| Summary: | Owing to the symbolic, highly digitizable nature of the goods the content industry produces, they are highly amenable to digital transformation with radical consequences for businesses selling information products. Digitization and digital networks can save several costs that are inherent in the brick and mortar value chain in the content industry. This transformation creates newer values at several points in the value chain, leading to the emergence of newer business models that enlarge the existing business pie by attracting new customers or encouraging the existing customers to consume more. However, price dispersion that results from product heterogeneity, convenience-seeking user behaviour, consumer awareness, retailer brand equity and trust, and higher switching costs leads to inefficiency in Internet markets. Thus, the pricing strategies suitable for information products differ from that for physical goods - price discrimination and product bundling being two commonly and successfully used pricing strategies for digitized information products.
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