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16 October, 07:18

Which of the following strategies should a company NOT adopt if it wants to win a format war? a. Joining forces with other companies to develop new technologies b. Charging extremely high license fee for the technology c. Aggressively marketing to jump-start demand d. Developing killer applications e. Developing complementary products

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  1. 16 October, 07:32
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    B) Charging extremely high license fee for the technology

    Explanation:

    Does anyone recall VHS or Betamax? Back in the 80s, Sony developed Betamax which was a great recording format and JVC developed VHS which was actually not that good as a recording system. Even though JVC's VHS tapes were not that good, they allowed many companies to produce them charging a low licensing fee. On the other hand, Sony thought that since they had the best product, people would simply choose them over everyone else.

    Eventually Sony lost the VCR format war since no matter how good a product is, it is really hard to fight everyone else by yourself. Even Sony ended up selling VCRs that used VHS tapes.
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