Monopoly Pricing Strategy with Network Externality

Since network externalities maybe effect on the consumer's expect,monopoly firm's pricing strategy and profits,so it is important to a monopoly firm how to supply the consumer products in different stages and set a reasonable price in order to gain maximum profit when the products have the network externality character.To explore the problem,this paper study the monopoly firm's pricing strategies by construct of a 2-stage dynamic model about a monopoly firm in two cases:monopoly supply the same products and different products.It is shown that if the monopoly firms supply the same products,the price of first stage is larger than the discount value of the second's;if the monopoly supply the different products,the price with network externality is lower than without network externality.