Information Technology is becoming increasingly inseparable from various business actions. IT-enabled or IT-induced new products, services, or business models, have brought on fundamental changes to business operations, involving almost all activities in value chains and supply chains. As a consequence, whole market dynamics have changed drastically. Using various forms of IT, firms continue to enhance their ability of processing market information, access new market segments, adopt more flexible pricing strategies, and increase their competitiveness. Meanwhile, consumers continue to enjoy more IT advanced products and better services, and obtain higher consumer welfare. In general, the use of IT could lead to a win-win situation for both firms and consumers.

As a group, we are interested in the emergent competition forms driven by IT. For example, we study the competition in multi-product systems produced by networks (or “ecosystems”) of firms, and find that the network of firms can mimic the pricing behaviour and profitability of a vertically integrated monopoly. Firms, who develop systems with layered architectures, must tradeoff their platforms attractiveness to potential complementors and the risks of being unable to recoup their own investments ([1], [2]). In studying the pricing competition between the software-as-a-service and traditional software providers, we conclude that as commercial software becomes more open, modulated, and standardised, the SaaS business model will take more advantageous position in the competitive market ([3], [4]). Such a finding offers economic support to the further investments in cloud computing, and predicts the future prosperity of utility computing business model. In addition, we look at the competition between websites, analysing how they use new push technology, such as RSS feeds, to compete with their peers who offer similar products and services ([5]); as well as the pricing strategy of mobile voice and SMS services, examining the own- and cross-price elasticity of them ([6]). The latter research context poses significant econometric challenges due to three-part tariffs, and sequential discrete plan choice and continuous quantity choice decisions.

Selected Publications

[1] C. Y. Baldwin and C. J. Woodard. Competition in Modular Clusters. Harvard Business School Working Paper 08-042. Presented at the 2004 Academy of Management Annual Meeting, New Orleans, 2007.

[2] C. J. Woodard. Platform Competition in Digital Systems: Architectural Control and Value Migration. Working paper, 30 May. Presented at the 2006 Academy of Management Annual Meeting, Atlanta, 2008.

[3] Dan MA and Abrahamm Seidmann. Pricing on-demand software competitively in a dynamic market. Presented at the Workshop on Information Systems and Economics (WISE), December 2008.

[4] Dan MA. The pricing strategy analysis for the software-as-a-service business model. Grid Economics and business models, Volume 5206/2008, page 103-112, (book chapter).

[5] Dan MA. Do RSS feeds help to gain competitive advantage?. Proceeding of 42nd Annual Hawaii International Conference on System Science (HICSS), 2009.

[6] YongSoo KIM. An Empirical Analysis of Mobile Voice and SMS service: A Structural Model.