MGT/P 296, Competitive Strategy in Network and Information Industries

Course Syllabus: PDF file (Updated: March 13, 2009. Any further revisions will be marked in color in the PDF file.)

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Course Theme and Objectives

Networks - comprising physical, electronic, or virtual linkages - are fundamental to information technology goods - hardware, software, online information goods, Internet and telecommunications services, consumer electronics, entertainment and media products. They are also crucial components of traditional sectors such as health care, banking, services, biotechnology, transportation and energy. Networks play a distinctive role in business decisions and strategy, oftentimes posing unique and significant problems. Common to all networks are externalities, complementarities, economies of scale and scope, compatibility, and standards; many network goods also serve as platforms that enable two distinct user groups to interact.

This course helps you understand the these characteristics and their impact on strategic interactions among firms and consumers. For example: Why do firms in the IT industry give away their best products free? Why is software typically so defective? How can a gasoline station manage to charge substantially higher price than an identical one just across the street? Why do makers of video gaming consoles subsidize end users (but tax game developers) while computer operating system makers subsidize software developers (but overcharge end users)? How should you price a new technology that is far costlier to make than the existing alternative, but delivers higher lifetime value to the buyer? Why did Sony win the Blu-Ray format war against HD-DVD which was sponsored by a whole array of companies? The course examines questions such as these through a combination of simple but rigorous analytical models, emerging theories, and plenty of real-world examples, experiences, and formal cases.