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Versioning Digital Products  

Yoo Keuk Ryoul (동덕여자대학교 경영학과)
Publication Information
Korean Management Science Review / v.21, no.3, 2004 , pp. 1-12 More about this Journal
Abstract
The paper demonstrates that versioning of digital products occurs more frequently than that of physical products because of low marginal cost. The versioning occurs no matter what a customer knows his/her reservation price. Low-quality version will not be produced when the difference between reservation prices is very large. The paper also shows that a firm tries to lower the quality of low-quality product to prevent customers with high reservation prices from purchasing low-quality product.
Keywords
Versioning; Digital Product; Marginal Cost; Reservation Price; Quality Differentiation;
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