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Newsletter e-business Center PwC&IESE
ICT Impact Analysis on Organizations and Their Surrounding Environment 

http://www.ebcenter.org
16-30th June, 2005
ZOOMING IN
Apple Switches to Intel
Commentary by Sandra Sieber, IESE professor
REPORTS
Two Different Consumers, Two Different Prices
TREND HUNTER
The Succulent Market of Digital Printing
Audio Books Speak Up
Asia Continues its Conquest of the West
EBCENTER KNOWLEDGE
ICT has Reduced Production Costs of 64% of Spanish Companies
Advice on How to Succeed in Relationship Marketing
 
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ZOOMING IN
Apple Switches to Intel
Steve Jobs, Executive Director at Apple, has just announced that Mac computers will stop using IBM’s PowerPC processors and will start shipping the Macs with Intel chips. For Jobs, Intel has by far the most powerful chips on the market.
The first Apples equipped with Intel processors are expected for the summer of 2006 and it is foreseen to have the “Intel inside” logo on the whole line of Apple products by the end of 2007.
This agreement could be the start of other deals between Apple and Intel with a view to developing devices targeting the home and office, or quite possibly for the Internet video downloading market.
Commentary by Sandra Sieber, IESE professor

What has changed? This is the how Steve Ballmer, CEO of Microsoft, questioned whether Apple’s decision to include Intel chips in its systems is going to modify the market situation of the software behemoth and the company in Cupertino. However, this news –surprising for some in spite of the insistent rumors in recent months– does indeed entail some changes.

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REPORTS
Two Different Consumers, Two Different Prices

Title: Open to Exploitation: American Shoppers Online and Offline
Source: Joseph Turow, Lauren Feldman, and Kimberly Meltzer. Annenberg Public Policy Center of the University of Pennsylvania.
Date: June 2005
Abstract: Almost two thirds (64%) of the adults who shop on the Internet erroneously believe that price discrimination is improper and illegal, according to a report recently drawn up by the Annenberg Public Policy Center of the University of Pennsylvania (USA). According to the authors of the report, which was based on phone interviews with 1,500 adults, the naivety of consumers puts them at the mercy of salespeople. The latter not only charge different customers different prices for the same product by taking advantage of the information that the shopper gives them, but they do so regularly because it is legal (this also happens in traditional establishments, something that 71% of those interviewed did not know).
Another fact that reflects the innocence of consumers is that 75% of them believe that the mere existence of a private policy on a web page implies that the data of customers will not be shared with third parties. This is just pure fallacy. Generally speaking the small print usually specifies exactly how the company plans to use the information gathered.
The report proposes three recommendations to eliminate the vulnerability of surfers against the marketing voracity of some enterprises: 1) substitute the label “private policy” for “use of information”; 2) teach the consumer to protect himself against marketing abuse from the school stage; 3) urge the government to take measures to demand that enterprises divulge what information they gather on their customers and how they use it.   

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TREND HUNTER
The Succulent Market of Digital Printing

Nowadays, even the staunchest analogue camera user has succumbed to the charms of the digital camera: this device has already made a place for itself in one out of five homes in Spain. Far from dying off, the phenomenon continues, and it does so by killing off any photographic company that has not managed to adapt to the change. Agfa is such a case and has just filed for Chapter 11 protection.
The good news is that the digital boost has led to a whole new world of accessories and services, like digital photograph printing. This market has moved some 8,200 million dollars, according to the Photo Marketing Association International, which has set off a price war among the different suppliers, especially the web-based printing digital services like Snapfish or Shutterfly.
All the traditional establishments and domestic printer makers have got their act together: the former by setting up electronic kiosks for digital printing and the latter by reducing the costs of printing at home (much more expensive than getting it done outside, except for large format photos).
Now the mobile telephone operators are getting into the act. Amena and Vodafone have just launched their respective online printing services for photos made by mobile terminals. With all of this, the sector experts say that only one in five digital photos actually gets into the paper format.

Articles in The New York Times (Free Registry Required), Washington Post and BusinessWeek
News in ZDnet

Audio Books Speak Up

Can you imagine Bill Clinton’s biography narrated by Bill himself? Well, it is possible thanks to audio books. Sound and digitalized versions of published content can be downloaded directly from the Internet to any device with audio player functions including iPods, Palms, pocket computers and some mobile telephone models.
Apart from the book called “My Life”, which is the name of the biography of the former president of the United States, the webpage of Audible Inc., offers the possibility of choosing from among more than 23,000 sound files comprising books, radio programs, newspapers and magazines. In spite of the fact that Audible is a modest-sized company, it can boast of leading the market in audio-book downloads and has some very big fry, like Microsoft, Bertlesmann and Amazon, as partners.
Now, however, Amazon has just announced that it is developing an online store to sell downloadable audio books. In fact, for the last few days a note in the web page of e-books & Documents has been inviting book publishers and other audio content publishers to participate in the initiative.
This has put Audible in a somewhat uncomfortable position, which as a result of the news saw its share price fall 13% on the Nasdaq. Amazon’s move is an invitation to think of a business model with growth prospects over the coming months. The fact is that unlike e-books, that have never caught on among Internet surfers, at least not as a lucrative business, audio-books fit in very well with two other fashionable phenomena: the proliferation of MP3 players and the syndication of audio content or podcasting.

News in Reuters
Article in BusinessWeek

Asia Continues its Conquest of the West

This time, it is the turn of BenQ, the Taiwanese company. The maker of all sorts of electronic devices –from computers to flat screens to mobile phones- has recently announced the acquisition of the Siemens mobile telephony subsidiary. The German consortium has decided to get rid of the dead weight that the mobile phone business has meant for them. In the first half of this year losses came to 280 million euros.
Under the terms of the agreement Siemens must pay BenQ 250 million euros as well as buy a stake in BenQ to the tune of 50 million euros. Moreover, the agreement foresees that the terminals of both makers coexist on the market for some months and that BenQ can use the Siemens trade mark to sell its phones over the next five years.
BenQ’s main source of revenue is from computer flat-screens and it foresees sales of 100 million euros in Spain for 2005. In addition to mobile telephones, which they expect to start selling after the summer, the company will also sell television flat-screens.

News in BusinessWeek and News.com

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EBCENTER KNOWLEDGE
ICT has Reduced Production Costs of 64% of Spanish Companies

The introduction of information and communication technologies (ICT) has meant a reduction in production costs in 64% of Spanish companies, while 55% of companies state that they reduced internal communications costs. Costs have also decreased in Human Resources in 42% of organizations. These are the main highlights of the report "Las TIC como agente de cambio en la empresa española. Situación actual y tendencias de futuro", which was released by the e-business Center PwC&IESE at the Internet Global Congress on 7th of June.

Full Story (PDF, 710 Kb)

Advice on How to Succeed in Relationship Marketing
By Lluís Renart, IESE professor, and Carles Cabré, e-business Center PwC&IESE collaborator
The experience of recent years shows that CRM strategies are gradual processes where one has to check how customers react in each project. 

Full Story (PDF, 17 Kb)


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