Consider a monopolistic vendor who faces a known demand curve. By setting a price that equates marginal revenue with marginal cost, the vendor will maximize his profit. This logic holds true of both physical and digital goods. But since digitization will lower the variable production cost, it will strictly increase the profit to the vendor. Then, can we conclude that digitization always improves the vendor’s profitability? Not necessarily. Now consider what will happen on the next day of the sales. Facing deterministic demand, the physical goods vendor must have prepared the exact quantity of the product to sell, and thus all products are sold out. By contrast, the digital goods vendor will have no stock out, thanks to the nature of the digital good. Therefore, the rational vendor will try to sell more and achieve a higher profit after the sales date. To this end, the vendor will now lower the price to attract additional customers with lower reservation prices. The process will indefinitely continue. Knowing this would happen, customers will wait for the price reduction. Even the customers who would have purchased on the first day would defer the purchase until price gets lower. The digital goods vendor will anticipate this and accordingly lower the price on the first day and later, thereby compromising his profitability. Note that this downward spiral takes place as a result of digitization. Thus, digitization may not necessarily improve the profitability to the vendor. We develop an economic model to formally analyze the impact of digitization on the profitability to the vendor.

考虑一个面临已知需求曲线的垄断供应商。通过设定一个使边际收益与边际成本相等的价格，供应商将最大化他的利润。这种逻辑适用于实体商品和数字商品。但由于数字化会降低可变生产成本，因此会严格增加供应商的利润。那么，我们是否可以得出结论，数字化总是可以提高供应商的盈利能力？不必要。现在考虑销售的第二天会发生什么。面对确定性需求，实物供应商必须准备好要销售的确切产品数量，因此所有产品都已售罄。相比之下，数字商品的供应商将没有股票了，这要感谢的性质数字好的。因此，理性的卖家会在销售日期后尝试销售更多产品并获得更高的利润。为此，供应商现在将降低价格以吸引更多预订价格较低的客户。这个过程将无限期地继续下去。知道这会发生，客户会等待降价。即使是在第一天购买的客户也会推迟购买，直到价格下降。数字商品供应商会预料到这一点，并因此在第一天和之后降低价格，从而损害其盈利能力。请注意，这种螺旋式下降是数字化的结果。因此，数字化不一定能提高供应商的盈利能力。我们开发了一个经济模型来正式分析数字化对供应商盈利能力的影响。