Competitors create a market for complementary products Hardware and software. Microwave ovens and popcorn. Cameras and films. One-family houses, car sales and lawnmowers. The world is full of examples of complementarity. Many successful business concepts are born on the basis of an analysis of innovations, new product categories, market growth, etc. leading to an identification of complementary markets.

Strictly speaking, complementarity is the opposite of competition. The sales and fleet of DVD-players stimulate the sale of DVDs not the other way around. The thrust and strength of competition has, however, had a decisive impact on the characteristics of derived, complementary markets - including the question of whether new enterprises, in particular, have special opportunities. Easybrick Competition in the market for mobile phones and electronic organisers was very much a question of offering consumers more and new fields of application - polyphonic sound, logos, text messages, camera function, video, data services. The new functionalities require higher processing power and more memory, but also better batteries and more frequent recharging. The market for chargers is complementary to the terminal market. The innovation pace in the charger market has been lagging behind, as it were, the development of terminals and has so far been seen as a relatively inferior commodity without importance to the consumer in making his or her choice. One consequence has been that the biggest suppliers of chargers, who have shared the market between them, have focused exclusively on unit costs and price, whereas dimensions such as design, weight, electricity consumption during stand-by have largely remained at the same level over several generations of terminals. The start-up enterprise Easybrick took advantage of this and developed the product platform Tiny Plug, which does not focus on price exclusively but also on an expectation that gradually consumers will be willing to pay a little more for design, compactness, and reduced leakage during stand-by. Standards as midwives for new ventures Absence of a standard may block market development. The classic example of this is the competition between VHS and Beta format in the video cassette market. As long as they were stubbornly fighting each other, the content suppliers and the producers of hardware avoided investing in the market because of their expectation that consumers would hold back until one and only one standard had been de facto accepted. Promising emerging markets and technologies usually attract a lot of entrepreneurial initiative. Whether and when a market will begin to grow will, however, entirely depend on the existence of a consensus for a standard. In some cases, de facto standards are created as the result of a murderous elimination race in which one suppUer will end up as the standard - Microsoft and Windows. The fact that a single operative system now sets the standard has, to be sure, led to the eradication of Microsoft's direct competitors, but does, on the other hand, essentially explain the quick growth of the computer market. The alternative would have been a fragmentation of the software market, far higher prices and slower penetration. In short: poor conditions for slipstream innovation. Virgin markets without standards make the customers hold back. We see more and more examples of leading suppliers - competitors - agreeing on a common standard rather than launching their own proprietary solutions and starting a war only one of them, if any, can win. As a consequence they avoid fatiguing, resource intensive mutual competition while at the same time ensuring quicker and cheaper stimulation of demand. An advantage will not only accrue to those suppliers who agree about the protocol or the format. Establishment of a standard also means that the way is opened for everybody else who will probably position themselves elsewhere in the value chain. Such a development is very typical in the field of software and telecommunication with known standards such as GSM, Blue Tooth, Web Services, HTML and WAP.

Question 1:

Please read the whole text and briefly explain its concept in few lines in your language, tell what is it about, and write the summarization of each title separately?