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Submitted by matthew5299 on November 12, 2007
Category: Business
Words: 1781 | Pages: 8
Views: 174
Popularity Rank: 57,836
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Executive Summary
There are two main key issues when dealing with Apple's digital music player market. The first issue consists of Apple maintaining its digital music player market share. The second issue pertains to whether or not Apple has a niche music player by not licensing its technology. Apple has a substantial market share consisting of 60% of the digital music player market when only 11% of the U.S. population owns digital devices. In order for Apple to maintain its major role in the digital player market it must consistently maintain its innovativeness over other digital music players in the industry. Apple not licensing their technology and creating a niche music player could hurt them in a market where consumers may want to use their device to its full potential.
Analysis
When analyzing the Apple industry on of the main tools that was used was the five forces analysis. The first force looked at was the barrier to entry, in which capital, brand loyalty and economies of scale were the main components. In an industry where technology plays such a major role capital is a must in order to stay innovative and ahead of the competition in the research and development department. Capital is also needed because there are so many major names in the music player industry already that a major advertising campaign as well as some type of niche in the market to set you apart would be needed. When it comes to brand loyalty, companies like Apple, Dell, Creative Labs, iRiver, RCA and SanDisk already play a major role by producing music players that are reliable and cost efficient depending on the technology that you are looking for in a music player. Economies of scale would play a major role in deciding whether or not to enter the music player market because Apple controls 60 percent of the music player market in which only 11 percent of the population owns a player. This would make one believe that since Apple owns such a major...
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