Access Pricing to An Operating System Platform when Piracy Matters

This paper examines the impact of piracy on access pricing strategy of an operating system platform.We study the behavior of users and developers due to an increase in software protection when positive network externalities matter.We show that when piracy cost increases,access demands to the platform vary in the same direction and the magnitude of this variation depends on both the marginal network benefit that a developer derives and a certain threshold of piracy cost.Taking into account the behavior of these two sides when piracy matters,the monopoly platform changes its pricing strategy.We show that,it tends to reduce or to increase access fees.Finally,we show that under certain conditions,the divide-and-conquer pricing strategy can be reversed.