Classroom Companion: Business

12.3.3 
 Incompatibility and Compatibility
There are several examples where incompatible formats, procedures, or technologies 
may lead to lock-in. Some examples of lock-in caused by incompatibility are in 
7
Example 
12.2
. A more complex case is backward compatibility since it sometimes 
is used to avoid lock-in, while in other cases, backward compatibility creates lock-in. 
7
Example 
12.3
 discusses the effect backward compatibility may have on lock-in.
12.3 · Lock-In Mechanisms

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12
 
► Example 12.2 Lock-In by Incompatibility
Lock-in by incompatibility is best exemplified by the lock-in strategy of Microsoft 
known as embrace, extend, and extinguish (EEE) (See Wikipedia article: Embrace, 
extend, and extinguish):
5
Embrace: base the product on a public standard also used by competitors.
5
Extend: add features not in the standard that cause interoperability prob-
lems with other products based on the same standard.
5
Extinguish: because of dominant market shares, the new product may 
become a de facto standard squeezing out competitors not having access to 
the extensions. The users are then locked into a Microsoft product.
App Store and Google Play Store are incompatible marketplaces for software applica-
tions for smartphones, and since the platforms are incompatible, the user cannot switch 
from an Android telephone to an Apple platform (or vice versa) without losing down-
loaded apps—the two marketplaces require incompatible types of smartphones.
Skype is an over-the-top technology incompatible with voice-over-IP (VoIP) tech-
nologies such as the technology used in 4G and 5G mobile systems. Both parties in a 
conversation need Skype software to encode and decode the speech samples. Skype is 
indistinguishable from other web services and is therefore not subject to specific user 
charges. This cause lock-in to Skype services, particularly, for long-distance telephone 
calls. Skype is just one example of incompatible file formats causing lock-in to a particu-
lar technology.
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