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Unformatted text preview: 3. I believe that HDNet should charge the carriers $30-$40 per subscription for access to its channels and original programming. HDNet is in the introductory stage of its product life cycle and will have high costs. By charging a high price HDNet will help overcome those costs and still have profits. At the same time because high definition is relatively new, there are a limited number of competitors in the market so entering this new market and obtaining a strong amount of market share should not be challenging. HDNet cannot charge too much though because many of the cable providers will be looking to distribute HDNet in package deals, so if HDNet is too high they will not be able to distribute their product as easily. Pricing HDNet around $30 - $40 would be high enough so that the price would give HDNet the perception of being high quality which is just what they want....
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- Fall '10