Way back in the 20th century, 1994 to be exact, a price war was raging between the Daily News and the New York Post for the price of New York’s Daily Tabloid Newspaper. The lessons of this exercise in game theory provides insight into the ongoing console wars between Microsoft, Sony, and Nintendo. In addition, Sony’s CES announcement that it will not be launching PS4 at the 2012 E3 conference (E3 is the video game industry’s largest conference) is one of the best illustrations of game theory seen in recent years.
A few weekends ago, I watched the movie version of Freakonomics (available on Netflix instant streaming here). Except for the film’s final section, “Freakonomics: The Movie” covers exactly the same topics as the first book in a more digestible format.The final section covers a test conducted at a Chicago Heights High School, exploring the question: “Can a ninth grader be bribed to succeed?”. (Note: in discussing the ideas presented, I will discuss a few ‘spoilers’ from the movie).
Without going into too much detail, the test identified underperforming students and enlisted in a program which enabled them to potentially win
‘We dropped our shorts to make more money. Hope you don’t mind.’
(this excerpt is a bit lengthy but I find the in the trenches Starbucks anecdote interesting, hopefully you find it worth it!)
. . . Now, Starbucks was hiring hundreds of specialists from the outside, many from management positions at Burger King, McDonald’s, Taco Bell, and other fast-food chains. When I joined the company, we made fun of those companies. Now, just three years later, we had been forced to hiring them. But bringing them on staff also meant changing the culture of the company, and in doing so changing the heart of the brand.
I recall . . .
As an intern sales representative in the pharmaceutical industry leading up to the 2004 Presidential elections the company I was working for had its sales force in a stupor. Everyone was deathly afraid of Kerry being elected. The consensus was that if John Kerry was elected it would mean death for our jobs.
Second post in the ‘Is Nook a Kindle Killer?’ series by Mikal Lewis.
At the conclusion of the last post on Barnes & Noble’s strategy I wrote:
What I would do if I was Barnes and Noble:
- Discover what business you’re in. You’re not in the book selling business. You decided that long ago when you let Amazon run away with online book retailing. . .
While this follow on has been delayed- lets resume there.
In a word. No.
Barnes and Noble execs (hopefully) know it, Amazon knows it. Everyone except for PC magazine knows it. But I don’t blame David Coursey’s cursory commentary, after all someone had to write the obligatory five reasons why… list.
Silicon Alley one of my favorite blogs has a good list of reasons explaining why ‘Nook is toast’ if you need a good logical reason.
But of course I’ll tackle this from the notsocommoncents perspective.
When I first heard the news Oracle – Sun merger, I had high hopes that given a quick transition there would be some interesting disruptive effects.
This immediately threatens IBM who for years have used less expensive, home-grown hardware to propel sales in higher margin enterprise software. Oracle not only acquires the hardware to implement an end to end solution, but it acquires a very extensive software platform with the crown jewels being Java and MySQL, a technology that has propelled many companies looking to expand online. Oracle also acquires Solaris/OpenSolaris and thus fulfills its needs to own its own flavor UNIX based operating system which will no doubt further antagonize Microsoft and more importantly leave Oracle less dependent on the excessive churn in the myriad distros of Linux. — Justin McDowell — Jabian Internal Blog
While the DOJ has approved the merger the European Union recently launched an antitrust investigation that will grind the close of this merger to a slow walk. IBM, HP, and Dell have been using a serious ground and pound game to lure customer scared that their platform/server of choice will not be supported by Oracle, and for good reason. Oracle has been known to raise licensing rates after a successful acquisition – and kill products not in it’s core strategy. Developers have been forking projects and exiting the building in droves.
I still think all is not lost. Oracle will still have Java, MySQL, Solaris/OpenSolaris, and Xen. I think the question we should be asking ourselves is what else in the “stack” does Oracle need to acquire before it could theoretically run your data center top to bottom, and have a significant desktop software footprint (i.e. OpenOffice). IBM, HP, and Dell might be winning in the short term sales but none have made the strategic investments to be a single source provider.
A notsocommon prediction: Oracle still wins, but not by as large of a margin if it could have closed this merger in July.