Essay About Will Bury And Market Structure

Business Proposal for Will Bury and Digital Books
Business Proposal for Will Bury and Digital BooksECO/561Business Proposal for Will Bury and Digital BooksWill Bury, an inventor, has created a technology to convert printed text to a realistic voice that will read the text at a reasonable price.  Current books on CD are expensive with a real voice.  Other technology exists, but it uses computerized voices.  Bury’s technology would join the two worlds together by using technology to recognize print and read to listeners using a more human-like voice.  This business proposal will discuss market structure, product elasticity, price structure, product differentiation and nonprice barriers.       Market StructureThere are several different options for consumers when choosing an audible book.  Each of these options are vastly different from one another by using either a real person or by using technology to read the text.  Filling a Gap in the Market StructureIf  Bury’s digitized book program is more advanced than the competitors offering a product that has no close substitute, the market structure could be considered a monopoly.  The closer an industry’s market structure gets to a monopoly, more profits the industry can achieve.  A monopoly is defined as “a single firm is the sole producer of a product for which there are no close substitutes” (McConnell, Brue, & Flynn, 2009, p. 202).  The monopolistic firm controls the supply of digitized books and sets the price for each digitized book.  Books on CD are costly and the number of books on CD are limited leaving a gap in the market.  The other competitor offers digitized books with a synthetic voice.  However, consumers are looking for a more realistic voice.  Bury’s digitized books can fill the gap in the market because his program can digitize more recent releases at a fraction of the price and resemble a more human voice.  Bury’s Digitized Books Market StructureThe market structure for digitized books “involves only a few sellers of a … differentiated product” (McConnell, Brue, & Flynn, 2009, p. 177), thus making the market structure an oligopoly.   Given that there are only three firms in the market with similar, but differentiated products, the market for Bury’s digitized books is an oligopoly.  Competition is fierce in an oligopoly and trends are usually based on competitors.  Bury’s digitized books will be new to the market so his products market share will be low initially.  Since his product could revolutionize the differentiated oligopoly market, his product could gain a majority market share.  However, with technological advancements and patent expirations, the market structure could changes quickly to monopolistic competition or pure competition as the number of competitors increases.