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Supplements the (A) case.

Founder and CEO Bill Warner is faced with critical decisions regarding the product lines, target markets, and technology platforms that his start-up, Wildfire Communications, Inc., will pursue. In addition to the question of strategic focus across these lines of business, Warner must decide whether changes in the organizational process will increase his company's effectiveness.

Every business today competes in two worlds; a physical world of resources that managers can see and touch and a virtual world made of information. Executives must pay attention to how their companies create value in both arenas--the marketplace and the marketspace. But the processes for accomplishing this are not the same in the two worlds. Managers who understand how to master both can create and extract value in the most efficient and effective manner. Creating value in any stage of a virtual value chain involves a sequence of five activities: gathering, organizing, selecting, synthesizing, and distributing information. Just as someone takes raw material and refines it into someting useful, so a manager today collects raw information and adds value through these five steps.

Examines the growth of the CD-ROM publishing industry and its impact on the Encyclopaedia Britannica Co., which chose to ignore it.

TV Guide, the nation's most profitable and largest magazine, attempts entry into the world of electronic publishing. The crux of TV Guide's strategy is to transform the magazine's content into a centralized database that can be accessed by new businesses, like on-screen programming guides for television, online service companies, and cutting-edge Internet applications developers. The case covers the development issues TV Guide faced in each business and the problems it foresaw trying to manage such disparate businesses under one umbrella.

TV Guide is the largest magazine in the United States and is attaining record profitability. This case details the economics of TV Guide's success by studying its advertiser and reader relationships. Presents a detailed look at how a large magazine manages all aspects of its business in the face of emerging competition.

One of the profound consequences of the ongoing information revolution is its influence on how economic value is created and extracted. Specifically, when buyer-seller transactions occur in an information-defined arena, that information is more easily accessed and absorbed, and arranged and priced in different ways. Most important, the information about a product or service can be separated from the product or service itself. In some cases, the information can become as critical as the actual product or service in terms of its effect on a company's profits. As a result, information-defined transactions--or value creation and extraction in the marketspace--create new ways of thinking about making money and thus a new value proposition. Today both marketplace and marketspace transactions are occurring. The authors have researched how companies work marketplace and marketspace to their best advantage. These companies' experiences provide a useful backdrop for thinking about the marketspace and suggest a strategic model for maximizing opportunities in this emerging area.

The largest ski resort in Colorado must determine how to select customer segments to focus its promotional and service-delivery efforts. Making segmentation work depends on reordering its pricing policy and "service packages."

Xerox Corp. is on the verge of launching a new line of photocopiers made largely from refurbished or recycled parts. In spite of this reclaimed content, the company intends to position the machines as "new." The move is a response to growing environmental pressures in Western Europe and throughout the world. The challenge is how to bring the new line to market, especially with respect to pricing and promotion.

The European Bank for Reconstruction and Development, the first supranational financial institution of the post-Cold War era, is planning its debut in the international capital markets through a bond issuance of $500 million. The bank must determine its marketing strategy for the offering on two levels--positioning of the institution and of the bond offering itself. Integral to the marketing task is the selection of a lead manager, who will determine the marketing mix. The mix decisions involve determining product (currency, maturity, coupon), pricing (yield), promotion (road shows and media relations), and distribution (formation of the syndicate). In addition, the lead manager will need to select appropriate target markets (retail and institutional investors), along with overall positioning for the institution.