Netscape, Which Once Controlled More Than 80 Percent of the Market

question 4

Multiple Choice

Netscape, which once controlled more than 80 percent of the market share in Web browsers, lost its dominant position when customers migrated to Internet Explorer, Microsoft's Web browser. Internet Explorer was easy to install and had no significant differences in terms of usability. This example serves to illustrate that:

• A) fast-following smaller firms are always ready with newer and possibly superior products.
• B) customers of technology companies are becoming increasingly savvy and more demanding.
• C) the open source nature of technology ensures that no firm can expect to monopolize a market.
• D) firms need to employ increasingly stringent intellectual property norms to guard against infringements from smaller, competitive rivals.
• E) firms with low switching costs can sometimes be rapidly overtaken by strong rivals with additional competitive advantages.

---

Definitions:

Institutional Investor

A business organization that buys and sells securities. Generally, a fund of some kind such as a mutual fund or a pension fund that invests the pooled money of its clients.

Pension Funds

Investment pools that collect and invest funds contributed by sponsors and beneficiaries to provide future pension benefits.

Insurance Companies

Businesses that provide protection against financial losses in exchange for regular payments from individuals or entities.

Product Marketing Decisions

Choices and strategies related to the promotion, distribution, design, and pricing of products to maximize their appeal to customers.