Disadvantages of the first mover involve its ability to “free ride” on the first mover’s distinctive investments. Under free-rider effects, there are lots of weaknesses that can be identified. The late mover has been capable of “free ride” on matters that relate to the investment of the firm. In almost all the industries, imitation should not be confused with a price-cutting strategy (Capon, 2009, p. 146) though its costs are often lower than innovation costs.
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For example, some imitation strategies have proven to be very successful in every market (Shankar & Carpenter, 2012, p. 364). Nevertheless, the innovators may be able to enjoy some monopolies over the industries that imitate their products.
Much attention has been attracted to the theories in the literature (Kazmi, 2008). The theoretical literature focuses mainly on the implications of free-rider impacts regarding the spillovers of information and productivity improvement. The weakness of the first movers falls on the fact that the late movers took advantage to enjoy benefits created by the first movers. The late movers do hire the trained workmanship at a lower cost, thereby demeaning the works of the first movers. The weakness results in the fact that the second achiever receives what it has never worked for (Kazmi, 2008).
Sony’s failure in the MP3 industry
Indeed, Sony has never failed to expand its instinct domination from portable cassette and CD players to the very mp3 because of timing. Sony, as a matter of fact, always lacked vision. They made an effort to enter the mobile market and succeed there making the common mobile music sound like on any other electrical device. Apple went on and disapproved of the first mover as the market really wanted something meaningful and delightful, especially in terms of music conception. What brings the distinction between the two companies does not stretch out on the hardware (Kazmi, 2008). It is the software that creates a gap in market competence.
The Sony Company cannot be compared with the Apple Company. Sony Company seemed reluctant by manufacturing frustrating and confusing hardware. Sony Company found it difficult to improve its technology and implement the new changes that were unfolding. Sony Company assumed that they had done a lot in terms of technology. They were appreciated for having done a lot in hardware matters. But on the contrary, the hardware does not matter. What matters in terms of technology improvement is software production (Kazmi, 2008).
Advantages of late mover Apple
The late mover, Apple, having obtained the necessary skills through their pioneers utilized the opportunity to advance on their software production. They managed to disconnect consumers from the physical materials through the introduction of the new interface that was unique and admirable. The locking of their products ensured a great reduction in illegal acts of piracy. Now, Apple owns almost everything on matters that are related to screen and music MP3 advancement (Kazmi, 2008).
Apple Company has tried by all means to reduce the cost of its products through the support system of OS. Apple customers can transfer the content on upgrading and replacing lost and stolen products. They have a strong balance sheet that allows access to a vast network of resources. The company is capable of deploying a wide range of the network. Very few companies are capable of deploying such a wide network coverage (Chang, 2011).
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Apple is also capable of deploying a small percentage of its market. It has developed an organized consumer environmental niche. The large market does not matter as the company managed to put advancement in the MP3 industry. No brand has managed to produce MP3 IPod phones that may be compared to Apple Company’s ones (Chang, 2011).
Capon, N 2009, Capon’s marketing framework, Wessex Publishing, Bronxville, N.Y.
Chang, S-J 2011, Sony vs Samsung the Inside Story of the Electronics Giants’ Battle for Global Supremacy, John Wiley & Sons, Hoboken.
Kazmi, A & Kazmi, A 2008, Strategic management and business policy, Tata McGraw Hill Education, New Delhi.
Shankar, V & Carpenter, GS 2012, Handbook of marketing strategy, Edward Elgar Publishing, Massachusetts.