Analysis Of Pricing Strategy On Online Games

Compared with traditional products, online games have their own distinctive economic and technical characteristics In the environment of high-speed network economic.Based on fixed costs and low marginal costs of the special cost structure, online games are enormous scale of the supply-side economy; and based on strong network externality, it is of great demand-side economies of scale.Under such circumstances, how online games products rational pricing has become increasingly important. Traditional marginal cost pricing would no longer apply online games, online game companies must be based on the network effects and consumer awareness of the value pricing can be an ideal income.Based on the pricing strategy online games for the study.Considered the charges and free pricing. Through the establishment of profit model to study which of these two charges is the best way in the conditions of the network externality.Especially in the monopolized market conditions, what kind of pricing strategies should be taken in order to more effectively occupy the market and achieve profit maximization.We found that the optimal price is determined by the quality of service and the price of free service.When the online game provider make a choice of service, they should be more consideration of the network nxternalities or build its operations mechanism which network externalities can be obvious effects.It can be lock effect on consumers more easily to gain more profits. In the prices of options, it should be free strategy led to attract consumers to enter, by improving the quality of online games to pro fit. When the quality reached a critical point, all using the free service will become the consumers may pay the basis for consumers.At this time, it maximize profits.