1. Is DoCoMo wise to offer its existing mobile phone rivals access to FeliCa?
To simply answer this question, yes. FeliCa Networks, Inc. is split owned by Sony, DoCoMo and JR East. This means that DoCoMo will earn a portion of the revenues made by FeliCa. So by offering FeliCa to their rivals, DoCoMo will expand their sources of revenue by increasing FeliCa customer base. First, they will receive a licensing fee from the mobile phone carriers and by expanding this service to them will dramatically increase their income pool. Secondly, FeliCa will receive a fee whenever a user downloads an application through the network, in addition to other transaction fees. It is hard to say if this will have some negative effects for DoCoMo because they have free access to the network giving them a competitive advantage other their competitors.
2. Is search a winner-take-all business?
In a winner-take-all business usually has a dominant player in which controls the market. In order to control the market, they would need to have a superior product or technology. This is very similar to NASCAR, where the dominant car usually has the best technology available and at the end of the day is champion. Now looking at the search industry, we find that there are several major players, such as Google, Yahoo, Ask, and so on. By having so many players is market, it lowers switching and homing costs for the end user. While it may be that Google is the industry leader by a large margin, I don’t see it as a winner take all industry unless their search technology is so far advanced that it steals the entire market and I do not see that happening.
Wednesday, February 25, 2009
Thursday, February 19, 2009
Online Gaming - EA case
Since the writing of the Electronic Arts Case the Sony Playstation 3 and the Nintendo Wii have been released and both have online gaming capabilities. What’s your assessment of the current online gaming market?
The current online gaming market is not only a huge and growing market segment but comes with tremendous profit potential. For this reason, we have seen Sony, Microsoft and Nintendo jump into the industry that has largely been dominated by the PC by offering online capabilities with their consoles. While each console and PC has their advantages and disadvantages, it is clear that the PC is still the market leader because of games like World of Warcraft and Second Life. With that being said, the success of a particular console is correlated with the success of the online games it carries. Examples of these successes are Microsoft with the Halo series and Playstation with Final Fantasy. Moving forward, I think the mark of truly great games will be determined by how well they perform in the online environment.
The current online gaming market is not only a huge and growing market segment but comes with tremendous profit potential. For this reason, we have seen Sony, Microsoft and Nintendo jump into the industry that has largely been dominated by the PC by offering online capabilities with their consoles. While each console and PC has their advantages and disadvantages, it is clear that the PC is still the market leader because of games like World of Warcraft and Second Life. With that being said, the success of a particular console is correlated with the success of the online games it carries. Examples of these successes are Microsoft with the Halo series and Playstation with Final Fantasy. Moving forward, I think the mark of truly great games will be determined by how well they perform in the online environment.
Thursday, February 12, 2009
Netflix
Since the publishing of this case, Netflix has entered the video on demand (VOD) market. What is your analysis of how Netflix has attempted to update their business model with VOD?
By entering into the video on demand (VOD) market, Netflix is trying stay on the cutting edge of video technology. Over the years, they have grown into a very successful video rental business by giving their customers what they want at a flat monthly fee. However, their success is being threatened with the emergence of VOD, just as DVD’s have eliminated the need for VHS. The management of Netflix has realized this and has created a company that is very flexible and can easily adapt to the changing business environment. A good example of this ability is their proprietary recommendation system, which allows the customer to personalize and rate movies; enhancing their movie experience. Furthermore, by catering to the needs of the customer, Netflix has been able to develop a strong brand presence. Moving forward, Netflix is entering into a highly competitive market where understanding the needs of the customer and having a strong brand will play a key role in the industry. By investing in research and development and seeing the trends in the market, the management has positioned Netflix well and provided themselves with several opportunities. The bottom line is the management is very flexible and accepting of changes in the industry, which will help them to stay on top.
By entering into the video on demand (VOD) market, Netflix is trying stay on the cutting edge of video technology. Over the years, they have grown into a very successful video rental business by giving their customers what they want at a flat monthly fee. However, their success is being threatened with the emergence of VOD, just as DVD’s have eliminated the need for VHS. The management of Netflix has realized this and has created a company that is very flexible and can easily adapt to the changing business environment. A good example of this ability is their proprietary recommendation system, which allows the customer to personalize and rate movies; enhancing their movie experience. Furthermore, by catering to the needs of the customer, Netflix has been able to develop a strong brand presence. Moving forward, Netflix is entering into a highly competitive market where understanding the needs of the customer and having a strong brand will play a key role in the industry. By investing in research and development and seeing the trends in the market, the management has positioned Netflix well and provided themselves with several opportunities. The bottom line is the management is very flexible and accepting of changes in the industry, which will help them to stay on top.
Thursday, February 5, 2009
P2P Vs ITunes
Week 2 Blog
Who will win the competitive battle between P2P file sharing networks and iTunes over the long run and why?
Over the long run P2P would win the competitive battle over iTunes because it is a more flexible and adaptable network. In the last ten years, the music industry has tried to stop P2P but has failed because the protective measures like DRM’s can be broken. Furthermore, P2P serves a large population than iTunes. iTunes is restricted to Ipod’s or other apple applications, while P2P can be used by everyone. Additionally, P2P is free and offers a wider selection, while iTunes is more stable and easier to use. With that being said, I think P2P would win over iTunes. However, I think P2P and iTunes serve two different market segments. P2P is for people who are knowledgeable about computers and want higher quality, while iTunes users want easy access to files and are less tech savvy.
Who will win the competitive battle between P2P file sharing networks and iTunes over the long run and why?
Over the long run P2P would win the competitive battle over iTunes because it is a more flexible and adaptable network. In the last ten years, the music industry has tried to stop P2P but has failed because the protective measures like DRM’s can be broken. Furthermore, P2P serves a large population than iTunes. iTunes is restricted to Ipod’s or other apple applications, while P2P can be used by everyone. Additionally, P2P is free and offers a wider selection, while iTunes is more stable and easier to use. With that being said, I think P2P would win over iTunes. However, I think P2P and iTunes serve two different market segments. P2P is for people who are knowledgeable about computers and want higher quality, while iTunes users want easy access to files and are less tech savvy.
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