A Forecast Simulation Analysis of the Next-Generation DVD Market Based on Consumer Preference Data

Jongsu Lee (), Jae Young Choi () and Youngsang Cho
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Youngsang Cho: Technology Management, Economics, and Policy Program (TEMEP); Seoul National University

No 200933, TEMEP Discussion Papers from Seoul National University; Technology Management, Economics, and Policy Program (TEMEP)

Abstract: Just as standards wars over formats had characterized VCRs upon introduction to the market, the next-generation DVD standards war between Blu-Ray and HD-DVD lasted six years before Blu-Ray won the contest. Beginning with stated preference data drawn from a structured conjoint survey conducted before Blu-Ray became the de facto standard of the next-generation DVD format, we estimated consumer preferences on digital video players. A Bayesian mixed-logit model was used and market share simulations were conducted under various scenarios based on estimated parameters to surmise the future South Korean digital video-player market. Results indicate that consumers feel that network size and title availability are more important than hardware-related facets of the product, such as definition and storage capacity. The level of title availability and price of the Blu-Ray player for Blu-Ray¡¯s dominance over DVD will vary by the penetration rate of DVD players.

Keywords: Next-generation DVD; de facto standard; mixed logit; market share simulation; standard competition grade; willingness to pay; relative importance. (search for similar items in EconPapers)
JEL-codes: C11 C25 C63 L15 L82 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2009-11, Revised 2009-11
New Economics Papers: this item is included in nep-dcm and nep-mkt
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Persistent link: https://EconPapers.repec.org/RePEc:snv:dp2009:200933

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