The factor common to successful low-cost models, our work suggests, is neither strongenforcement against pirates nor the creative use of digital distribution, but rather the presenceof firms that actively compete on price and services for local customers. Such competition isendemic in some media sectors in the United States and Europe, where digital distributionis reshaping media access around lower price points. It is widespread in India, where largedomestic film and music industries dominate the national market, set prices to attract massaudiences, and in some cases compete directly with pirate distribution. And it is a small butpersistent factor in the business software sector, where open-source software alternatives (andincreasingly, Google and other free online services) limit the market power of commercialvendors.
From the SSRC report just released.