Question
For the past several years, a consortium of Japanese television manufacturers, led by Sony, has been working to develop a common standard for the next-generation
For the past several years, a consortium of Japanese television manufacturers, led by Sony, has been working to develop a common standard for the next-generation 8k TV broadcast signals. A consortium of South Korean manufacturers led by Samsung has been developing a different standard for the same purpose. With 8k expected to reach critical levels of product penetration within the next year or two, both groups must decide which standard they will implement in their next-generation TV sets. For simplicity, let's call the Japanese standard A, and the Korean standard B. Each consortium must choose which technology to adopt, as type A sets cannot receive type B signals, and vice versa. Suppose the payoff to each consortium from adopting each standard is given in the game table below, where the payoffs are in billions of dollars per year.
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