Reading Comprehension

Traditionally, the first firm to commercialize a new
technology has benefited from the unique opportunity to
shape product definitions, forcing followers to adapt to a
standard or invest in an unproven alternative. Today, how-
( 5) ever, the largest payoffs may go to companies that lead in
developing integrated approaches for successful mass
production and distribution.

Producers of the Beta format for videocassette recorders
(VCR's), for example, were first to develop the VCR com-
(10) mercially in 1975, but producers of the rival VHS (Video
Home System) format proved to be more successful at
forming strategic alliances with other producers and
distributors to manufacture and market their VCR format
Seeking to maintain exclusive control over VCR distri-
(15) bution. Beta producers were reluctant to form such alli-
ances and eventually lost ground to VHS in the compe-
tition for the global VCR market.


Despite Beta's substantial technological head start and
the fact that VHS was neither technically better nor cheaper
(20) than Beta, developers of VHS quickly turned a slight early
lead in sales into a dominant position. Strategic alignments
with producers of prerecorded tapes reinforced the VHS
advantage. The perception among consumers that prere-
corded tapes were more available in VHS format further
(25) expanded VHS's share of the market. By the end of the
1980's. Beta was no longer in production.


Which of the following best describes the relation of the first paragraph to the passage as a whole?
(A) It makes a general observation to be exemplified.
(B) It outlines a process to be analyzed.
(C) It poses a question to be answered.
(D) It advances an argument to be disputed.
(E) It introduces conflicting arguments to be reconciled.

[spoiler]OA: A[/spoiler]

I have thought that in first paragraph, it was said that traditionally the innovators would get benefits, but now it goes to the producers of integrated producers. So this is a conflicting argument. And hence E should be the answer.

Where am i missing?

Thanks.

You need to be really careful regarding the question, re-read it if you must. Your question is: Which of the following best describes the relation of the first paragraph to the passage as a whole? This means that you need to look at both paragraphs at the same time. What you mention in your explanation summarizes paragraph 1 only: indeed, there is a paradox in that passage, but the paradox is EXEMPLIFIED in the second paragraph with the VCR VHS thing.