Reduce Price to Improve Revenues and Margins

CHOICE 1 OBJECTIVE: ATTRACT CUSTOMERS

CHOICE 2 SEGMENTS: LOSS LEADER SEGMENT / A LOW PRICE ON ONE PRODUCT TO OBTAIN REVENUES FROM ANOTHER PRODUCT IN A MANUFACTURING SERVICE BUSINESS

CHOICE 3 COMPONENT: PROVIDE A FREE OR HEAVILY DISCOUNTED PRODUCT FROM A THIRD PARTY

No.	SIC	Year	Notes
1	4841	2004	By signing people up with Freesat, a service that offers television channels for free with the proper satellite equipment, BSkyB isn't just selling them satellite dishes but it gains extensive customer contact information and every opportunity to market additional products. People who sign up with Freesat will likely be bombarded with advertisements to upgrade to the company's paid services.
2	4841	2004	Satellite companies are snaring more subscribers, but are paying for their growth. Satellite is stealing growth from cable due to price and added features. With cable's rate hikes, satellite companies are easily selling their services for about $10 a month cheaper than their cable rivals. Also, DirectTV and EchoStar are bringing in customers with offers like free set-top boxes, inexpensive TiVo-like digital recorders, and three months of free service.
3	4841	2004	TiVo's overall DVR share is about a third of the market and shrinking as the market has been flooded by cheaper, more efficiently distributed products, including a set-top cable box by Scientific-Atlantic. Often, cable companies like Time Warner Cable are distributing the boxes to customers free in return for a monthly service charge that ranges from $5 to $9. Buying a TiVo at retail costs a minimum of $199 with a $13 a monthly programming fee.
4	4899	2000	The Bells and cable-TV companies are fighting to sign-up Internet customers. Many have cut prices and waived installation fees. A number of companies offer almost free PCs in exchange for a sign-up. Customers who sign up for a new SBC deal will receive a new Compaq Presario PC, worth $1,000.
5	7372	2003	Linux, the free operating system software burst on the scene in the late 1990s. Thousands of developers worked Linux code as companies like IBM began servicing Linux-based systems. Shift in system is apparent in Wall Street where "big boys" like Merrill Lynch are switching from Unix to Linux in droves. Linux servers have a 7% market share, up from 0.5% two years ago.

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