Abstract: "Out of the recent popularity of downloadable contents (DLC)
among video game manufac-
turers has resurfaced the issue of versioning of informatio
n goods. The central idea behind
the zero-day DLC strategy is that consumers who find the base v
ersion of a game to be suffi-
ciently attractive would pay a premium to upgrade by purchas
ing such a DLC. In this work,
we combine the literature on versioning with that on product
sampling to model the impact
of consumer learning on the product-line strategy of a game m
anufacturer. In doing so, we
demonstrate that a manufacturer's desire to vertically diff
erentiate could actually stem from a
horizontal separation among consumers. When consumers diff
er in their perception of the fit
between their tastes and the features of the product, horizo
ntal differentiation seems a natural
choice. However, if the manufacturer is unable to classify p
otential consumers into groups with
distinct tastes, horizontal differentiation becomes impra
ctical. We find that, interestingly, this
inability to differentiate horizontally does not limit the m
anufacturer from vertically positioning
its product line. We characterize the conditions under whic
h the DLC strategy is effective and
discuss how it affects consumer and social welfare. Our resul
ts also have obvious implications
in markets for other digital experience goods."
Abstract: "The video game industry is a billion dollar industry with an ever-growing fan base.
Massachusetts, along with other states, has begun to take an interest in further developing this
dynamic industry. A problem facing many policy makers and economic developers is accurately
defining the video game industry, determining the types of workers that form of human capital
within its workforce and where these businesses are located. This study helps to solve this
problem by converting video game credits, found in all video games, into Standard Occupational
Codes to identify the types of workers who comprise the industry and by conducting spatial
analysis using Public Use Microdata Samples (PUMS). It also uses the Occupational Information
Network to evaluate what forms of human capital comprises the video game industry. The
results show the video game workforce comprises both creative workers such as artists and
musicians, but also computer programmers, engineers, and business management and
marketing professionals. This workforce tends to be concentrated not only in larger U.S.
metropolitan areas but also in regions with a significant high-technology workforce, college
towns, and government laboratories. Also, as this diverse workforce contains a wide variety of
skills and abilities, a common theme is being able to work together as a team to develop a
product. This study is part of a growing body of research and initiatives to identify and to locate
new, creative industries within metropolitan regions. This research will contribute to future
research using occupational analysis to identify new and growing industries."