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Selected Case

published: 02 Jan 2005

  • Topic: Strategy
  • Industry: Computer Peripheral Equipment
  • Region: North America

Abstract:
The case describes the situation in the desktop printer industry in August 2002. Rumours suggest that Dell is planning to enter the industry. The case describes the structure of the industry, the main players, and the events leading to these rumours. Some possibles motives for Dell entering the printer industry are discussed, as well as the entry barriers.

Pedagogical Objectives:
The case is designed to examine whether a firm with a dominant position in an industry (Dell in PCs) can exploit its powerful position to enter into complementary products (desktop printers). The dominant incumbent in printers (HP) already competes with Dell in PCs. The entry barriers in the printer business are large. The main question is whether Dell can overcome the barriers in order to benefit from this profitable business, or deflate a profit pool from its rival.

Keywords:
Market Entry, Desktop Printers, Entry Barriers, Competitive Dynamics, Tapered Integration, Complementary Products, Multimarket Competition, Diversification


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