An Analysis of Copyright Protection Strategy With Customers Category and Network Externality

Fangsheng CAO, juanjuan HAO

Abstract


Illegal reproduction is increasingly becoming a major concern of companies and the society. Previous research has shown when network effect is strong, piracy could be beneficial for firms. However, some researchers got that strong network effects can sometimes lead to a firm choosing higher levels of copyright protection. How to choose the investment strategy for firms in this society with prevalent piracy? There are two strategies: no copyright protection and setting copyright protection. We address two questions in a monopoly and duopoly setting. Frist, what effects the attractiveness of each of the two strategies? Second, under which conditions will any particular strategy dominate another? We show that in a monopoly setting, firms prefer not to take a copyright protection with higher level of network effect and more support-piracy consumers. In a duopoly setting, the equilibrium of game theory is at the choice of the strategy of copyright protection.


Keywords


Piracy; Network externality; Copyright protection strategy; Customer category

Full Text:

PDF

References


Cheng, G. S., Chen, H. M., & Sun, W. J. (2006). The mode decision on merger of firms with the characteristic of network externalit. Chinese Journal of Management Science, 14(5), 121-127. (in Chinese)

Conner, K., R., & Rumelt, R. P. (1991). Software piracy: An analysis of protection strategies. Management Sci., 37(2), 125-139.

Economides, N. (1996). Network effect, complementarities, and invitations to enter. Eur. Political Econom., 12211-12232

Gürses, İ. Ö. A., & Elif, Y. O. (2014). Effectiveness of product placement: An experimental study in Turkey. Canadian Social Science, 10(1), 56-63.

Hui, K. L., & Png, I. P. L. (2003). Piracy and the legitimate demand for recorded music. Contributions to Econom. Anal. Policy, 2(1), 1160-1184.

Jain, S. (2008). Digital piracy: A competitive analysis. Marketing Science, 27(4), 610-626.

Moul, C. (2006). The day after tomorrow: Longer run issues in theatrical exhibition. Marketing Sci., 25(6), 665-666.

Oz, S., & Thisse, J. F. (1999). A strategic approach to software protection. Economic Management Strategy, 8(2), 163-190.

Peitz, M., & Waelbroeck, P. (2006). Piracy of digital products: A critical review of the theoretical literature. Information Economics and Policy, 18(4), 449-476.

Sun, B., Xie, J., & Cao, H. H. (2004) . Product strategy for innovators in markets with network effects. Marketing Science, 23(2), 243-254.

Takeyama, L. (1994). The welfare implications of unauthorized reproduction of intellectual property in the presence of demand externalities . Indust. Econom., 42(2), 155-166.

Xu, B., & Zhu, D. Y. (2007). Extended hotelling model with network externality. Journal of Management, 10(1), 9-17.

Ye, W. F. (2006). Market strategies for copyright protection of softwares with network externality (Master’s thesis). Xiamen University. (in Chinese).

Huang, Y. L., Lu, X. X., & Wang, X. (2014). The effects of transformational leadership on employee’s pro-social rule breaking. Canadian Social Science, 10(1),128-134.




DOI: http://dx.doi.org/10.3968%2F4482

Refbacks

  • There are currently no refbacks.


Reminder

If you have already registered in Journal A and plan to submit article(s) to Journal B, please click the CATEGORIES, or JOURNALS A-Z on the right side of the "HOME".


We only use three mailboxes as follows to deal with issues about paper acceptance, payment and submission of electronic versions of our journals to databases: caooc@hotmail.com; css@cscanada.net; css@cscanada.org

Copyright © Canadian Academy of Oriental and Occidental Culture

Address: 730, 77e AV, Laval, Quebec, H7V 4A8, Canada

Telephone: 1-514-558 6138

Http://www.cscanada.net Http://www.cscanada.org

E-mail:css@cscanada.net, css@cscanada.org