- 26 Nov 2012
- Research & Ideas
New Winners and Losers in the Internet Economy
In a stressed US economy, employment in the Internet ecosystem is growing at an impressive rate, with small companies especially benefiting, according to a new study by Professor John A. Deighton and research associate Leora D. Kornfeld. Open for comment; 0 Comments.
- 26 Apr 2012
- Working Paper Summaries
What Makes a Critic Tick? Connected Authors and the Determinants of Book Reviews
The professional critic has long been heralded as the gold standard for evaluating products and services such as books, movies, and restaurants. Analyzing hundreds of book reviews from 40 different newspapers and magazines, Professor Michael Luca and coauthors Loretti Dobrescu and Alberto Motta investigate the determinants of professional reviews and then compare these to consumer reviews from Amazon.com. Key concepts include: The data suggest that media outlets do not simply seek to isolate high-quality books, but also to find books that are a good fit for their readers. This is a potential advantage for professional critics, one that cannot be easily replicated by consumer reviews. Expert ratings are correlated with Amazon ratings, suggesting that experts and consumers tend to agree in aggregate about the quality of a book. However, there are systematic differences between these sets of reviews. Relative to consumer reviews, professional critics are less favorable to first-time authors. This suggests that one potential advantage of consumer reviews is that they are quicker to identify new and unknown books. Relative to consumer reviews, professional critics are more favorable to authors who have garnered other attention in the press (as measured by number of media mentions outside of the review) and who have won book prizes. Closed for comment; 0 Comments.
- 06 Jan 2012
- Op-Ed
Where Green Corporate Ratings Fail
Many companies receiving high marks in environmental sustainability are hurting the planet in other ways, write professor Michael Toffel and executive Auden Schendler. Here's where green rankings fall short. Open for comment; 0 Comments.
- 03 Nov 2011
- Working Paper Summaries
Pricing and Efficiency in the Market for IP Addresses
Every device connected to the Internet—from PCs to tablets, printers to cash registers—needs an IP address. The current addressing standard, IPv4, uses addresses with 32 binary digits, allowing approximately 4 billion IP addresses. The world's centralized supply of unused IP addresses reached exhaustion in February 2011, and networks in most countries will soon find they cannot easily obtain additional IPv4 addresses. While addresses may now be bought and sold, the institutions and rules of these transfers are not yet well-developed. Nor have economic models examined the unusual characteristics of this market. Benjamin Edelman and Michael Schwarz model the market for IPv4 addresses, including evaluating novel rules intended to avoid possible harms from the purchase and sale of IP addresses, as well as predicting price trends. Key concepts include: Facing limited availability of IPv4 addresses, growing or newly created networks have several options. Many growing networks will, in the short run, turn to IPv4 purchases to meet their v4 needs—prompting questions of the design of markets and institutions to facilitate such transfers. While trade in IPv4 addresses promises various benefits, transfers also prompt concerns. Most common is the fear that certain address transfers might threaten the Internet's routing system—the systems that transfer data from one network to another. Suitable market rules can moderate these concerns. Closed for comment; 0 Comments.
- 27 Sep 2011
- Working Paper Summaries
Salience in Quality Disclosure: Evidence from the U.S. News College Rankings
Why are the U.S. News and World Report College Rankings so influential? According to this paper by Michael Luca and Jonathan Smith, it's at least in part because U.S. News makes the information so simple. While earlier college guides had already provided useful information about schools, U.S. News did the work of aggregating the information into an easy-to-use ranking, making it more salient for prospective students. The authors show that these rankings matter in a big way: a one-rank improvement leads to a 0.9 percent increase in applicants. However, students tend to ignore the underlying details even though these details carry more information than the overall rank. Key concepts include: College applicants pay attention to a school's overall rank, rather than the more informative (but more complicated) underlying information. When U.S. News and World Report chooses how much weight to apply to different categories (such as faculty/student ratio and alumni giving rate), they are exerting a large amount of influence over students' application decisions. U.S. News presents many of these details, but it's the bottom line (i.e., the weights chosen by U.S. News) that matters. When deciding how to present information, managers should keep in mind that simple metrics are most effective. Providing detailed information to consumers may seem useful, but aggregate statistics (such as a ranking or grade) tend to have a larger impact on decision making. Closed for comment; 0 Comments.
- 19 Jul 2011
- Research & Ideas
Rupert Murdoch and the Seeds of Moral Hazard
Harvard Business School faculty Michel Anteby, Rosabeth Moss Kanter, and Robert Steven Kaplan explore the moral, ethical, and leadership issues behind Rupert Murdoch's News of the World fiasco. Open for comment; 0 Comments.
- 04 Apr 2011
- HBS Case
Reinventing the National Geographic Society
How do you transform a 123-year-old cultural icon and prepare it for the digital world? Slowly, as a new case on the "National Geographic Society" by David Garvin demonstrates. Open for comment; 0 Comments.
- 20 Jan 2011
- Working Paper Summaries
Testing Coleman’s Social-Norm Enforcement Mechanism: Evidence from Wikipedia
Harvard Business School professor Mikolaj Jan Piskorski and doctoral candidate Andreea Gorbatai look to the editing process on Wikipedia to test and validate the well-accepted (but little-verified) theory of sociologist James Coleman that social norm violations decline as network density increases. Support for Coleman's mechanism would alert us to the importance of punishments for norm violations and rewards for such punishments, and thus help us to design social systems in which norms are observed. Key concepts include: Coleman argued that high-density networks provide an opportunity structure within which third parties can compensate norm enforcers for the expense of chastising norm violators. Such payments encourage actors to punish those who violate norms, which in turn reduce the incidence of norm violation. Despite ubiquitous citations of Coleman's explanation, little empirical work has tested it convincingly. The researchers identified the improper use of the revert command by Wikipedia contributors-by which users can quickly knock out text they don't agree with and revert it back to a prior state-as a norm violation. The research found substantial support for the theory, suggesting that increasing network density to elicit norm compliance is justified. On Wikipedia, norm violations, punishments for such violations, and rewards for those who punish violators are all highly visible. Replicating these conditions in the design of a social system is critical; otherwise, norm violations will remain undetected and therefore unpunished. Open for comment; 0 Comments.
- 05 Apr 2010
- Research & Ideas
HBS Cases: iPads, Kindles, and the Close of a Chapter in Book Publishing
Book publishing is changing before our very eyes, even if the industry itself is fighting the transition with every comma it can muster. Harvard Business School professor Peter Olson, former CEO of Random House, wonders if books themselves may be in jeopardy. Key concepts include: The traditional book publishing and distribution system is under pressure to change to digital e-books. Publishers should consider a strategy of cooperation rather than competition with online retailers. Adding video and other multimedia capabilities will make e-books more attractive in the textbook industry. The fundamental question to be asked in the Internet age is, how popular will books remain? Closed for comment; 0 Comments.
- 14 Sep 2009
- Research & Ideas
Understanding Users of Social Networks
Many business leaders are mystified about how to reach potential customers on social networks such as Facebook. Professor Mikolaj Jan Piskorski provides a fresh look into the interpersonal dynamics of these sites and offers guidance for approaching these tantalizing markets. Closed for comment; 0 Comments.
- 17 Aug 2009
- Research & Ideas
Quantifying the Economic Impact of the Internet
Businesses around the advertising-supported Internet have incredible multiplier effects throughout the economy and society. Professor John Quelch starts to put some numbers on the impact. Open for comment; 0 Comments.
- 27 Jul 2009
- Research & Ideas
Social Network Marketing: What Works?
Purchase decisions are influenced differently in social networks than in the brick-and-mortar world, says Harvard Business School professor Sunil Gupta. The key: Marketers should tap into the networking aspect of sites such as Facebook. Key concepts include: Some social network users are influenced by the purchases of their friends. Of these users, 40 percent show a strong "keeping up with the Joneses" behavior, increasing sales by 5 percent. "High-status" users are more likely to not purchase something that others have bought. On social networks, viral campaigns may work better than advertising. Closed for comment; 0 Comments.
- 03 Apr 2009
- What Do You Think?
How Much Obsolescence Can Business and Society Absorb?
This month's question brought out both the poets and the engineers among respondents. The rapid pace of new technology adoption within organizations implies change for management and society, says HBS professor Jim Heskett. How does change affect the open sharing of information? (Forum now closed; next forum begins May 1.) Closed for comment; 0 Comments.
- 12 Aug 2008
- Op-Ed
Google-Yahoo Ad Deal is Bad for Online Advertising
A proposed advertising deal between Internet competitors Google and Yahoo would reduce competitiveness in the Internet advertising market, likely resulting in higher advertising rates, says Harvard Business School professor Benjamin G. Edelman. Closed for comment; 0 Comments.
- 30 Apr 2008
- Sharpening Your Skills
Sharpening Your Skills: Brand Management
Should I trust my brand to a sports endorser? Does B2B branding work? What does mystery writer James Patterson know about branding that I don't? Here are some recent Working Knowledge articles on issues that keep brand managers up at night. Closed for comment; 0 Comments.
- 03 Dec 2007
- Research & Ideas
Authenticity over Exaggeration: The New Rule in Advertising
Advertisers thought technology was their friend in identifying and creating new customers. Funny thing happened along the way, though: Now consumers are using the Internet to blunt traditional commercial messages. Time for companies to rethink their strategy, says HBS professor John A. Deighton. Key concepts include: In today's media-rich world, traditional advertising models are breaking down. Now, the consumer runs the show. Successful advertising campaigns today are self-parodying and spark discussions rather than blatantly sell products. As digital interactivity increases the contexts in which people use new media, it becomes less and less productive to think of people as consumers alone. Closed for comment; 0 Comments.
- 17 Sep 2007
- Research & Ideas
Broadband: Remaking the Advertising Industry
Evolving from the Marlboro Man in the 1960s to the Subservient Chicken in a recent Web campaign, advertising is undergoing a radical transformation. Harvard Business School professor Stephen P. Bradley, who is cowriting a book on how broadband technologies are remaking many industries, discusses how advertising is responding to the challenges. Key concepts include: Traditional advertising vehicles such as television are becoming less interesting to advertisers because of fragmented viewership and inadequate user data. Broadband technology is becoming more important to advertisers because of its ability to move the consumer closer to a transaction decision and to deliver clearly segmented audiences. The advertising industry is wrestling with this transformation in part by merging with media companies and by launching creative ad alternatives. Closed for comment; 0 Comments.
- 23 Jul 2007
- Research & Ideas
HBS Cases: How Wikipedia Works (or Doesn’t)
For HBS professor Andrew McAfee, Wikipedia is a surprisingly high-quality product. But when his concept of "Enterprise 2.0" turned up on the online encyclopedia one day—and was recommended for deletion—McAfee and colleague Karim R. Lakhani knew they had the makings of an insightful case study on collaboration and governance in the digital world. Key concepts include: Despite thousands of participants, Wikipedia operates under a very ornate and well-defined structure of participation that enables them to produce a highly regarded online encyclopedia. A group of people in the Wikipedia world characterized as "exclusionists" could dampen user enthusiasm by increasing barriers to acceptance of Wikipedia articles. Knowledge-sharing technologies such as wikis are coming into increasing use in the corporate world, but companies must understand that a top-down approach to administering them will lead to certain extinction. Closed for comment; 0 Comments.
- 19 Jul 2007
- Research & Ideas
Podcast: Rupert Murdoch and the Wall Street Journal
Media baron Rupert Murdoch's bid to acquire Dow Jones and the Wall Street Journal is one step closer to fruition. In this interview, Professor Bharat N. Anand discusses the proposed deal and pressures facing the newspaper business. Closed for comment; 0 Comments.
Culture Changers: Managing High-Impact Entrepreneurs
In her new Harvard Business School course, Creative High-Impact Ventures: Entrepreneurs Who Changed the World, professor Mukti Khaire looks at ways managers can team with creative talent in six "culture industries": publishing, fashion, art-design, film, music, and food. Closed for comment; 0 Comments.