by A long but interesting read:
Beating Bill
<http://www.business2.com/articles/mag/0,1640,40438|1,FF.html>
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Keep changing the game.
Rob Glaser, CEO of RealNetworks, knows a lot about Microsoft's ways; he
was a star executive there for 10 years before founding Real. His own
cardinal rule for going against Microsoft: Never play its game. The
RealOne Player, which handles Internet video and music, competes with
Microsoft's Windows Media Player. Embarrassingly for Microsoft, the Real
player has held its own, even though Media Player ships with Windows.
Glaser has matched Microsoft technologically. But his real edge has come
from adroit shifts of strategy in response to Microsoft's moves. "If you
want to beat Bobby Fischer, don't play chess," he says.
That explains why Glaser has run through five business models in eight
years, from charging for premium software to selling ads to adding
subscription services. It might also explain why he's finally making
money: Real earned $1 million on sales of $47 million in its latest
quarter. Most recently Glaser's RealOne service began selling
subscriptions to streaming content from ABC News, Major League Baseball,
Nascar, and MusicNet, a digital music service. Today, 600,000 RealOne
users pay up to $20 a month for access to Real's array of content. Glaser
hopes to create network effects that will feed on themselves, like eBay's
model. "When you unleash network effects, you can build very durable
businesses," he notes. The more subscribers he attracts, the easier it
will be to lock in more content providers, which in turn should attract
more subscribers.
Of course, Microsoft could easily offer similar services through MSN. But
Glaser thinks he can prevail by finding yet another new route to success.
"We just keep driving forward and looking in the rearview mirror every
once in a while," he says. "And we don't take our foot off the
accelerator."
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