The paper attempts at explaining some of market strategies of monopolies in information product markets. A special case is considered where a particular information product, supplied by a monopoly, has captured a limited market share, or where the overall market is limited by a particular number of users. The only way for the supplier to keep this market share, and to continue extracting revenue, is to eventually offer a new version of the information product. The customers then accept the new version only if it has some new quality characteristics they are prepared to pay for. Using a theoretical model, we derive some conclusions why the incentives of monopolies to contribute to the quality of their new versions of information products are limited.
Torlina, Luba and Kazakevitch, Gennadi, "A Monopoly Strategy Developing a New Version of Information Product or Why Microsoft Products Do Not Become Much Better" (2001). ACIS 2001 Proceedings. 63.