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Strategic Management
, Sixth Edition
Charles W. L. Hill, University of Washington
Gareth R. Jones, Texas A&M University
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Case Discussion Questions
Discussion Questions for Case 7--Napster
- What are the economics of the music recording business?
- Do the big five music recording companies have market power? If so, where
does this power come from? Was this market power starting to erode prior
to the arrival of Napster?
- Does file-sharing technology over peer-to-peer networks have the characteristics
of a disruptive technology? What are the implications of this technology
for the market power and growth prospects of established music recording
companies? How might this technology, including variations developed by established music companies, "disrupt" the industry?
- What are the implications for the music recording business of widespread
violation of intellectual property rights? Do new digital technologies increase the potential piracy rate? Why?
- How did Fanning come up with the original idea for Napster? What does this
tell you, if anything, about the birth of entrepreneurial organizations? Was Shawn Fanning an insightful business thinker or accidental entrepreneur?
- Why did peer-to-peer technology suddenly come to the fore in the late 1990s?
What explains the extraordinary early growth of Napster?
- In retrospect, what mistakes did Napster make? How might things have been
done differently?
- Do you think the business model proposed by Barry was potentially viable?
What flaws can you see in it? How might it be improved?
- What are the lessons that Napster holds for the established labels in the
music recording businesses?
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