Match!

Competitive Bundling in Information Markets: A Seller-Side Analysis

Published on Jan 1, 2016in Management Information Systems Quarterly4.373
· DOI :10.25300/MISQ/2016/40.1.05
Srinivasan Raghunathan28
Estimated H-index: 28
,
Sumit Sarkar21
Estimated H-index: 21
Abstract
The emerging field of data analytics and the increasing importance of data and information in decision making has created a large market for buying and selling information and information-related services. In this market, for some types of information products, it is common for a consumer to purchase the same type of information product from multiple sources. In other situations, a consumer may buy different types of information products from different sources and synthesize the information. On the seller side, bundling of different types of information products appears to have emerged as a key design strategy to improve profitability. This paper examines bundling decisions of a duopoly in the information market in which each seller offers two (or more) types of information products. A pair of competing information products from the two sellers can be substitutes or complements and consumers may find it profitable to purchase the same type of information from both sellers. We show that bundling by both sellers emerges as the equilibrium outcome when (at least) one competing pair consists of substitutes and (at least) one pair consists of complements. In this case, bundling by both sellers benefits them both by softening the price competition between their offerings. Softening of competition does not occur when all competing pairs in the bundles have only substitutes (complements) even if the degree of substitutability (complementarity) between products within a pair varies across pairs, resulting in an equilibrium in which each information type is sold separately by both sellers.
  • References (0)
  • Citations (6)
📖 Papers frequently viewed together
4 Citations
5 Citations
33 Citations
78% of Scinapse members use related papers. After signing in, all features are FREE.
References0
Newest
Cited By6
Newest
Traditionally, full-service broker/dealers catering to institutional investors have bundled trade execution with investment research. Since 2018, new market regulation has forced broker/dealers to unbundle and to sell research separately. The purpose of this paper is to shed some light on the expected pricing of research.,A stylized model is presented in this study in which a monopolist fixed income, currencies and commodities (FICC) research provider faces a linear demand function and picks an ...
Source
#1Mustafa Misir (NUAA: Nanjing University of Aeronautics and Astronautics)H-Index: 13
#2Hoong Chuin Lau (Singapore Management University)H-Index: 23
In this paper, we study the bundle design problem for offering personalized bundles of services using historical consumer redemption data. The problem studied here is for an operator managing multiple service providers, each responsible for an attraction, in a leisure park. Given the specific structure of interactions between service providers, consumers and the operator, a bundle of services is beneficial for the operator when the bundle is underutilized by service consumers. Such revenue struc...
Source
Source
#1Tomasz Kopczewski (University of Warsaw)H-Index: 4
#2Maciej Sobolewski (University of Warsaw)H-Index: 3
Last. Ireneusz Miernik (University of Warsaw)H-Index: 1
view all 3 authors...
Bundling is the practice of selling goods together in a package. The extant research has recognised the role of three elements affecting the profitability of bundling strategies: (i) heterogeneity of consumer's reservation prices and their dependence structure; (ii) complementarity of the demand and (iii) economies of scale and scope in production. These major elements are well defined but have never been integrated into one model. We present an integrated simulation model and show how these thr...
2 CitationsSource
#1Xiaoxiao Luo (College of Management and Economics)H-Index: 1
#2Minqiang Li (College of Management and Economics)H-Index: 15
Last. Nan Feng (College of Management and Economics)H-Index: 1
view all 4 authors...
Abstract This paper proposes a two-period model of intertemporal mixed bundling for two information products with network externality, in which a profit-maximizing monopolist offering two information products in the first period decides the optimal time of bundle release and the adoption of “Complete My Bundle” option. “Complete My Bundle” is an option offered by App Store, with which customers can enjoy the bundle discount even if they purchase all components within the bundle in different time...
4 CitationsSource
#1Asunur Cezar (TOBB University of Economics and Technology)H-Index: 4
#2Huseyin Cavusoglu (UTD: University of Texas at Dallas)H-Index: 19
Last. Srinivasan Raghunathan (UTD: University of Texas at Dallas)H-Index: 28
view all 3 authors...
Firms are increasingly outsourcing information security operations to managed security service providers (MSSPs). Cost reduction and quality (security) improvement are often mentioned as motives for outsourcing information security, and these are also the frequently cited reasons for outsourcing traditional information technology (IT) functions, such as software development and maintenance. In this study, we present a different explanation—one based on interdependent risks and competitive extern...
9 CitationsSource