Mike, a bit of elaboration, if I may:
"Gorilla games involve competitors using proprietary technologies with high switching costs.
Royalty games involve competitors using non-proprietary technologies with low switching costs."
The key here is who controls the "architecture" of the market. Architectures can be controlled by one company or by a group of companies.
If an architecture is controlled by just one company the architecture is called proprietary and the company can be a Gorilla (Microsoft, Intel). The difference between a Gorilla and a Chimp or a Monkey is due to Size and Position.
If an architecture is controlled by an entire group of companies then the architecture is called nonproprietary and none of the companies can be a Gorilla (fax machines, scanners). A company in these markets can be a King or a Prince, but never a Gorilla. This then is a Royalty Game. Here, the difference between a King and a Prince is Size, not Position. Note that a Prince can dethrone a King, but a chimp will almost never dethrone a Gorilla because the gorilla has position power (born of proprietary architecture ). In a Royalty Game, competitive advantage is based on executition - a Prince that executes its plan very well can challenge the King (Dell vs. Compaq).
Something else to think about: Kings vs. Chimps
The goal of the Gorilla Game investor is to own shares of Gorillas, and baskets of stocks in markets where a Gorilla is expected to emerge. It seems that some people would classify Kings as the next most desirable hold followed by Princes. However, page 184 of the manual states "After gorillas, the next most desirable holds are application software chimps if they have secured at least one dominant position in a niche market." The idea here, I believe, is that proprietary architecture is so powerful that significant benefits can accure, even to a Chimp.
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