EMI - Cat Scanners

994 Words4 Pages
In 1972 EMI Ltd., a company located in the United Kingdom with a history in music and electronics business, wanted to enter the competitive medical equipment business. The group's central research laboratory had developed a revolutionary x-ray imaging device named CAT SCAN. The CAT SCAN was characterized by linking conventional x-ray with data processing and cathode ray tube display technology. All three of these technologies were in existence. The technology EMI developed allowed for the integration of these components to produce three-dimensional radiographic images of body versus regular x-ray, which provided only two-dimensional imaging. Regular x-ray dominated medical imaging at the time and the US was the major market. They had challenges as the early innovator/ first mover and had to protect market share. One of the strategies contemplated was licensing of the product. This strategy was rejected by EMI management. Management at EMI believed that their technical expertise and patent protection would provide a significant barrier to entry by other competitors. Their expectation was that these competitive advantages would give them three or four years to establish a solid market position. It was asserted that licensing of the product through major x-ray equipment suppliers would result in lack of promotion of the product. It was felt that CAT SCAN would compete with standard x-ray equipment and thereby not get the promotion it needed by the licensees. This assertion seemed to be contrary to the belief of EMI management that CT SCAN would not displace the majority of existing diagnostic imaging applications (page 128 4th paragraph). This concern could have been averted by aggressively marketing towards potential licensees. The potential success was apparent and management could have capitalized on that. As it turns out conventional x-ray was and still
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