Publisher's announcements and piracy-monitoring devices in software adoption

Éric Darmon, Alexandra Rufini () and Dominique Torre ()
Additional contact information
Éric Darmon: CREM UMR CNRS 6211, University of Rennes 1, France

Economics Working Paper Archive (University of Rennes & University of Caen) from Center for Research in Economics and Management (CREM), University of Rennes, University of Caen and CNRS

Abstract: In this paper, we investigate the distribution strategy of a software publisher. The user adoption context is characterized by uncertainty about quality (experience good)and heterogeneous piracy costs. Users can purchase or get unauthorized/illegal copies (digital piracy) of the software during two periods (or not adopt at all). Between these two periods, users can acquire information through word-of-mouth. To maximize profit, the publisher needs to decide about price, quality and level of monitoring of piracy. We show that the software publisher can profit from accommodation a certain level of piracy of the product. We add to the literature by explicitly considering the opportunity for the publisher to cheat about future price and monitoring levels (misleading announcements). This strategy that is falsely permissive towards piracy, can sometimes appear more profitable. However, when the degree of sophistication of user expectations about the publisher's strategy increases, only a strategy that is permissive (with respect to piracy) with non misleading announcements remains robust.

Keywords: software distribution strategy; piracy; experience good; misleading announcements (search for similar items in EconPapers)
JEL-codes: D43 D83 K42 L15 (search for similar items in EconPapers)
Date: 2014-03
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ged.univ-rennes1.fr/nuxeo/site/esupversion ... 65-a207-201e34e74640 (application/pdf)

Related works:
Journal Article: Publisher's Announcements and Piracy-Monitoring Devices in Software Adoption (2014)
Working Paper: Publisher's Announcements and Piracy-Monitoring Devices in Software Adoption (2014)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:tut:cremwp:201404

Ordering information: This working paper can be ordered from
CREM (UMR CNRS 6211) - Faculty of Economics, 7 place Hoche, 35065 Rennes Cedex - France

Access Statistics for this paper

More papers in Economics Working Paper Archive (University of Rennes & University of Caen) from Center for Research in Economics and Management (CREM), University of Rennes, University of Caen and CNRS CREM (UMR CNRS 6211) – Faculty of Economics, 7 place Hoche, 35065 RENNES Cedex. Contact information at EDIRC.
Bibliographic data for series maintained by GERMAIN Lucie ().