A Research of the Vertical Differentiation of Digital Content Products Basing on Numerical Simulation Analysis

Abstract:

This paper mainly analyze the motivation of enterprises to provide differentiation products, and market result, relevant social welfare effect in digital content products market. First, combing the specific characteristics of digital content products, this paper has developed the Vertical Differentiation Model of Digital Content Products". And then makes an numerical simulation of this model. We get two primary conclusion:(1)Under the assumption of economic man, digital content market will form vertical differentiation of product quality at last, namely products of different classes will coexist and every enterprise will have relevant stable competitive strategy.(2) The digital content market has a trend that enterprises with high quality products will get higher profit. There are three points of new ideas. (1) introducing specific characteristics of digital content product to the model. (2) loosening previous assumption of rational customer. (3)Introducing non-quality characteristic to the question of quality-choosing.

• Periodical: Advanced Materials Research (Volumes 756-759)
• Pages: 967-971
• DOI: https://doi.org/10.4028/www.scientific.net/AMR.756-759.967
• Online since: September 2013
• Authors: Zhen Bo Zhang, Ling Yi Hu, Bin Wang
• Keywords: Digital Content Product, Numerical Simulation, Vertical Differentiation

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