Hello, and welcome back to advanced competitive strategy. For this fourth module of our course, we have traveled to a very special location. We are here at Lake Chiemsee, and, believe it or not, I'm standing right in front of a castle on an island. The Royal Palace of Herrenchiemsee as this castle is called, is about an hour's drive from Munich, and it's one of the many famous castles in Bavaria, including Nymphenburg Palace, which is directly located close to the center of Munich, and Neuschwanstein Castle, the inspiration for the castle in Disney's Sleeping Beauty. The Royal Palace of Herrenchiemsee right behind me was built by King Ludwig II who was also known as the fairy tale king. Ludwig was argued to be a dreamer and a very artistic soul. So, what many people don't know about him, however, is that he was also a technological pioneer. So, he went to the international exhibition 1867 in Paris to admire the technological achievement of his time and embraced them when it came to designing his own residences, some of which had electricity, warm water, and a fully functioning telephone system installed in them. So, let's go inside and I'll see you again in the great hall of mirrors. In this module, technological progress, adoption, and network effects will also play an important role as we're going to discover two very important new concepts, which are going to help us increase our businesses' profits and returns. Network effects and the boundaries of the firm. We will find that considering these two concepts and formulating our business strategy can help us improve our strategy's effectiveness and eventually increase our returns. The next four videos will be dedicated to network effects. Sadly, as a pioneer, Ludwig did not have many people to talk to over his phone system, and his utility didn't increase much during his lifetime. But obviously, things have changed in the meantime. Let's find out in the next four videos. [BLANK]
