ABSTRACT

This chapter extends the analysis to consider nonpricing strategies that can delay or prevent entry. According to Economides: The essential argument is that once consumers purchased their new computers with the Internet Explorer already installed, few would pay the costs associated with installing and learning to use another browser. The policy obviously had its greatest impact on Microsoft's large Internet browser rival, Netscape, whose browser market share, as we showed in, plummeted after Microsoft began requiring computer manufacturers to install its Internet Explorer with its Windows95 operating system. The introduction of personal computers, IBM was a virtual monopolist in the large mainframe computer market. The Smiley study provides evidence that in the real world firms use many different methods to deter entry, and at least two of these methods appear to be diametrically opposed: keeping products or processes secret as long as possible, and announcing the product long before it is ready.