
Six strategies for overcoming "chicken and egg" problems - Laurentvw
http://www.cdixon.org/?p=334
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rrikhy
5 is something that Joshua Porter strongly emphasizes in his "Psychology of
social design" talk. REALLY IMPORTANT for my startup. Give a read:
<http://bit.ly/1J00n>

"...Providing a stand-alone use is the strategy that VCR producers used to
achieve a successful launch and avoid fighting the difficult chicken and egg
startup problem. Unlike the VDP, the VCR offered the ability to time-shift
television programming. In fact, when the VCR was launched this was the only
application available because the market for pre-recorded videocassettes had
not yet developed. The standalone value for the VCR “time-shifting television
programming” was sufficiently strong to get over a million people to purchase
the product in the first 3-4 years after its launch. "

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skmurphy
Key advice for where to start:

3\. Exploit irregular network topologies. In the last 90s, most people assumed
that dating websites was a "winner take all market" and Match.com had won it,
until a swath of niche competitors arose (e.g. Jdate) that succeeded because
certain groups of people tend to date others from that same group. Real-life
networks are often very different from the idealized, uniformly distributed
networks pictured in economics textbooks. Facebook exploited the fact that
social connections are highly clustered at colleges as a "beachhead" to
challenge much bigger incumbents (Friendster). By finding clusters in the
network smaller companies can reach critical mass within those sub-clusters
and then expand beyond.

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jwilliams
When Philips invented the cassette tape - they opened it up completely. If you
called Philips they would give you designs, tell you what manufacturing
equipment was required - even where to source the equipment and materials.

Philips ended up with a decent percentage of a massive market - as opposed to
100% of a niche (perhaps non-existent) market.

They took a similar strategy with the CD.

~~~
skmurphy
They also made money on the cassette tape recorders/players.

This Sony history implies that royalty free was more of a negotiated outcome
than a strategy: <http://www.sony.net/Fun/SH/1-17/h1.html>

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chinmi
thanks! that makes much sense..

I will also be writing my master dissertation on this subject, so I was glad
to find a bibliography at the end of your paper. It’s quite hard to find good
reference material on the topic. Thanks again!

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byoung2
Very useful advice! Now, I just have to put these ideas into action for a
project I've had on the backburner for a while...

