When two or more companies are competing with each other to get their technology adopted as a standard in an industry, and when network effects and positive feedback loops are important, the company that wins the format war will be the one whose strategy best exploits positive feedback loops.

Question

Quizplus · Accepted Answer

Positive feedback loops can create a self-reinforcing cycle that pushes a technology or format towards becoming a standard. The company that can best leverage these positive feedback loops through its strategy will be more likely to win the format war and establish its technology as the dominant standard in the industry.

When Two or More Companies Are Competing with Each Other