The Impact of Standards Competition on Consumers--论文代写范文

在市场发展的早期阶段,竞争对手可能同时引入不相容的专利技术产品。标准竞争也可能发生，因为拒绝新技术的进入，因为成本的兼容性,以至于进入者更愿意引进自己的技术。下面的essay代写范文进行论述。

Introduction
  With the rapid development of information technology and the digital revolution, technological standards have an increasingly important effect on the success of many new products and services, including computers, electronic video games, wireless communication, home networking, video/audio electronics, banking services, and the Internet (Katz and Shapiro 1994). A common feature of markets in which technological standards have become so important is that the consumption utility of a product or service increases with the number of people who use it. Economists call this demand interdependence “network externalities” (Farrell and Saloner 1986; Katz and Shapiro 1985) or “network effects” (Chou and Shy 1992). 

  Standards competition is common in the presence of network effects because the product feature that creates the network usually requires a technical protocol, which is often patent protected. In the early stages of market development, competitors may simultaneously introduce products based on incompatible patented technologies. Standards competition may also occur either because an incumbent refuses to license its technology to a new entrant or because the cost to achieve compatibility is so high that the entrant prefers to introduce its own technology. 

  Over the past two decades, there have been many fierce standards battles between incompatible technologies (Shapiro and Varian 1998). Some well-known examples are those for the VCR between Matsushita’s VHS and Sony’s Betamax formats, for streaming audio and video software between Microsoft and RealNetworks, for 56k modems between 3Com and Rockwell/Lucent, and for Internet browsers between Microsoft and Netscape. In addition, there are many ongoing standards battles in various new product markets, such as home networking, wireless communication, expansion devices for portable electronics, online music-sharing software, recordable DVD, ultra wideband, and digital music. Standards battles and network effects have generated a considerable amount of research.

  For example, economists have examined the social welfare implications of standards competition and have analyzed associated issues of regulatory policy (e.g., Economides 1996; Farrell and Saloner 1986; Katz and Shapiro 1985). Researchers have also explored strategic issues, such as pricing (Dhebar and Oren 1985), compatibility (Xie and Sirbu 1995), upgrades (Padmanabhan, Rajiv, and Srinivasan 1997), complementary products diffusion (Gupta, Jain, and Sawhney 1999), diffusion acceleration (Van den Bulte 2000), asymmetric network effects (Shankar and Bayus 2003), product line (Sun, Xie, and Cao 2004), cross-market network effects (Chen and Xie 2003), pioneer survival (Srinivasan, Lilien, and Rangaswamy 2004), indirect effects (Nair, Chintagunta, and Dubé 2004), and intrastandard competition (Wang and Xie 2005). 

  Although existing research has examined standards battles from both societal and firm perspectives, the consumer’s perspective has received little attention. The literature has provided little theory or evidence on how consumers might behave in markets with standards battles. Compared with other markets, those with standards battles exhibit certain fundamental characteristics that make the consumer’s new product adoption decision more risky and complex. First, the expected utility of product adoption in these markets is largely determined by the standard’s future installed base, which is highly uncertain in the early stages of the standard’s introduction. Second, the adoption decision is also more complicated because consumers often must choose not only among brands but also among competing technological standards (e.g., Nintendo versus Sega systems for video game players, DVD versus DivX systems for digital videodisk players, Apple’s iTunes versus Microsoft’s MSN Music for online music). 

  Finally, adoption of a “losing” standard can be costly to consumers (e.g., to owners of the Betamax VCR and the DivX digital video player). For these reasons, consumers may behave differently in markets with standards battles than in those without. They may search for different types of information, use different criteria to evaluate and compare alternatives, engage in different decision-making processes, and respond differently to advertising. Another limitation of research on standards competition and network effects is the dearth of research on firm communication strategies. Given the high uncertainty and extreme complexity of consumers’ adoption decisions in markets with standards battles, it is crucial for firms to communicate effectively with consumers about the value of their products and to build consumer confidence in their future market growth.

  In this article, we ask and answer four specific research questions: (1) Does standards competition affect the likelihood of consumer new product adoption? (2) Does standards competition affect the importance that consumers place on different types of performance-related product information? (3) Because advertising is often used to convey performance-related information, how does standards competition affect consumer response to various advertising formats, and which advertising format is most effective in winning a standards battle? and (4) Does consumer familiarity with the advertised and comparison brands moderate the effectiveness of various advertising formats in markets with standards competition? To address these questions, we designed three studies. 

  Study 1 was motivated by the commonplaceness of expressing consumption utility in both absolute and relative terms. We examine the effect of standards competition on consumers’ adoption decisions and the relative importance in such decisions of two types of performance-related information: absolute and relative product performance. Building on the results from Study 1, Study 2 investigates the interaction between standards competition and the effectiveness of three different advertising formats: direct comparative, indirect comparative, and noncomparative. Study 3 investigates the moderating effect of consumer brand familiarity on the effectiveness of advertising formats in markets with competing standards. We discuss the three studies in the next three sections. After presenting the results of the three studies, we conclude by summarizing our findings, interpreting their implications, and discussing limitations and avenues for further research.

  The second and more important issue in Study 1 pertains to the effect of standards competition on the importance that consumers place on different types of performance-related product information. Often, consumers actively seek information about the performance of products they intend to buy to predict the consumption utility of those products. Consumption utility can be expressed in both absolute and relative terms, as economics and decision-making research have clearly shown. Absolute utility, which is sometimes described as “choiceless” utility (Loomes and Sugden 1982), is the utility associated with the consumption of a particular good, independent of other available alternatives. Relative utility is the differential consumption utility of a good relative to other available alternatives. Utility theory suggests that when consumers face two alternative product offerings, X and Y, they will choose Product X if two conditions hold: (1) a positive absolute utility of X and (2) a positive relative utility of X over Y.

  Information about product performance can help consumers evaluate the two utility conditions, and this information also can be expressed in absolute or relative terms. In general, consumers value information about both absolute and relative performance of a product because it is predictive of the product’s underlying absolute and relative utility. However, we propose that consumers give greater weight to information about the relative performance of a product in the presence of standards competition than in its absence. Findings from several streams of literature suggest that in the face of uncertainty, decision makers become considerably more sensitive to information that compares choice alternatives. 

  For example, the reason-based choice paradigm suggests that in the face of uncertainty, decision makers tend to evaluate the consequences both of choosing one alternative and of forgoing the other (Inman, Dyer, and Jia 1997; Shafir and Tversky 1992). Regret theory (e.g., Loomes and Sugden 1982) and the literature on decision making under uncertainty (e.g., Lipshitz and Strauss 1997) also make similar claims. Likewise, in the face of standards competition, consumers often are uncertain about which of the competing products will eventually win the battle. It is likely that consumers resolve such uncertainty by carefully weighing the pros and cons of adopting one standard over another. Thus, information about the relative performance of a product should have a greater impact on consumer adoption decisions in the presence of a standards war than in its absence.（essay代写)

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