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At least one co-author has disclosed a financial relationship of potential relevance for this research. Further information is available online at http://www.nber.org/papers/w24514.ack NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

This study examines top managers’ risk perceptions in internationalization decisions. 126 CEOs and top managers responsible for internationalization in companies with headquarters in Germany, Switzerland, or Austria took part in our experiment. Applying random utility theory in a conjoint choice experiment enables the measurement of top managers’ preferences for target countries and entry modes. Country-specific measures of geographic, cultural, economic, and political distances serve as covariates to explain country preferences and to quantify the effect on internationalization decisions. Our results show that distance dimensions are the primary drivers of risk assessment, whereas entry-mode choice is secondary. Internationalization may therefore be a hierarchical decision in which managers choose target market (and risk profile) and view entry-mode choice as subordinate to other environmental factors

The market for digital content (e.g., music or movies) has been affected by large numbers of Internet users downloading content for free from illegitimate sources. The music industry has been exposed most severely to these developments and has reacted with several different online business models but with only limited success thus far. These business models include attempts to attract consumers by offering free downloads while relying on advertising as a revenue source. Using a latent-class choice-based conjoint analysis, we analyze the attractiveness of these business models from the consumer's perspective. Our findings indicate that advertising-based models have the potential to attract consumers who would otherwise refrain from commercial downloading, that they cannot threaten the dominance of download models like iTunes, and that current market prices for subscription services are unattractive to most consumers.

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Movies and other media goods are traditionally distributed across distinct sequential channels (e.g., theaters, home video, video on demand). The optimality of the currently employed timing and order of channel openings has become a matter of contentious debate among both industry experts and marketing scholars. In this article, the authors present a model of revenue generation across four sequential distribution channels, combining choicebased conjoint data with other information. Drawing on stratified random samples for three major markets-namely, the United States, Japan, and Germany-and a total of 1770 consumers, the empirical results suggest that the studios that produce motion pictures can increase their revenues by up to 16.2% through sequential distribution chain timing and order changes when applying a common distribution model for all movies in a country and that revenue-optimizing structures differ strongly among countries. Under the conditions of the study, the authors find that the simultaneous release of movies in theaters and on rental home video generates maximum revenues for movie studios in the United States but has devastating effects on other players, such as theater chains. The authors discuss different scenarios and their implications for movie studios and other industry players, and barriers for the implementation of the revenue-maximizing distribution models are critically reflected.

Movies and other media goods are traditionally distributed across distinct sequential channels (e.g., theaters, home video, video on demand). The optimality of the currently employed timing and order of channel openings has become a matter of contentious debate among both industry experts and marketing scholars. In this article, the authors present a model of revenue generation across four sequential distribution channels, combining choice-based conjoint data with other information. Drawing on stratified random samples for three major markets—namely, the United States, Japan, and Germany—and a total of 1770 consumers, the empirical results suggest that the studios that produce motion pictures can increase their revenues by up to 16.2% through sequential distribution chain timing and order changes when applying a common distribution model for all movies in a country and that revenue-optimizing structures differ strongly among countries. Under the conditions of the study, the authors find that the simultaneous release of movies in theaters and on rental home video generates maximum revenues for movie studios in the United States but has devastating effects on other players, such as theater chains. The authors discuss different scenarios and their implications for movie studios and other industry players, and barriers for the implementation of the revenue-maximizing distribution models are critically reflected.