Enhancing revenue from information goods through the free-to-play business model using price discrimination

Changsok Yoo, Huy Kang Kim

Research output: Contribution to journalArticle

Abstract

The free-to-play business model for information goods is a price discrimination application in economics, but with the unique characteristics of the virtual world, scholars find it hard to understand from a price discrimination perspective. This study introduces the model and describes its development. Key to its cash generation logic are its monopolistic status based on free usage, the easiness of trial and error due to low marginal cost, and control of transfers among customers in the virtual world. A case study shows that the information business enhances revenue by changing the price logics of the model based on price discrimination.

Original languageEnglish
Pages (from-to)5901-5909
Number of pages9
JournalInformation (Japan)
Volume16
Issue number8 B
Publication statusPublished - 2013 Jan 1

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Keywords

  • Free-to-play
  • Information goods
  • Micro-transaction
  • Price discrimination

ASJC Scopus subject areas

  • Information Systems

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