Author(s)

Liu Dawei, Yao Min, Li Qian

Corresponding Author

Li Qian

Abstract

After the initial free phase, platform will try to charge some or all users to compensate costs or increase profitability. In order to analyse the influence of the psychological cost on the choice of the charging method for the platforms, a basic model is constructed. Then the selection of the supplier is analyzed through static game and the dynamic game under the monopoly and duopoly respectively. For monopolists, if only one charging method can be choose, the usage charges will be choose when the psychological cost is low, else it will choose membership charges. If the supplier can choose both methods simultaneously, the option to provide two charging methods at the same time will obtain higher profits. In a duopoly, one firm uses membership charges and the other uses usage charges whether it is static game or dynamic game.

Keywords

Platform; pricing mode; psychological cost