The Impact of New Companies Entering the Market

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Market Trends Impact
Eleni Foreso, Pat Norton, Fabian Rangel and Heidi Hamlin
University of Phoenix
April 29, 2008
Market Trends Impact
            This paper will analyze the impact of market trends on the computer industry and the organization Dell, Inc.  The market trends will be identified within the following areas; market structure, prices, technology, production, cost structure, competitors, regulatory, supply and demand.  The paper will also discuss the impact of new companies entering the market. Market Structure and Pricing

            This part of the paper will cover market structure, the impact of new companies entering the market, prices, and how each of the following will or will not change, and why.    According to this week’s readings, market structure refers to “the physical characteristics of the market within which firms interact” (Colander, 2004).  The four types of market structures are: a perfect competition, monopoly, monopolistic competition, and oligopoly. In looking at the four different types of market structures, Dell, Inc.’s company characteristics fit into the monopolistic competition. The characteristics of a monopolistic competition are that many firms exist, few barriers to entry, and pricing decisions are based on market costs equals market revenue.  The output is somewhat restricted by product differentiation, each firm acts independently, and no long-run economic profit exist. Dell, Inc. will not change from being a monopolistic competition, because of being involved in the computer industry, and because the computer industry is constantly changing and growing larger every day, by becoming more of a global market.             The impact of new companies entering the computer industry/market has been major growth, successful localization, and entering the multimedia era on a larger scale. Growth has included mass amounts of new games, hardware, software, devices, operating systems and computer components coming into existence. The impact of new companies entering the market has also been an increase in competition, and consumers having the advantage to shop comparatively. The computer industry has grown to be a worldwide industry. Successful localization has enabled the computer industry to design, produce and mass-market their various products, goods, services and systems to consumers all over the world. The multimedia area covers CD-Rom packages, DOS/V, computers with television capability and still-frame videos. The impact of new companies entering the market will always be changing, because the computer industry is constantly changing. Advancements are being made in all areas of this technology on a daily basis.             Dells’ pricing ensures the company’s niche in the market, regardless of new companies trying to enter the market. Dell’s prices range from $35 for an Axiom 512, MB DIMM Memory Module for Select Dell Dimension/Optiplex Desktop, to $2199 for a Dell XPS One Desktop Computer. Their pricing also depends upon what item is purchased, in what state and in which store that item is purchased, and if their products and services are purchased in the store or online through the Internet. The computer industry’s pricing policies also include if the product or service is brand-new, used or rebuilt. Pricing will always be changing worldwide, as economies change, and the price of living increases or decreases, and new technology and advances are made and improved. Technology Trends

            In the computer industry technology is the most important trend.  The globe is becoming more technological every year.  The growth of technology impacts the global economy.  As developing countries find access to technological devices, they add to the consumer markets and are becoming more involved in the global economy.  One example of this is the organization One Laptop per Child.  The mission of the organization is to give one computer laptop to all children of...
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