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2018

Computer Sciences

Competition

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A Model Of Competition Between Perpetual Software And Software As A Service, Zhiling Guo, Dan Ma Mar 2018

A Model Of Competition Between Perpetual Software And Software As A Service, Zhiling Guo, Dan Ma

Research Collection School Of Computing and Information Systems

Duplicate record, see https://ink.library.smu.edu.sg/sis_research/3744/. Software as a service (SaaS) has grown to be a significant segment of many software product markets. SaaS vendors, which charge customers based on use and continuously improve the quality of their products, have put competitive pressure on traditional perpetual software vendors, which charge a licensing fee and periodically upgrade the quality of their software. We develop an analytical model to study the competitive pricing strategies of an incumbent perpetual software vendor in the presence of a SaaS competitor. We find that, depending on both the SaaS quality improvement rate and the network effect, the …


A Model Of Competition Between Perpetual Software And Software As A Service, Zhiling Guo, Dan Ma Mar 2018

A Model Of Competition Between Perpetual Software And Software As A Service, Zhiling Guo, Dan Ma

Research Collection School Of Computing and Information Systems

Software as a service (SaaS) has grown to be a significant segment of many software product markets. SaaS vendors, which charge customers based on use and continuously improve the quality of their products, have put competitive pressure on traditional perpetual software vendors, which charge a licensing fee and periodically upgrade the quality of their software. We develop an analytical model to study the competitive pricing strategies of an incumbent perpetual software vendor in the presence of a SaaS competitor. We find that, depending on both the SaaS quality improvement rate and the network effect, the perpetual software vendor adopts one …