Product Competition Strategy Based On Network Effect

Since 1990s, the quick development of Information and Communication Technology (ICT) and Internet has taken us into Internet economy era, and the emergency of network effect which makes enterprise's competition more drastic, becomes a new issue for us under new economical condition.The specific can be described as follows:1. By describing the status of network effect theories and analyzing the domestic and overseas research status of related theories, this paper proposed the angle of view based on industry economic theory and enterprise's competition, and applied system theory to intercept the market phenomena caused by network effect.2. This paper deeply expatiated related theories about network effect. These theories included basic concepts and economic theory of network effect, characteristics of network products and network market, and compared the difference between network products and traditional ones, which made basis for following discussions of competition strategies of products with network effect.3. According to related theories of network effect and competition characteristics of network products and network markets, this paper proposed competition strategies of products under network effect, providing suggestions for managers' decision-making under new economic status. This paper also discussed standard competition, which was the top form of enterprise's competition, showing the significance of standard for enterprise's competition under network condition.The innovation points in this paper included: CAS theories were used to analyze the important meanings of network-effect products in the market equilibrium and planned obsolescence and product predict strategies were proposed.