Traditionally, the first firm to commercialize a
new technology has benefited from the unique
opportunity to shape product definitions, forcing
followers to adapt to a standard or invest in
an unproven alternative. Today, however, the
largest payoffs may go to companies that lead in
developing integrated approaches for successful
mass production and distribution.
Producers of the Beta format for videocassette
recorders (VCRs), for example, were first to develop
the VCR commercially in 1975, but producers of the
rival VHS (Video Home System) format proved to be
more successful at forming strategic alliances with
other producers and distributors to manufacture
and market their VCR format. Seeking to maintain
exclusive control over VCR distribution, Beta
producers were reluctant to form such alliances and
eventually lost ground to VHS in the competition for
the global VCR market.
Despite Beta’s substantial technological head
start and the fact that VHS was neither technically
better nor cheaper than Beta, developers of VHS
quickly turned a slight early lead in sales into a
dominant position. Strategic alignments with
producers of prerecorded tapes reinforced the VHS
advantage. The perception among consumers that
prerecorded tapes were more available in VHS
format further expanded VHS’s share of the market.
By the end of the 1980s, Beta was no longer in
production.
16. The alignment of producers of VHS format VCRs with
producers of prerecorded videotapes is most similar
to which of the following?
(A) The alignment of an automobile manufacturer
with another automobile manufacturer to adopt
a standard design for automobile engines
(B) The alignment of an automobile manufacturer
with an automotive glass company whereby the
manufacturer agrees to purchase automobile
windshields only from that one glass company
(C) The alignment of an automobile manufacturer
with a petroleum company to ensure the
widespread availability of the fuel required by a
new type of engine developed by the
manufacturer
(D) The alignment of an automobile manufacturer
with its dealers to adopt a plan to improve
automobile design
(E) The alignment of an automobile dealer with an
automobile rental chain to adopt a strategy for
an advertising campaign to promote a new type
of automobile
How is the comparsion Analgous?
Is question comparable to a CR Parallel Reasoning Question?
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