What are some of the exit barriers to the video game console industry?
Thursday, September 24th, 2009 at
3:22 pm
yoursolastsummer asked:
What are some of the potential barriers to exit in the video game console industry (or the Electronic Gaming Products Industry). Any sources to back up cheap prescription drugs without prescription your answers would be appreciated.
What are some of the potential barriers to exit in the video game console industry (or the Electronic Gaming Products Industry). Any sources to back up cheap prescription drugs without prescription your answers would be appreciated.
There are none. It’s not like you’re shutting down a coal mine and need to restore the environment around it.
3 large game console companies could easily re-tool their plants to make other kinds of electronic goods (computers, DVD players, etc.).
Of course, there will be money lost in advertising and game development, but that’s sunk cost.
So the only barrier would be fans whining. But a decent security force should take care of that.
Independent video game companies such as EA Sports license the console platforms and pay royalties to the console makers such as Sony and Nintendo.
Part of the licensing deals may require the console maker to continue to produce the console and support it for a certain number of years. Failure to due this may result in penalties on the console maker. Therefore, this penalty serves as a barrier to exit.