What do you think about the acquisitions of FAO Schwarz and KB Toys by Toys-R-Us? Do you think those choices hindered or helped Toys-R-Us in its bid to regain market share from Wal-Mart? Vertical integration requires some market failure, such as demand risk or price gouging, and both definitely seemed to be an issue for Toys-R-Us in the early 2000s. But did these acquisitions meet the requirement of remedying those issues and making vertical integration a healthy choice for the business? With kids electronics being so prevalent in the 21st century, I wonder if Toys-R-Us stood a chance. If they had survived, do you think Toys-R-Us might have needed to have a separate division solely for kids' electronics, like learning tablets?

Also, as far as expanding internationally, how did Netflix engage in backward integration because it was less expensive to produce some of its own content instead of licensing?