Deck 4: The Changing Competitive Environment

Question 1

Positive feedback refers to what?

A) An economic condition where the weaker gets stronger and the stronger get weaker.
B) An economic condition where the stronger gets stronger and the weaker get weaker
C) An economic condition that is completely unpredictable
D) An economic condition where nothing changes
E) Either C or D

Answer 1

An economic condition where the stronger gets stronger and the weaker get weaker

Question 2

Which of the following is not an example of a service available on the internet?

A) IM
B) RSS
C) VOIP
D) WWW
E) DHCP

Answer 2

DHCP

Question 3

Which of the following is a simple definition of the Internet?

A) A user interface
B) A place where network effects happen
C) A network of networks
D) The cable infrastructure used to connect computers
E) A connection between two or more computers

Answer 3

A network of networks

Question 4

What is the relationship between data and information?

A) Information is more precise than data
B) Information is data in context
C) Information is codified raw facts that have to be processed to become data
D) Information only exists in Transaction Processing Systems while data has to be stored in a Decision Support System
E) Information is what you know, data is what the competition has

Question 5

On Feb 24^th 2008 Toshiba announced that it would no longer produce HD DVD and conceded that Sony Blue-Ray has won the competition for dominance in the high definition DVD market. What can we conclude from this announcement?

A) The market has tipped in favor of Sony Blu-Ray and Toshiba understood that continuing to compete would be pointless
B) The high definition DVD market was not a tippy market and the strong network effects that Toshiba could leverage had dissipated
C) Until the network is saturated there is an opportunity to discover profitable niches and maintain financial viability
D) Information economics are strong in the high definition DVD market and Sony Blu-Ray was the first one to achieve critical mass of information reusability.
E) Impossible to determine from the information given.

Question 6

Which of the following is not an economic characteristic of information?

A) Low production costs
B) Low replication costs
C) low distribution cost
D) There is a high risk involved in producing information goods
E) Information goods are not consumed by use

Question 7

Network effects are associated with:

A) Supply-side economies of scale
B) Demand-side economies of scale
C) Both supply-side and demand-side economies of scale
D) Large manufacturing facilities
E) Word-of-mouth communication

Question 8

A market is likely to tip when there are:

A) Strong economies of scale and low need for product variety
B) Weak economies of scale and low need for product variety
C) Weak economies of scale and high need for product variety
D) Strong economies of scale and high need for product variety
E) Entering a period of recession in the dot-com industry as a whole.

Question 9

Information goods are not:

A) Customizable
B) Reusable
C) Reproducible
D) Easily distributed
E) Easy to produce

Question 10

In class we have used the example of eBay, Inc. as a firm that has achieved a dominant position in its market. What is the cause of its dominance?

A) eBay has achieved critical mass and has the strongest brand
B) eBay has achieved critical mass and has the lowest prices
C) eBay has achieved critical mass in a market with strong network effects
D) eBay has gotten lucky since its uses an easily copied website
E) All off the above are reasons for eBay's dominance

Question 11

A company that finds itself on the losing side of positive feedback has a few options. These include:

A) Becoming compatible with the dominant network
B) Identifying and specializing in a niche that is different enough to sustain the organization
C) Producing vaporware
D) None of the above is viable option
E) Only A and B are viable options

Question 12

Who owns the Internet?

A) The Internet is owned by the users who browse websites
B) The Internet is owned by the governments
C) The Internet is owned by the web engineers
D) The Internet is owned by millions of entities
E) The Internet is owned by the universities

Question 13

How is value created in networks?

A) Value is a function of scarcity of connected nodes
B) Value is a function of the number of connected nodes
C) Value is a function of the number of high-tech devices in the network
D) Value depends on the kinds of users in the networks
E) Value is a function of bandwidth and capital investment

Question 14

When will the positive effect associated with network effects play out?

A) Until one firm dominates the network and all other competitors disappear
B) Until the network is saturated
C) Until a competitor enters the market
D) It will never play out
E) When all competitors are of approximately the same size

Question 15

Which of the following companies is/are not in a tippy market?

A) eBay.com
B) Resort Condominiums International, LLC
C) Buy.com
D) Skype
E) LinkedIn.com

Question 16

What is a two-sided network?

A) A network that has two kinds of devices
B) A network that connects a physical network and a virtual network
C) A network that connects the web designers and the web users
D) A network that has two types of members
E) A network with multiple types of node connections

Question 17

With the advent and widespread adoption of a cheaply and easily accessible information infrastructure, what happens to the "Richness and Reach Trade-Off"?

A) The trade-off between reach and richness has not been eliminated
B) The trade-off between reach and richness is increasingly being lifted
C) It depends on if the information goods are in a tippy market or not
D) Nothing will happen
E) Balance is reached quickly

Question 18

Tippy markets are associated with strong positive feedback.

Question 19

The Internet has eliminated the richness-reach trade-off.

Question 20

A sustaining technology provides the same set of characteristics with superior performance.

Question 21

A disruptive technology provides the same set of characteristics with radically superior performance.

Question 22

Managers must understand disruptive technologies by listening to their customers.

Question 23

Network value is based on the logic of value in plentitude.

Question 24

Tippy markets are characterized by a strong variety in product needs.

Question 25

The Internet is the World Wide Web which delivers many services such as email, instant messaging and etc.

Question 26

The value of a virtual network for its members is a function of its size; however, the value of a physical network depends on the scarcity of the devices comprise the physical network

Question 27

The Internet and the Web are exactly the same concepts

Question 28

The Internet is primarily using open standards

Question 29

Network economics is based on the logic of scarce resources

Question 30

Tippy markets are associated with supply-side economies of scale

Question 31

Managers are better off ignoring disruptive technologies.

Question 32

Provide some examples of internet services.

Question 33

Provide an example of a virtual network.

Question 34

Please define "positive feedback" and illustrate the concept with an example

Question 35

How can a firm that find's itself on the losing side of network effects survive?

Question 36

How can we recognize a tippy market?

Question 37

What is the difference between "classic information goods" and "information-intensive goods"?

Question 38

The fact that information has had to rely on a physical carrier limits its ability to behave accordingly to its inherent characteristics and create a trade-off between richness and reach. Please explain this "Richness and Reach Trade-Off.

Question 39

Define "sustainable technology" and "disruptive technology."

Question 40

Briefly describe the richness/reach trade-off. Provide an example of a technology that you believe is pushing the richness/reach frontier and making it possible to reach a larger number of people with information-intensive, interactive and personalized messages. Be specific in your answer!

Question 41

In what ways do classic information goods differ from information-intensive goods, and what does that mean for businesses that deal in each? Provide examples of goods, detail examples of their differences, and how each is managed differently from a business standpoint.

Question 42

Define what a disruptive technology is, list several examples and describe their effects on their respective industries, and discuss how existing firms should react when faced with new technology that may be disruptive to their industry.