Network Externality and Software Piracy

Sougata Poddar ()

No DP2002-115, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: The pervasiveness of the illegal copying of software is a worldwide phenomenon. Software piracy implies a huge loss of potential customers of original software buyers, which directly translates into revenue losses for the software industry. Given this, conventional wisdom would suggest the need for the legal software firms and governments to take a harsh approach on piracy of software. Interestingly, there is a trend of literature, which establishes that it is actually profitable for the original software developer to allow limited piracy in the presence of network externality.

Keywords: Competition; Computer software; Intellectual property (search for similar items in EconPapers)
Date: 2002
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Citations: View citations in EconPapers (1)

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