I’m sure most of us remember our first video game experience, whether it was NES (regular Nintendo to some of you) or Sega Genesis, we have seen these companies advance in technology, but not all of them have stayed in the race, due in large part to network effects.  Does anyone remember Sega Dreamcast? It was a sophisticated system on the level of Playstation 2 and Xbox, yet it died out shortly after release.  This happened in part to network effects, because the dreamcast was released at a higher price (since it was the highest tier console at the time it was released), yet it did not have a great assortment of games or following of fans to battle the lower priced and more gaming selection opponents of the N64 and playstation2.  Also, lots of video game companies try to make their new product better than their competitors so they can get people to switch.  As was on problem set 5 (trying to get people to switch from an established product to your newer better product), they try to lure people who are already purchasing a well founded item in a network, to an item which has relatively few people.  Companies do some of the following to lure these people from other established items to their products: patent the right to games (E.G playstation has the right to final fantasy games), develop games from within the company (E.G Nintendo develops the super mario series), have extra accessories (E.G playstion 3 has a blue ray DVD player option available).  All of these attributes cause network effects to help (or cripple in some cases) these video gaming companies.  These consoles directly correlate to different networks because all of them are extremely incompatible with on another.  One cannot play an xbox game on a playstation3, or vice versa.  This incompatibility keeps the networks separate, and competition intense.  The system with the biggest network (most people buying their product) will have the largest network and most benefit from network effects.  A complexity can arise however, because some consumers can own multiple consoles (thus being parts of both networks), but from a strictly console-based-network, the consoles are incompatible but the users may be compatible with both networks.  Sources: http://ieeexplore.ieee.org/iel5/4076361/4076362/04076701.pdf?isnumber=4076362&prod=CNF&arnumber=4076701&arSt=160b&ared=160b&arAuthor=Jochen+Strube%3B+Sven+Schade%3B+Patrick+Schmidt%3B+Peter+Buxmann