Book contents
- Frontmatter
- Contents
- List of figures
- List of tables
- List of cases
- Preface
- Part I Getting started
- Part II Market power
- Part III Sources of market power
- Part IV Pricing strategies and market segmentation
- Part V Product quality and information
- Part VI Theory of competition policy
- Part VII R&D and intellectual property
- Part VIII Networks, standards and systems
- Part IX Market intermediation
- Appendices
- Index
Part VIII - Networks, standards and systems
- Frontmatter
- Contents
- List of figures
- List of tables
- List of cases
- Preface
- Part I Getting started
- Part II Market power
- Part III Sources of market power
- Part IV Pricing strategies and market segmentation
- Part V Product quality and information
- Part VI Theory of competition policy
- Part VII R&D and intellectual property
- Part VIII Networks, standards and systems
- Part IX Market intermediation
- Appendices
- Index
Summary
Introduction to Part VIII: Networks, standards and systems
Information products and technologies are rarely used in isolation or just for their own sake. Most of the time, they have to be combined with a number of other complementary products or technologies to provide their users with some utility. Take the example of an instant messaging (IM) software (like AOL Instant Messenger, Yahoo! Messenger, or Microsoft MSN, now Windows Live, Messenger). Most instant message services allow you (i) to send messages to another user across the Internet in real time, (ii) to set up individual chat rooms with people you choose to talk to, (iii) to exchange files, (iv) to check your email, and (v) to access pre-selected websites. From the description of the service, it appears clearly that the acquisition of an IM software involves a larger set of considerations than the purchase of, say, a bag of potatoes. Let us examine why.
First, the user has to look further than the present acquisition of a single product: what she really cares about is a stream of (past and future) purchases or investments. For example, an IM software is often bundled with a particular web browser, which makes the acquisition of the two products interdependent. Moreover, the user will have to spend some time and energy to learn to work with a particular IM software; this can be seen as an investment in some form of specific human capital.
- Type
- Chapter
- Information
- Industrial OrganizationMarkets and Strategies, pp. 545 - 548Publisher: Cambridge University PressPrint publication year: 2010