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Information Rules Hardcover – December 4, 1998

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Product Details

  • Hardcover
  • Publisher: Harvard Business Review Press (December 4, 1998)
  • ASIN: B001EJHAPE
  • Product Dimensions: 9.1 x 6.6 x 1.1 inches
  • Shipping Weight: 1.6 pounds
  • Average Customer Review: 4.3 out of 5 stars  See all reviews (77 customer reviews)
  • Amazon Best Sellers Rank: #5,923,150 in Books (See Top 100 in Books)

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102 of 113 people found the following review helpful By hypermark on December 21, 1998
Format: Hardcover
Information Rules: A Strategic Guide to the Network Economy by Carl Shapiro and Hal Varian takes a look at the emerging Internet economy, and argues compellingly that traditional economics still apply in evaluating the Yahoos of our generation. In fact, history provides a pretty good guide for evaluating network-centric businesses. One only has to look at the evolution of the railroad, telephone and television networks. The book reaches some interesting conclusions, summarized here:
1.Information is costly to produce but inexpensive to reproduce (i.e., has a high fixed cost but a low marginal cost). This translates to a lot of latitude, challenges and opportunities in coming up with pricing models and corresponding versions of a product to create both the maximum revenue opportunities and establish the largest number of members of the product's network of users. Also, given the low cost of reproduction, it stands to reason that protecting intellectual property is a key determinant of information good's economic success. 2.Information is an "Experience Good," which is to say that customers must use and experience the product to put value on it. One only has to think about Netscape's initial success giving away the browser to see the value of leveraging the "experience" factor. 3.Products that can achieve "lock-in" will benefit from the "switching costs" that preclude customers from switching-over to competing (even superior) solutions. In other words, products that get a user to commit time, knowledge and/or resources to them are likely to continue to be used even in the face of superior products given the cost of switching to alternative products.
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20 of 21 people found the following review helpful By Y. Zhu on April 29, 2002
Format: Hardcover
"Information Rules" is a hand book for economic layman to understand emerging Internet economy, to help reader to apply feasible strategies into network business. As author mentioned in the beginning of this book, this book is seeking models, concepts, and analysis, which will provide reader with a deeper understanding of the fundamental principles in today's high-tech industries, and enable reader to craft winning strategies for tomorrow's network economy.
Technology changes, economic laws do not. This is the thesis of this book. Shapiro & Varian do a great job of explaining how the fundamental principles of economics are still relevant, even in the new network economy. On the other hand, the technology increases the pace of economic game and requires greater speed and agility to keep playing. Thus, it's necessary to adopt new strategies based on fundamental economic principles.
Shapiro & Varian develop this thesis into ten chapters: The Information Economy, Pricing Information, Versioning Information, Rights Management, Recognizing Lock-In, Managing Lock-In, Networks and Positive Feedback, Cooperation and Compatibility, Waging a Standards War, and Information Policy. Specific strategies are suggested in each chapter. At the end of each chapter, "lessons" are summarized to for readers to outline the main ideas efficiently.
Following are some feature points and strategies this book has reached to enable myself to the network economy.
Point 1: Information is costly to produce but inexpensive to reproduce.
The competition between Britannica Encyclopedia and Microsoft's Funk & Wagnalls brings reader into this topic.
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21 of 24 people found the following review helpful By A. Tiwana on March 8, 2000
Format: Hardcover
I used this book in an undergraduate business school course and all forty-five of us (me and my students) LOVED it. This book is one of those business classics that comes along once every five years. Unlike hyped marketers with ideas but no evidence, this book is grounded in solid research. If you read this one, make sure you also read the authors' article in the November 1998 Harvard Business Review. The book is highly original, fresh, and very very readable. In conclusion, this book is worth *every* penny.
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9 of 9 people found the following review helpful By B.Sudhakar Shenoy on August 14, 2000
Format: Hardcover
There is a lot of confusion these days in terms of trying to define the rules of success in the new economy. One thing for sure is that the pace of change we are experiencing today is unprecedented and can be ignored at our own peril. But amazingly, the rules of the game have not changed - as argued so powerfully in this book; the pace of the game has increased and it requires greater speed and agility to keep playing.
But if the rules are the same and the pace has increased what about the playing field? Well, it is turning bigger and a player who wants to be in the game should know every inch of it.
The main theme of the book centers on the concept that while we may adopt new strategies in the information economy the fundamental economic principles still apply. The goods that we are dealing with are information goods that are costly to produce and cheap to reproduce. In such a scenario, what are the cost characteristics, pricing strategies and market structures? Similarly the concepts of Versioning, Rights management, Lock-in, Networks & positive feedback are analyzed in great detail with appropriate illustrations and cases.
Highly recommended.
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