Podcast
Questions and Answers
What is a key factor in determining a firm's likelihood of success in an industry?
What is a key factor in determining a firm's likelihood of success in an industry?
- The size of the firm's investment in new technology
- The timing of the firm's investment in new technology development (correct)
- The industry's market size and growth potential
- The firm's experience in the industry
What is a characteristic of an industry with increasing returns to adoption?
What is a characteristic of an industry with increasing returns to adoption?
- A single dominant design is unlikely to emerge
- Early providers have a disadvantage in the market
- The market is highly competitive and fragmented
- A technology that is adopted early may rise in market power (correct)
What was the outcome of IBM's adoption of Intel's 8088 microprocessor in its PC introduction?
What was the outcome of IBM's adoption of Intel's 8088 microprocessor in its PC introduction?
- Intel's product was discontinued
- Intel's dominant position was secured (correct)
- Intel's dominant position was threatened
- Intel's market share remained steady
What was the significance of Bill Gates and Paul Allen's development in 1975?
What was the significance of Bill Gates and Paul Allen's development in 1975?
How were applications developed for BASIC optimized?
How were applications developed for BASIC optimized?
What is a common outcome of self-reinforcing positive feedback mechanisms in an industry with increasing returns to adoption?
What is a common outcome of self-reinforcing positive feedback mechanisms in an industry with increasing returns to adoption?
What is the significance of being an early provider in an industry characterized by increasing returns to adoption?
What is the significance of being an early provider in an industry characterized by increasing returns to adoption?
How did the adoption of Intel’s architecture by computer enthusiasts contribute to Intel’s success?
How did the adoption of Intel’s architecture by computer enthusiasts contribute to Intel’s success?
What role did IBM play in securing Intel’s dominant position in the market?
What role did IBM play in securing Intel’s dominant position in the market?
What is the relationship between the development of new technology and the likelihood of a firm’s success in an industry with increasing returns?
What is the relationship between the development of new technology and the likelihood of a firm’s success in an industry with increasing returns?
What is the significance of Ted Hoff’s invention of the first microprocessor in 1971?
What is the significance of Ted Hoff’s invention of the first microprocessor in 1971?
How did the development of BASIC by Bill Gates and Paul Allen contribute to Intel’s success?
How did the development of BASIC by Bill Gates and Paul Allen contribute to Intel’s success?
Study Notes
Timing of Investment in New Technology
- Investment timing is critical to a firm's success in an industry with dominant design pressures
- Early adoption of technology can lead to powerful advantages through self-reinforcing positive feedback mechanisms
Increasing Returns to Adoption
- Early adoption can culminate in a technology becoming the dominant design
- Market power increases through self-reinforcing mechanisms
Intel's Dominant Position
- Intel's Ted Hoff invented the first microprocessor in 1971
- Bill Gates and Paul Allen demonstrated the microprocessor's capabilities with BASIC in 1975
- Gates's BASIC became widely circulated among computer enthusiasts
- Applications developed for BASIC were optimized for Intel's architecture
- IBM's adoption of Intel's 8088 microprocessor in its PC introduction secured Intel's dominant position
- Each of Intel's subsequent generations of products set the market standard
Timing of Investment in New Technology
- Investment timing is critical to a firm's success in an industry with dominant design pressures
- Early adoption of technology can lead to powerful advantages through self-reinforcing positive feedback mechanisms
Increasing Returns to Adoption
- Early adoption can culminate in a technology becoming the dominant design
- Market power increases through self-reinforcing mechanisms
Intel's Dominant Position
- Intel's Ted Hoff invented the first microprocessor in 1971
- Bill Gates and Paul Allen demonstrated the microprocessor's capabilities with BASIC in 1975
- Gates's BASIC became widely circulated among computer enthusiasts
- Applications developed for BASIC were optimized for Intel's architecture
- IBM's adoption of Intel's 8088 microprocessor in its PC introduction secured Intel's dominant position
- Each of Intel's subsequent generations of products set the market standard
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Description
Understand the importance of timing in adopting new technology and how it can lead to market power and dominant design. Learn about the role of self-reinforcing mechanisms and how companies like Intel have leveraged them to achieve success.
