2) Acquiesce in the academic unit segment, allowing Bose to attain an estimated

32% share of the portable speaker market at the current 17% margin (also leaving

headphone margins unchanged at 6%).

In both situations, we expect total market size to remain constant. Academic

purchasing

is not susceptible to large fluctuations in the purchasing cycle. Sales quantity would

be

higher if there were a price war, of course, but you can ignore that complication; I

have

other people thinking about that and I want you to focus on the big picture strategy of/nthe

price war or not if Bose enters.