The Format War Between HD-DVD and Blu Ray Was Preceded

question 67

Essay

The format war between HD-DVD and Blu Ray was preceded by a nearly identical competition between DVD and DIVX. While DVD technology was used by a variety of manufacturers (including Sony and RCA), DIVX was a proprietary format developed by Circuit City. Both formats could play DVD movies, which cost about $30 each. However, DIVX movies (which could be played only on a DIVX player and not on a DVD player) could be purchased for $5 and viewed for 24 hours, with the ability to renew (including perpetual viewing) at a reasonable charge and a telephone call. Circuit City believed that consumers beginning to buy video disk players and disks would prefer its format since the disks were less expensive and offered convenience similar to a rental with the option of a purchase (conveniently by telephone from home) at a later date. But the DIVX format never took off, and in mid-1999, Circuit City announced that it was being discontinued. This left DVD as the dominant format for videodisks. By late 2008, Circuit City stores were bankrupt and closed. Relate this example to the model of an innovation stream and corporate attempts to gain competitive advantage through technological innovation. Explain how this competition in formats between DVD and DIVX fits the model of the innovation stream.

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Definitions:

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Individuals responsible for the management and maintenance of cemeteries, ensuring their respectful and proper operation.

Tombstones

Durable markers, typically made of stone, used to indicate the burial site of a deceased individual.

Memento Mori

Any reminder of death.

Epitaph

An inscription, often on a gravestone, in memory of a deceased person.