1. How does Barco deliver value to its customers? How is this different from Sony's creation of value for its customers? Suppose Sony announces the launch of the 1270 in October 1989 at a price of $16,500. Barco brings value to its customers by providing technically superior projectors in a niche market; Sony creates value for its customers by offering the projectors at a lower price. Sony was the major player in the video segment and was known for its extensive reseller network and lower retail prices. Barco maintained its market share in the graphics and data segments and was known for creating higher quality projectors with more advanced technology. The simplest way to examine the value proposition of both companies is to perform a comprehensive value chain analysis of both companies. R&D/Innovation: Barco has stronger R&D/Innovation than Sony and Barco estimates that it also has more engineers than Sony. Barco is known for its innovation and use of technology, and could even achieve better projection using Sony's tubes than Sony. However, Sony has surprised Barco with product launches in the past. In 1985, Sony introduced the 1020 projector, slower than Barco's projector, but with a higher quality tube. In 1987, Sony introduced a new tube in its projector that Barco had never seen before. Manufacturing: Barco sources the majority of its tubes from Sony; while Barco believes it is a strong relationship; Sony has introduced projectors with newer tubes than previously offered at Barco. Barco is looking for more tube suppliers, but so far Sony has offered the best quality and lowest price. Barco plans ahead and maintains three months of inventory...... middle of paper ......0. Although this is higher than the comparable Sony 1270 projector, the new Barco model will be technologically superior in all factors. Its price at $19,000 shows that it is newer and more advanced, and maintains Barco's brand image as a higher quality projection company. Barco is expected to price the new BG800/BG900 model at around $28,000. The current BG400 model is priced at $24,000, so assuming the new BG800 or BG900 models will have an even higher scanning speed, the price should increase. Hopefully, by introducing its own R&D, and possibly manufacturing, of projection tubes, Barco will be able to lower the price of BG models in the future and launch the BG800 or BG900 model at $25,000, barely more higher than the current BG400 model. Product Price ?BD700 $16,000 NoBD900 $19,000 YesBG700 $25,000 NoBG800/BG900 $25,000 - $28,000 Yes