Product Boundaries of the Software Market Within the Context of Competition Policy

Abstract

The article analyses the main features of the intellectual activity results market through the lens of the product boundaries definition. Frequently the pirated copy is not considered as a substitute for original products in legal cases. However, unlicensed computer programs should be included in the product market boundaries regardless of its legal status if the consumer considers them as substitutes. The difference between these types of products (original and pirated) are hidden not in transformation but in transaction characteristics. It is also important to take into consideration the possible complementarity between pirated and original products expressed in the information and network effects. In order to assess the buyers’ choice it is necessary to adjust the methods evaluating product market boundaries prescribed by «The Procedure of market competition analysis» of the Russia’s Federal Antimonopoly Service.