Editing Network effect (section)

==Technology lifecycle==
{{see also|Technology lifecycle}}
If some existing technology or company whose benefits are largely based on network effects starts to lose market share against a challenger such as a [[disruptive technology]] or [[open standards]] based competition, the benefits of network effects will reduce for the incumbent, and increase for the challenger. In this model, a tipping point is eventually reached at which the network effects of the challenger dominate those of the former incumbent, and the incumbent is forced into an accelerating decline, whilst the challenger takes over the incumbent's former position.<ref>{{Cite journal |last1=Wolf |first1=James R. |last2=Portegys |first2=Thomas E. |date=September 2007 |title=Technology Adoption in the Presence of Network Externalities: A Web-Based Classroom Game |journal=INFORMS Transactions on Education |language=en |volume=8 |issue=1 |pages=49–54 |doi=10.1287/ited.8.1.49 |s2cid=8736463 |issn=1532-0545|doi-access=free }}</ref>

[[Betamax|Sony's Betamax]] and [[JVC|Victor Company of Japan]] (JVC)'s [[VHS|video home system]] (VHS) can both be used for [[Videocassette recorder|video cassette recorders]] (VCR), but the two technologies are not compatible. Therefore, the VCR that is suitable for one type of cassette cannot fit in another. VHS's technology gradually surpassed Betamax in the competition. In the end, Betamax lost its original market share and was replaced by VHS.<ref name=":1" />