Showing posts with label swithcing costs. Show all posts
Showing posts with label swithcing costs. Show all posts

Wednesday, June 18, 2008

Econ 101: Network Externalities and Switching Costs - or - How I Learned to Stop Worrying and Love the Mac

It all began with an Apple IIe upon which I programed a stupid animation of a duck kicking an egg. Then, in college, my brand new typewriter was immediately mothballed once I was shown the Mac labs in the basement of the dorms. Soon I owned one, then a PowerBook and finally a PowerMac that I bought upon starting my PhD. But it was soon over as economics was entirely PC and switching platforms got to become too burdensome. I was consumed by the evil Microsoft empire and have been a slave to PC ever since even after Macs got better and platform switching become a snap.

Economists call the two things that kept me enslaved network externalities and switching costs. Network externalities are when the value you get from using a product goes up the more that other people use it (and vice versa). So, since I was in economics and everyone used PCs, the value I got from PC usage went up and Mac usage went down. Thus I went to PC. Switching costs are just that, the costs you incur when you switch from one product to another. In my case, some software adjustments will have to be made and, more importantly, I have to retrain myself to do some things that I now do without thinking.

So what happened? Well with increased ease of moving across platforms and with the increased popularity of the Mac (including some of my colleagues) the network externality angle has lessened a lot. Switching costs have diminished as well thanks to USB ports, flash drives and Macs ability to link with Mac or PC networks (like I have at home).

And so it is that I have finally come back home to Mac. I am as giddy as the day I brought my first Mac home (a Mac SE - the IIe was a childhood friend's). Here is a picture of the beautiful little guy. A computer on which I wrote my first e-mail. Ah nostalgia. Anyway, I am now fully committed to making the complete transition over time and you know what? It feels fantastic!

So this, my dear readers, is the first blog post from the new MacBook Pro. Enjoy.

UPDATE: I do have one disappointment: in the old days when I used to start up my Mac, it would smile at me. It doesn't do that anymore...