Nowadays, movie rental industry has become one of the most competitive industry, just a bit behind mobile devices industry. This industry depends mostly on the advanced technology and content right management. Over last few decades, movie rental industry has made a significant shift from DVD-delivery services to online video streaming services. This essay mainly focuses on analyzing the current marketplace of video on demand with the special case of Netflix and a little bit about Blockbuster.
1. HOW STRONG ARE THE COMPETITIVE FORCES IN THE MOVIE RENTAL MARKETPLACE? DO A FIVE-FORCES ANALYSIS TO SUPPORT YOUR ANSWER.
Movie rental marketplace has become highly competitive these days as the rise of number of companies offering services to win customer’s loyalty. With the aim of winning customer’s loyalty, the companies need to change their modes of operation to respond to the need of the customers. There are quite a few number of companies these days still offer the disc-by-mail services such as Netflix, Blockbuster and RedBox. Blockbuster is the most famous brand in movie rental in the past. However, it has been surpassed by Netflix with the “all-you-can-eat” subscription plans where you only have to pay a certain amount of money and enjoy unlimited numbers of disc you can view. RedBox is a newcomer in this field with the use of vending machines those allow people to rent movies and games conveniently in stores or malls. As technology advances, online streaming has become more popular these days, results in a lot of new firms wanting share in the video renting market. Those firms are Apple, Amazon and Hulu… to name a few. If any firm wishes to survive in this market place, it needs to adapt new strategy and business model in order to keep up with the modern technology as well as people’s taste. Below is the five-force analysis with the model Netflix:
Threat of new entrance:
There is a medium level of this threat for Netflix because it requires...