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Launched in early 2005, Zopa is a peer-to-peer online brokerage that couples British residents who want to lend with those who want to borrow. The company represents a new business model in the retail financial services industry, and since Zopa is not technically a bank and does not lend money itself, the capital requirements to run the business are relatively small. Compared to a traditional full service bank Zopa concentrates on only a few steps of the value chain. This case study provides an overview of the financial service industry, especially banks, in the UK in 2006 and how Zopa, a value innovator, has developed a unique position in the market through an innovative business model. Rich data especially on banking trends are given. Additional data on key players in the industry are supplied. This data will enable students to develop a good understanding of the elements of a value innovation and how technologies have the potential to shake up an established industry structure and its key players. A focus is on the concept of value innovation and sustainable competitive advantage. The case can also be used to address the topic of how incumbent firms should respond to innovative new business models.

The case provides an overview of the financial service industry in the UK in 2006 and how Zopa, a value innovator, has developed a unique position in the market through an innovative business model. Rich data especially on banking trends are given. Additional data on key players in the industry are supplied. This data will enable students to develop a good understanding of the elements of a value innovation and how technologies have the potential to shake up an established industry structure and its key players. A focus is on the concept of value innovation and sustainable competitive advantage.

This paper allows for endogenous costs in the estimation of price cost margins. In particular, we estimate price-cost margins when firms bargain over wages. We extent the standard two-equation set-up (demand and first-order condition in the product market) to include a third equation, which is derived from bargaining over wages. In this way, price-cost margins are determined by wages and vice versa. We implement the model using data for eight European airlines from 1976-1994, and show that the treatment of endogenous costs has important implications for the measurement of price-cost margins and the assessment of market power. Our main result is that observed prices in Europe are virtually identical to monopoly prices, even though observed margins are consistent with Nash behavior. Apparently, costs had been inflated to the point that the European consumers were faced with a de facto monopoly prices.

© Blackwell Publishing Ltd. 2006

Looking outside the confines of the usual business sphere, we find that Madonna is a born entrepreneur.Jamie Anderson and Martin Kupp reveal the business side of an entertainment legend.

© 2006 The Author Journal compilation © 2006 London Business School

Purpose - This article seeks to discuss LUZ, a Brazilian energy supplier that has decided to use their network for telecommunication. Design/methodology/approach - This case describes the acquisition-process from the perspective of the ESCRA sales manager, whose actions are analyzed, evaluated and discussed in class. Findings - LUZ, a Brazilian energy supplier, has decided to use their network for telecommunication. They found a subsidiary named LUZATEL for purchasing the required IT equipment. Four IT companies make it to the short list. One of them is ESCRA. ESCRA is a large Swedish producer of telecommunication equipment, who has recently started to additionally offer IT solutions. Originality/value - This paper uses a Brazilian energy supplier as a case study.

With permission of Emerald