Tuesday, September 28, 2010
Saturday, September 25, 2010
Time Warner will begin testing a new video-on-demand service that will allow consumers to watch movies at home 30 to 60 days after the initial theater release.
Pricing this service will be a challenge. The CFO estimates that customers would be willing to pay $20-$30 to watch a newly released movie at home.
How should Time Warner price this new service to capture as much consumer surplus as possible?
Tuesday, September 21, 2010
Interesting article from the NYTimes, “Why Bricks and Clicks Don’t Always Mix” . This article illustrates how Netflix is competing with Blockbuster in the video rental business with a cost and operational advantage. With Netflix moving toward streaming movies over the Internet, they are aiming to reduce their costs even further. Will Blockbuster be able to keep up?
Monday, September 20, 2010
Broadcast TV shows once commanded a hefty premium for reselling their content on cable networks. With more and more cable networks producing their own original content, broadcast TV can turn to the Internet to monetize their content. After all, broadcast TV has already spent a significant sum to produce original content.
Can broadcast TV unlock the value of old TV shows on the Web?
If yes, should they redistribute this content by building their own online distribution platform or partner with existing online networks (e.g. Hulu)?
Thursday, September 16, 2010
Amazon recently acquired this startup that sells music online using dynamic pricing. What are some of the advantages/disadvantages of their pricing strategy? What type of pricing would you prefer if you were a music artist? Amazon?
On Amie Street, the community determines the price of music. Every song starts cheap (or even free!) and increases in price up to 98 cents as more and more people purchase it.
Tuesday, September 14, 2010
“We’re producing data at an amazing rate. In fact, humans generated more data in 2009 alone than in the entire history of our species up to that year, according to Amazon’s former chief scientist Andreas Weigand. And IT firm EMC projects the quantity of digital information we produce will grow by a factor of 44 between 2009 and 2020.”
Ken Elefant of Opus Capital outlined three market trends that startups are using to enter what he calls the "big data" markets:
- Data Accessibility
- Data Control
- Better Tools, Better Business Insights (Analytics)
Startups have recently gained ground by providing a business model that uses at least one of these three methods. Although this is the current trend of monetizing vast amounts of data, what does the future hold for data driven startups?
Saturday, September 11, 2010
Friday, September 10, 2010
Thus begins a fascinating article at Bloomberg Business Week. Pricing strategies like these are especially important for information goods and in a world of well-informed consumers. In fact, if anything, the article overemphasized the psychology of pricing and underestimates how these strategies can be very effective even when consumers are entirely rational.
Next time you're sitting at an airport bar and hear two businesspeople debate whether Apple is a technology or design company, chime in: "Nope. What Steve Jobs sells is pricing."
Pricing? You bet.
Jobs is a master of using pricing decoys, reference prices, bundling and obscurity to make you think his shiny aluminum toys are a good deal. Apple's Sept. 1 announcement of new products was a classic example.
The popular iPod Touch media player has been revamped at three price points - $229, $299, and $399 - all costing more than the iPhone, which does everything the Touch can plus make phone calls.
What gives? Watch Apple, and you can learn pricing tricks for your own business.
Apple recently reversed its earlier decision to restrict third-party developer tools to be used to build iPhone applications. Now, software developers can use Adobe’s Packager for the iPhone, which helps software developers transform Flash applications to the iPhone format.
It is interesting to note that while software developers can now use the Adobe Packager, they are still restricted from delivering pure Flash applications for the iPhone. Why is Apple restricting the Flash Platform from the iPhone? Is this decision technical, political, or just business?
Wednesday, September 8, 2010
Google has just announced a new search enhancement that promises to “change the way you search”. Will this new enhancement fundamentally change the way we search? Or is it just a small feature enhancement with great marketing buzz?
Wednesday, September 1, 2010
Yesterday, I wouldn't really have considered Facebook and Apple competitors, but today's announcement of Ping may change that.
Facebook has a huge social network platform, but has been struggling to monetize it. Apple has a powerful payment and content platform, but no significant social network.
Which position would you be rather be in?