Product bundling

A software bundle might include a word processor, spreadsheet, and presentation program into a single office suite.

The cable television industry often bundles many TV and movie channels into a single tier or package.

A bundle of products may be called a package deal; in recorded music or video games, a compilation or box set; or in publishing, an anthology.

Research by Yannis Bakos and Erik Brynjolfsson found that bundling was particularly effective for digital information goods with close to zero marginal cost, and could enable a bundler with an inferior collection of products to drive even superior quality goods out of the market place.

Pursuing a bundle pricing strategy allows a business to increase its profit by using a discount to induce customers to buy more than they otherwise would have.

[17] Many companies sold multimedia upgrade kits—a CD-ROM drive, sound card, speakers, and what Computer Gaming World described as "a boatload of bundled software"—during the mid-1990s.

For a customer who already owned a TV, and in some cases a DVD player or other source for playing back movies, a HTIB package provides all of the electronics hardware, speakers and cables needed to set up a home cinema.

The most serious home theatre enthusiasts do not typically buy HTIB bundles, as they are a more sophisticated target market.

As well, a serious home theatre enthusiast may wish to have a powered subwoofer with a user-adjustable crossover, a "subsonic" filter and other higher-cost advanced features.

In oligopolistic and monopolistic industries, product bundling can be seen as an unfair use of market power because it limits the choices available to the consumer.

Bundling them together is alleged to have been responsible for Microsoft's victory in the browser wars as every Windows user had a copy of Internet Explorer.

In the early years of the cable industry this was necessary due to the technological constraints associated with allowing and blocking channels transmitted via analog methods.

The progress towards complete cable, internet, and telephone packages gave subscribers many more options as well as offering hundreds of channels.

[22] A 2018 consumer report shows many subscribers are dissatisfied with cable TV, mainly over prices, which has led to many complaints.

[23] The high price of current complete bundling, upwards of $180–200, along with poor customer service, surprise bills, and technical difficulties, resulted in Angie's List reporting that these things were the number two most complained about category.