Subsidy strategy analysis of operating system vendor with network externality effect

DOI

10.2991/febm-17.2017.3How to use a DOI?

Keywords

network externality effect, operating system vendor, subsidy policy, developer, consumer

Abstract

Owing to network externality effect is key characteristic of smartphone operating system, the vendor subsidizes app developer or consumer to extend market share. In this paper, using a two-period model framework, we study performance in cases of subsidizing developer and consumer separately. Then, the performances in two subsidy policies are compared. We find that subsidizing customer should be chosen if the development cost is low. And if the development cost is moderate, subsidizing developer can generate greater performance. Besides, the vendor must quit subsidizing if the development cost is high.

Copyright

© 2017, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Xiaofeng Zhang
AU  - Xiaojuan Zhang
AU  - Chunhui Cao
AU  - Hongcai Dai
AU  - Haixu Song
PY  - 2017/10
DA  - 2017/10
TI  - Subsidy strategy analysis of operating system vendor with network externality effect
BT  - Proceedings of the Second International Conference On Economic and Business Management (FEBM 2017)
PB  - Atlantis Press
SP  - 21
EP  - 27
SN  - 2352-5428
UR  - https://doi.org/10.2991/febm-17.2017.3
DO  - 10.2991/febm-17.2017.3
ID  - Zhang2017/10
ER  -