Despite a rich literature on switching costs in traditional markets, little has been said on the context of competition between pirate and legal providers. With a sizeable literature on the effects of piracy and its determinants, it is crucial to understand the specific barriers that may prevent consumers from diverting to unauthorised consumption in the first place. Basing on existing switching cost typologies, literature on piracy and new empirical evidence, I provide a first thorough categorisation of different switching costs in a market with legal and pirate providers. I discuss the implications for consumer retention strategies.

keywords: switching costs, piracy, competition, digital goods, file-sharing

JEL codes: , ,

publication year: 2020

language : English

thematic categories :

publishing series : IBS Working Paper

publication number : 08/2020

ISSN : 2451-4373

Wojciech Hardy

Institute for Structural Research (IBS), Faculty of Economic Sciences and Digital Economy Lab (DELab), University of Warsaw

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