often face difficulty in achieving market penetration. A potential remedy is to offer a freeware version of the software to encourage initial adoption and establish a larger user base for the software, thereby increasing the commercial version's value to adopters in future periods. However, to avoid complete cannibalization of the commercial version, the freeware version's quality must be sufficiently low and the price of the commercial version must not be too high. We model the effect of these two decision variables, price and freeware quality, on the adoption of software using static and evolutionary game theory.

Suggested Citation

  • Ernan Haruvy & Ashutosh Prasad, 2001. "Optimal freeware quality in the presence of network externalities: an evolutionary game theoretical approach," Journal of Evolutionary Economics, Springer, vol. 11(2), pages 231-248.
    • Handle: RePEc:spr:joevec:v:11:y:2001:i:2:p:231-248
    as

    Download full text from publisher

    File URL: http://link.springer.de/link/service/journals/00191/papers/1011002/10110231.pdf
    Download Restriction: Access to the full text of the articles in this series is restricted
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alexia Gaudeul, 2010. "Software marketing on the Internet: the use of samples and repositories," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 19(3), pages 259-281.
    2. Cheng, Hsing Kenneth & Tang, Qian Candy, 2010. "Free trial or no free trial: Optimal software product design with network effects," European Journal of Operational Research, Elsevier, vol. 205(2), pages 437-447, September.
    3. Bo Yan & Zijie Jin & Lifeng Liu & Si Liu, 2018. "Factors influencing the adoption of the internet of things in supply chains," Journal of Evolutionary Economics, Springer, vol. 28(3), pages 523-545, August.
    4. Xia, Xiaoning & Li, Pengwei & Cheng, Yang, 2023. "Tripartite evolutionary game analysis of power battery carbon footprint disclosure under the EU battery regulation," Energy, Elsevier, vol. 284(C).
    5. Haruvy, Ernan & Prasad, Ashutosh, 2005. "Freeware as a competitive deterrent," Information Economics and Policy, Elsevier, vol. 17(4), pages 513-534, October.
    6. Christophe Faugere & Giri Kumar Tayi, 2003. "Designing Free Sofware for Marketing: A Game Theoretic Approach," Game Theory and Information 0311003, University Library of Munich, Germany.
    7. Park, Sungwook & Kwon, Youngsun, 2023. "Disentangling the effects on OTT platform performance of three strategies: Pricing, M&As, and content investments," Telecommunications Policy, Elsevier, vol. 47(8).
    8. Hsi Tse Wang, 2020. "Discussion of the Competitive Strategies of Telecom Operators and Over-the-Top Service Providers from the Perspective of Evolutionary Game Theory," Decision Analysis, INFORMS, vol. 17(3), pages 260-275, September.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:joevec:v:11:y:2001:i:2:p:231-248. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.