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Title: Optimal strategies for a monopoly intermediary in the supply chain of complementary Web services
Authors: Qian, T. 
Hsing, C.
Keywords: Business intermediary
Network externalities
Supply chains
Web services
Issue Date: 2006
Source: Qian, T.,Hsing, C. (2006). Optimal strategies for a monopoly intermediary in the supply chain of complementary Web services. Journal of Management Information Systems 23 (3) : 275-307. ScholarBank@NUS Repository.
Abstract: Web services are interoperable and reusable software components that can be dynamically discovered and integrated over the Internet. Developed on open standards, Web services have become a promising solution to inter- and intra-organization application integration. The supply chain of Web services exhibits two distinct features that are not considered in previous literature on information and physical-good supply chain: the integration of multiple Web services and the cross-network externality effect between Web service vendors and users. In a quest to fill in the research gap, this paper studies the optimal pricing strategies of a monopolistic inter-mediary in the supply chain of complementary Web services. The Web service inter-mediary (WSI) provides both technical and aggregation services, and seeks to charge optimal subscription and listing fees. Analytical results show that in a supply chain of complementary Web services exhibiting cross-network effects, the optimal strategy for the WSI is to set the listing fee such that all service providers list on it. On the other hand, the optimal subscription fee depends on the intensity of the cross-network effect, consumers' valuation of value-added services, and the characteristics of the Web services under consideration. © 2007 M.E. Sharpe, Inc.
Source Title: Journal of Management Information Systems
ISSN: 07421222
DOI: 10.2753/MIS0742-1222230310
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