Technical Compatibility 3 The excess Inertia and Excess Momentum cases apply to market settings where the network gains from compatibility and“ connectedness” are large both firms want to adopt a common technolo gy Difficulty in agreeing which technology both should use Sometimes firms will not have a preference to make their technology the common standard or not to have a common technology at all Different technologies loses compatibility But different technologies differentiates each product and softens price competition, e.g., Play Station 3 VS. Wil vS X-BoX13 Technical Compatibility 3 • The Excess Inertia and Excess Momentum cases apply to market settings where the network gains from compatibility and “connectedness” are large – both firms want to adopt a common technology – Difficulty in agreeing which technology both should use • Sometimes firms will not have a preference to make their technology the common standard or not to have a common technology at all – Different technologies loses compatibility – But different technologies differentiates each product and softens price competition, e.g., PlayStation 3 vs. Wii vs. X-Box