Review
Review the assigned reading to prepare for this discussion.
The authors of the articles below provide some additional perspectives on managing relationships within the industry.
Vertical Integration Is Dead, or Is It? (opens in a new window)
Managing Supply Chain Risks and Vulnerabilities Through Collaboration: Present and Future Scope (opens in a new window)
Simulation: Platform Wars: Simulating the Battle for Video Game Supremacy (opens in a new window)
Read the Sony’s Battle for Video Game Supremacy case study to learn more information about the video game industry and your firm.
Launch the Platform Wars: Simulating the Battle for Video Game Supremacy simulation.
Select the Instructional Video button to learn more about how to interact with the simulation.
Select the Play Simulation button to start the simulation.
Select Play as an Individual and enter a screen ID.
To play the simulation, use the firm and industry information presented to make your firm decisions for the current year including the console price, game titles to subsidize, and royalty paid by game makers. You can also decide how long the pricing strategy will be implemented. To complete the simulation, you have to implement a pricing strategy that will account for a 10-year period. The number of rounds are dependent on how long you will implement each decision.
Using the simulation, assume that you are part of senior management at a video game hardware platform producer. The firm competes in a multi-sided market that is affected not only by product demand and price, but also product ownership and complementary products. You will price your product through 10 years based on the firm and industry information presented.
Respond
Complete the simulation, then share your experience:
Visually share your firm’s data at the end of the 10th year using tables, graphs, or by using your computer’s screen capture tool, including:
Your market share, cumulative profit, console price, royalty (% of game revenue), games subsidized, games available
Market share and cumulative profit graphs from your dashboard
Explain your pricing strategy based on the firm and industry information presented to you, including:
How did product development, through the number of games subsidized and games available, affect your pricing strategy?
How did the relationship with the game makers, through the paying of royalties, affect your pricing strategy?
Describe some additional social, legal, and ethical challenges that senior management will be facing in both domestic and global markets.
