1 - Infoeconomy

The information economy. Information Rules: A Strategic Guide to the Network Economy by Carl Shapiro, Hal R. Varian

TESI: PER LA NEW ECONOMY CI VUOLE UNA NUOVA ECONOMIA.

The public rapidly gained access to new and dramatically faster communication technologies. Entrepreneurs, able to draw on unprecedented scale economies, built vast empires. Great fortunes were made. The government demanded that these powerful new monopolists be held accountable under antitrust law.

Note: INFORMATION TECHNOLOGY: ECONOMIE DI SCALA IMPRESSIONANTI. CHE FARE? Edit

Using the infrastructure of the emerging electricity and telephone networks, these industrialists transformed the U.S. economy, just as today’s Silicon Valley entrepreneurs are drawing on computer and communications infrastructure to transform the world’s economy.

Note: SFRUTTATA LA VECCHIA INFRASTRUTTURA DI RETE: LUCE E TELEFONI Edit

Netscape, the one-time darling of the stock market, offers a good example of how economic principles can serve as an early warning system. We’re not sure exactly how software for viewing Web pages will evolve, but we do know that Netscape is fundamentally vulnerable because its chief competitor, Microsoft, controls the operating environment of which a Web browser is but one component.... operating environment of which a Web browser is but one component.

Note: IL CONFRONTO NETSCAPE VS MICROSOFT INEGNA MOLTE COSE SU COME VANNO LE COSE IN QUESTO SETTORE, SU CHI VINCE, CHI PERDE E PERCHE’ Edit

In our framework, Netscape is facing a classic problem of interconnection: Netscape’s browser needs to work in conjunction with Microsoft’s operating system. Local telephone companies battling the Bell System around 1900 faced a similar dependency upon their chief rival when they tried to interconnect with Bell to offer long-distance service.

Note: UN PARALLELO CON L'AVVENTO DEI TELEFONI Edit

Information is costly to produce but cheap to reproduce.... Economists say that production of an information good involves high fixed costs but low marginal costs.... high fixed costs but low marginal costs.

Note: FUNZIONE PRODUTTIVA DI CHI GENERA INFORMAZIONE Edit

cost-based pricing just doesn’t work: a 10 or 20 percent markup on unit cost makes no sense when unit cost is zero. You must price your information goods according to consumer value, not according to your production cost.

Note: IL PREZZO È DETTATO DALLA DOMANDA Edit

Since people have widely different values for a particular piece of information, value-based pricing leads naturally to differential pricing.

Note: VARIABILITÀ ENORME NEI PREZZI Edit

For example, one way to differentiate versions of the same information good is to use delay. Publishers first sell a hardback book and then issue a paperback several months later. The impatient consumers buy the high-priced hardback; the patient ones buy the low-priced paperback.

Note: FONDAMENTALE LA DISCRIMINAZIONE DI PREZZO. LA STRATEGIA DEL RITARDO Edit

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DECISIVO IL TRATTAMENTO DELLA PROPRIETÀ INTELLETTUALE.

It has long been recognized that some form of “privatization” of information helps to ensure its production.

Note: PER PRODURRE OCCORRE PRIVATIZZARE Edit

There is still the issue of enforcement, a problem that has become even more important with the rise of digital technology and the Internet. Digital information can be perfectly copied and instantaneously transmitted around the world, leading many content producers to view the Internet as one giant, out-of-control copying machine. If copies crowd out legitimate sales, the producers of information may not be able to recover their production costs.

Note: MA SU INTERNET DIFENDERE LA PROPRIETÀ È COSTOSO Edit

The history of the video industry is a good example. Hollywood was petrified by the advent of videotape recorders. The TV industry filed suits to prevent home copying of TV programs, and Disney attempted to distinguish video sales and rentals through licensing arrangements. All of these attempts failed. Ironically, Hollywood now makes more from video than from theater presentations for most productions.

Note: NON MANCANO I PRECEDENTI PER CONSTATARE LE FACILI SCAPPATOIE AI VINCOLI IMPOSTIEdit

Note: SOLUZIONE: CAMBIARE MODELLO  DI BUSINESS Edit

When managing intellectual property, your goal should be to choose the terms and conditions that maximize the value of your intellectual property, not the terms and conditions that maximize the protection.

Note: SCOPO IMPLICITO: MASSIMIZZARE IL VALORE ( E NON  PROTEZIONE DI UN DIRITTO) Edit

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L'INFO È UN BENE ESPRIENZIALE

Economists say that a good is an experience good if consumers must experience it to value it.

Note: IL PROBLEMA DELL' INFO: PER SAPERE QUANTO VALE DEVO CONOSCERLA. Edit

free samples, promotional pricing, and testimonials to help consumers learn about new goods.

Note: SOLUZIONI POSSIBILI PER COMMERCIAZZARE L'INFO Edit

How do you know whether today’s Wall Street Journal is worth 75 cents until you’ve read it? Answer: you don’t.

Note: IL PROBLEMA Edit

there are various forms of browsing: you can look at the headlines at the newsstand, hear pop tunes on the radio, and watch previews at the movies. But browsing is only part of the story.

Note: BROWSING COME PALLIATIVO Edit

Most media producers overcome the experience good problem through branding and reputation. The main reason that we read the Wall Street Journal today is that we’ve found it useful in the past.

Note: ALTRA SOLUZIONE: REPUTAZIONE Edit

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IL BENE PIÙ PREZIOSO: L'ATTENZIONE.

everyone is complaining of information overload.

Note: LA LAMENTELA Edit

“a wealth of information creates a poverty of attention.” Nowadays the problem is not information access but information overload.

Note: IL MOTTO DI HERBERT SIMON Edit

The real value produced by an information provider comes in locating, filtering, and communicating what is useful to the consumer. It is no accident that the most popular Web sites belong to the search engines, those devices that allow people to find information they value and to avoid the rest.

Note: IL VERO VALORE NEL MONDO DELLA RETE È FILTRARE L' INFO NON PRODURLA Edit

In real estate, it is said that there are only three critical factors: location, location, and location. Any idiot can establish a Web presence—and lots of them have. The big problem is letting people know about it.

Note: UN PARALLELO CON LE IMMOBILIARI Edit

Web servers can observe the behavior of millions of customers and immediately produce customized content, bundled with customized ads.

Note: PUBBLICITÀ MIRATA SEMPRE PIÙ DECISIVA QUANDO L'ESIGENZA È ATTRARRE L'ATTENZIONE Edit

they can also access vast databases of information about customer history and demographics.

Note: IL TRACKING DICE TUTTO DI TE Edit

This new, one-to-one marketing benefits both parties in the transaction: the advertiser reaches exactly the market it wants to target, and consumers need give their attention only to ads that are likely to be of interest.

Note: PUBBLICITÀ MIRATA, BENEFICIO RECIPROCO… MA NON SOLO    

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INFO E TECNOLOGIA.

Infrastructure is to information as a bottle is to wine: the technology is the packaging that allows the information to be delivered to end consumers.

Note: INFO E INFRASTRUTTURA. UNA SIMBIOSI. Edit

The value of the Web lies in its capacity to provide immediate access… What’s new is our ability to manipulate information, not the total amount of information available. Mom-and-pop hardware stores of yesteryear regularly checked their inventories.

Note: LA DIFFERENZA RISPETTO A IERI Edit

Indeed, in every industry we see dramatic changes in technology that allow people to do more with the same information.

Note: IL PROGRESSO: FACCIAMO DI PIÙ CON LA STESSA INFO Edit

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LA COMPETIZIONE NELL'ERA DELLA RETE.

Traditional rules of competitive strategy focus on competitors, suppliers, and customers. In the information economy, companies selling complementary components, or complementors, are equally important. When you are selling one component of a system, you can’t compete if you’re not compatible with the rest of the system.

Note: DECISIVO PER LA COMPETIZIONE: LA COMPATIBILITÀ DEL PRODOTTO CON L'AMBIENTE ESTERNO Edit

The dependence of information technology on systems means that firms must focus not only on their competitors but also on their collaborators. Forming alliances,

Note: FORMARE ALLEANZE, ALTRO ELEMENTO FONDAMENTALE Edit

Firms have long been faced with make/buy decisions, but the need for collaboration, and the multitude of cooperative arrangements, has never been greater than in the area of infotech.

Note: MAKE/BUY DECISIONS. SEMPRE IMPORTANTE, ORA ANCORA DI PIÙ Edit

The history of the Microsoft-Intel partnership is a classic example. Microsoft focused almost exclusively on software, while Intel focused almost exclusively on hardware. They each made numerous strategic alliances and acquisitions that built on their strengths. The key for each company has been to commoditize complementary products without eroding the value of its own core strengths.

Note: UN CASO ESEMPLARE: MICROSOFT-INTEL. ALLEANZA VINCENTE Edit

Apple Computer pursued a very different strategy by producing a highly integrated product consisting of both a hardware platform and the software that ran on it. Their software and hardware was much more tightly integrated than the Microsoft/Intel offerings, so it performed better. (Microsoft recognized this early on and tried to license the Apple technology rather than investing in developing its own windowing system.) The downside was that the relative lack of competition (and, later, scale) made Apple products more expensive and, eventually, less powerful. In the long run, the “Wintel” strategy of strategic alliance was the better choice. Lock-In and Switching Costs

Note: LA STRATEGIA OPPOSTA DI APPLE: MENO ALLEANZE, INTEGRAZIKNE PIÙ DI QUALITÀ Edit

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COSTI DI CAMBIO E COSTI TRAPPOLA.

Remember long-playing phonograph records (LPs)? In our lexicon, these were “durable complementary assets” specific to a turntable but incompatible with the alternative technology of CDs. In plain English: they were durable and valuable, they worked with a turntable to play music, but they would not work in a CD player. As a result, Sony and Philips had to deal with considerable consumer switching costs

Note: UN CASO CLASSICO DI SWITCHING COST Edit

Fortunately for Sony and Philips, CDs offered significant improvement in convenience, durability, and sound quality over LPs, so consumers were willing to replace their music libraries.

Note: LA QUALITÀ NECESSARIA PER INDURRE AL SALTO Edit

As the impending problem of resetting computers to recognize the year 2000 illustrates, users of information technologies are notoriously subject to switching costs and lock-in: once you have chosen a technology, or a format for keeping information, switching can be very expensive. Most of us have experienced the costs of switching from one brand of computer software to another: data files are unlikely to transfer perfectly, incompatibilities with other tools often arise, and, most important, retraining is required.

Note: NEL MONDO IT SWITCH COST E LOCK IN SONO LA REGOLA Edit

Switching from Apple to Intel equipment involves not only new hardware but new software.

Note: ESEMPIO Edit

Lock-in can occur on an individual level, a company level, or even a societal level.

Note: UNA SOCIETÀ BLOCCATA. IL VALORE DELLA DIVERSITÀ PER DISINCAGLIARSI Edit

We explore lock-in and switching costs in Chapters 5 and 6. We’ll examine the different kinds of lock-in, strategies to incorporate proprietary features into your product, and ways to coordinate your strategy with that of your partners.

Note: MA IL LOCK IN – PURTROPPO - PUÒ ESSERE UNA STRATEGIA DI FIDELIZZAZIONE Edit

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ESTERNALITÀ DI RETE.

When the value of a product to one user depends on how many other users there are, economists say that this product exhibits network externalities, or network effects.

Note: DEFINIZIONE BENE DI RETE Edit

Technologies subject to strong network effects tend to exhibit long lead times followed by explosive growth. The pattern results from positive feedback: as the installed base of users grows, more and more users find adoption worthwhile. Eventually, the product achieves critical mass and takes over the market.

Note: CRESCITA ESPONENZIALE DELLE FETTE DI MERCATO Edit

The Internet exhibited the same pattern. The first e-mail message was sent in 1969, but up until the mid-1980s e-mail was used only by techies. Internet technology was developed in the early 1970s but didn’t really take off until the late 1980s. But when Internet traffic did finally start growing, it doubled every year from 1989 to 1995. After the Internet was privatized in April 1995, it started growing even faster.

Note: DINAMICA DEL BOOM DI INTERNET Edit

As a result, growth is a strategic imperative, not just to achieve the usual production side economies of scale but to achieve the demand side economies of scale generated by network effects.

Note: CRESCERE O MORIRE Edit

Netscape grabbed the Web browser market early on by giving away its product. It lost money on every sale but made up for it in volume.

Note: STRATEGIA: VENDERE IN PERDITA Edit

In competing to become the standard, or at least to achieve critical mass, consumer expectations are critical. In a very real sense, the product that is expected to become the standard will become the standard.

Note: DECISIVE LE ASPETTATIVE PRIMA ANCORA CHE I COMPORTAMENTI Edit

Competitive “pre-announcements” of a product’s appearance on the market are a good example of “expectations management.”... When network effects are strong, product announcements can be as important as the actual introduction of products...

Note: STRATEGIA DELL' ANNUNCIO

Product pre-announcements can be a two-edged sword, however. The announcement of a new, improved version of your product may cut into your competitors’ sales, but it can also cut into your own sales. When Intel developed the MMX technology for accelerating graphics in the fall of 1996, it was careful not to advertise it until after the Christmas season.

Note: L'ANNUNCIO: UNA SPADA A DOPPIO TAGLIO Edit

Because of the importance of critical mass, because customer expectations are so important in the area of information infrastructure, and because technology is evolving so rapidly, the timing of strategic moves is even more important in the information industry than in others.

Note: TIMING DECISIVO Edit

In November 1997 Sun took out full-page ads in the New York Times and other major newspapers reciting the long list of the members of the “Java coalition” to convey the impression that Java was the “next big thing.”

Note: L' ESEMPIO DI JAVA Edit

Adobe followed an openness strategy with its page description language, PostScript, explicitly allowing other software houses to implement PostScript interpreters, because they realized that such widespread use helped establish a standard.

Note: LE STRATEGIE DI ADOBE PER IMPORSI COME STANDARD Edit

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CONSIGLI DI POLICY.

The ongoing battle between Microsoft and the Justice Department illustrates the importance of antitrust policy in the information sector.

Note: ANTITRUST AL CENTRO Edit

Competitive strategy in the information economy collides with antitrust law in three primary areas: mergers and acquisitions, cooperative standard setting, and monopolization.

Note: TRE AREE CRITICHE Edit

As a new century arrives, the Sherman Act is flexible enough to prevent the heavy hand of monopoly from stifling innovation, while keeping markets competitive enough to stay the even heavier hand of government regulation from intruding in our dynamic hardware and software markets.

Note: CONCILIARE INNOVAZIONE E COMPETIZIONE: ECCO LA SFIDA Edit