First-mover disadvantages (or late-mover advantages) rarely arise when:

• A. products are highly standardized and entry barriers are low
• B. network effects strongly favor early entrants
• C. patents and proprietary technology protect first movers
• D. brand loyalty is quickly established by initial firms

Answer: (A)

Verified step by step guidance

1. Step 1: Understand the concept of first-mover disadvantages (or late-mover advantages). These occur when firms entering a market later can benefit from the mistakes or costs incurred by the first movers, such as high initial investment, market uncertainty, or consumer learning costs.
2. Step 2: Analyze the conditions under which first-mover disadvantages are less likely to occur. For example, if products are highly standardized and entry barriers are low, firms can enter easily without significant disadvantages, reducing the chance of late-mover advantages.
3. Step 3: Consider the role of network effects. When network effects strongly favor early entrants, first movers gain a significant advantage because the value of the product increases with the number of users, making it harder for late entrants to compete.
4. Step 4: Evaluate the impact of patents and proprietary technology. These protect first movers by legally preventing others from copying innovations, thus reducing the likelihood of late-mover advantages.
5. Step 5: Reflect on brand loyalty. If initial firms quickly establish strong brand loyalty, they create a barrier for late entrants, making first-mover disadvantages rare in such scenarios.