The Business Model of Game Console-The Value Creation of System Manufacturers and IC Design Houses In Taiwan

• Main Authors: Chung, Yuan Shui, 鍾元水
• Other Authors: Professor Po-Young Chu
• Format: Others
• Language: zh-TW
• Published: 2003
• Online Access: http://ndltd.ncl.edu.tw/handle/58010894667693716942

碩士 === 國立交通大學 === 高階主管管理學程碩士班 === 91 === The Game Console Industry has more than twenty years history. The current two major game console leaders, SONY and Nintendo, used to have virtical integration supply chain. Starting from upstream IC and mechanical components down to the console assembly, everything was used to be built in-house. Using game software to subsidize console hardware in order to grab major software market share is the characteristics of game console busienss. Therefore, the sales volume of game console is the key success indicator of game software business. Microsoft is a new comer in the game business, and has successfully applied a dis-integration supply chain model to market its XBOX™ game console. It results in lower cost and faster new game console development, and succesfuly gains significant market share in game business. It has forced Sony and Nintendo to change their original vertical integration business model to semi-vertical dis-integration, by outsourcing some of their componets, modules and even the whole set of the game console. Taiwan companies are leaders in PC hardware industry and built up a very strong supply chain infrastructure. These advantages facilitate Taiwan companies into game console manufacturing and design busienss. Taiwan suppliers will play a more important role than before, and will act as strategic business partners to the worldwide branded game console players such as Sony, Microsoft and Nintendo. From the perspectives of the technology innovation and infrastructure development of Game Console industry, the thesis explores and analysizes the following topics: (1) how game console manufacturing business changing from vertical integration to virtual integration, (2) decision making process of outsourcing game console compoents and modules, (3) future value creation and strategies of Taiwanese system manufacturers and IC design companies.