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Product Bundling in Software Industry: The Case of Operating System and Browser Market

Product bundling is a common tool to increase sales and profits for the firms when they sell products. In traditional market, because the consumer¡¦s reserve price to each product is different, adopting product bundling strategy can achieve their goal.
Now , owing to the highly changed technology and the prevailing of computer and internet, there are plenty of forms and varieties of product bundling. It is more different to do the research about the product bundling in computer, software, or some high-tech information industries. In the light of the characteristic of these industries, it is necessary to modify the product bundling strategy to meet the demand.
This study focuses on the product bundling strategy in software industry. A few days ago, in the case of Microsoft who violates the antitrust law, the public starts to pay attention to the product bundling strategy in software industry again. But the software industry has two very important characteristics. First, there are compatibility problems between different products. Second, it is difficult to define the boundary of products. So this study tries to build a model to explain the application of product bundling strategy in software industry, and use the model to confer the case of Microsoft.
There are three objects in this study. First, analyzing the advantages and disadvantages of product bundling strategies in all kinds of conditions in the recent years. Second, using the model to prove that if there is only one monopoly firm in the main product market and it bundles its main and downstream products. Then the downstream competitor and the consumers will be harmed. Third, using the inference of the model to comment the case that the U.S department of justice who accuses Microsoft bundling its personal computer operation system and browser.

Identiferoai:union.ndltd.org:NSYSU/oai:NSYSU:etd-0620100-163318
Date20 June 2000
CreatorsHsu, Tuang-Chou
ContributorsLeonard F.S Wang, Chia-Ouh Chang, Jen-Her Wu, Tru-Gin Liu
PublisherNSYSU
Source SetsNSYSU Electronic Thesis and Dissertation Archive
LanguageCholon
Detected LanguageEnglish
Typetext
Formatapplication/pdf
Sourcehttp://etd.lib.nsysu.edu.tw/ETD-db/ETD-search/view_etd?URN=etd-0620100-163318
Rightsnot_available, Copyright information available at source archive

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