STRATEGIC ANALYSIS FOR V7 ENIGMA

V7 Entertainment, a Vancouver, BC based video gaming company is conductinga feasibility study on technology for a brand new game console that they havedubbed V7 Enigma. The technology uses field programmable gate arrays to allocate console hardware resources dynamically to different engines for a game. V7 must decide how they should strategically enter the game console market. This paper examines external and internal factors and recommends an optimalstrategy among different alternatives of which V7 can use to enter the market.The game console industry is highly competitive and has great barriers to entry.Entering requires high set up costs and both direct and indirect network effectsprofoundly influence the market. V7 has strengths in innovation; however, these strengths are not in the hardware field. This paper recommends that V7 avoid entering the highly competitive game console market directly, but instead, licence the technology to existing hardware manufacturers.