Evolution of Two-Sided Markets in Game Theoretic Pricing

The emergence of Smart Phones and 3G networks made the mobile phones popular for watching videos provided by service providers by taking subscription. However there is a problem in this subscription model. Due to innovative phone to phone communication technologies the subscribers are able to redistribute the content to nonsubscribers causing potential damage to revenues of the service providers. To solve this problem Lin and Liu proposed a game theoretic pricing approach to attract non-subscribers to become subscribers thus preventing the illegal redistribution of videos. They provided an analysis for equilibrium which ensures that the service provider is profited and improves QoS for subscribers further. However, they do not consider analysis of two sided markets that emerge due to the interactions between parties though one or more platforms. This paper focuses on building a prototype application which demonstrates the proof of concept of game theoretic pricing besides exploring the emergence of two sided markets and analyzing their mutual performance in presence of market dynamics. The empirical results revealed that the proposed mechanisms can help analyze two sided markets.