In order for Microsoft to become the leader in the console industry, it is critical to know the kind of consumers that are going to be targeted. According to the Fundamental Marketing article by Isaiah King, the target market for Microsoft Xbox users focuses on three main components: demographic, psychographic, and behavioral (Fundamental Marketing 1). The demographic of Xbox users range from age, generation, and gender. The hardcore gamers age group range from 16 to 30 years old. However, generation plays a huge role in the demographics of the console. Students of 18 years and younger are aimed highly more than older people, as they are leaders of the digital innovation. This variable of the demographic is important, as this age group will be the future industry in new products.
The Industry, domestically the video game software industry was worth $9.5 Activision Pre-merger: Activision was a leading developer and publisher of video game software for consoles. Its top titles include Guitar Hero, Tony Hawk, and Call of Duty, all of which have multiple games in their series. The company itself was moderately vertically integrated, with ownership of some development, publishing, and distribution activities. Its strengths lie in its growth strategies; partnerships allowed the firm to exclusive rights to certain brands. Other strengths include leading game titles for multiple platforms, hit sequels that are less capital intensive to develop, a stringent “green light” process for quality control, ability for online game play, and divisions in over a dozen countries. Weaknesses include lack of existence in foreign markets, lack of PC software development techniques, and the fact that licensed content is vulnerable to competition. The opportunities available are sequels to already established titles, growth in industry, and future partnerships based on their good reputation with previous alliances. Threats include competition from other software developers like THQ and Take-Two, the cyclical nature of releases, and the reliance on game consoles for use of software.
However, when Microsoft started the development of its next generation console- the Xbox 360- it recognized the deficits and problems related to its initial strategy: the company was operating under too high costs in order to assure high product availability which was not the critical factor in this business. The nature of the console business is about providing the customer with a cheap hardware and a variety of games, in order to generate profits from games sales. Additionally, the first Xbox was released one year behind Sony’s PS2, Microsoft’s biggest competitor in the market. This delay resulted in a substantial loss of sales and consequently reduced game sales. Therefore, Microsoft learned that the Xbox 360 had to be launched ahead of Sony’s PS3. Accordingly, one relevant part of Microsoft’s new strategy was the “first-to-market” approach. Another essential change in Microsoft’s business strategy concerned its cost structure in the Xbox supply chain. Whereas the initial strategy focused heavily on reliability, Microsoft changed its strategy to achieving reduced costs and increased profitability. Additionally, the company insisted on owning the design of critical components, such as the microprocessor and the graphics chip, in order to “control its own destiny”. Therefore, the supply chain network needed to be redesigned in order to support Microsoft’s strategic shift. So as to reach the desired cost
The main suppliers in the video game industry are the game makers. These companies pay a royalty fee to the company that makes the console. Game makers have the decision to make certain games exclusively for one console if they are paid enough money, for example Halo made for the Xbox, or make them available on many different platforms. This threat is also moderate for the game industry. The larger the variety of games as well as the better the quality the more likely a customer is to buy one game console over another.
The Entertainment Software Association have fought to overturn the Brown case and similar laws involving the ban of violent video games (Video Software Dealers Ass 'n, et al. v. Schwarzenegger). The ESA won all of these previous cases based on the fact of the
Southern New Hampshire University Netflix Netflix is an entertainment company that specializes in streaming media and online video-on-demand. Over the years, it has grown to include film and television production and other distribution services. Its business model has changed, and so has its overall production cost grown to keep up with the increased market share. As a result, its current position in the market has made it more exposed to competition from other firms, which is why it needs to develop new strategies to remain profitable. Netflix has grown over the past years despite competition and its unprofitability (Helft, 2007). Therefore, to understand its success, it is important provide a microeconomic analysis of Netflix, its history, its products, and the market.
Introduction Electronic Arts (EA) is a video game company that was named the “Worst Company in America” for two years in a row by readers of Consumerist. Electronic Arts had extremely negative Corporate Social Responsibility with three
Comcast practices the ‘Best-cost provider strategy’ in a business model that promotes convince for their customers by offering integrated services all on one bill. “Best-cost provider strategies are a hybrid of low-cost provider and differentiation strategies that aim at satisfying buyer expectations on key quality/features/performance/service attributes and beating customer expectations on price” (Gamble et. All) The elements in the best-cost provider strategy include: bundles with internet, cable and telephone services at varying internet speed, cable channels and levels of telephone service; different cable packages with different channels and promotional deals and
Players’ Rights to Their Likeness and its usage in video games Collegiate athletics has experienced rapid financial gain over the last twenty years. With that known, student-athletes have demanded a larger piece of the pie due to the fact that without the athletes no one would be making any of this
Time Warner vs ORC Optical Recording Corporation (ORC) was established in 1984 with the main purpose of capitalizing on the technological innovation of James T. Russell. Russell’s new technology was based on his recent invention that revolutionized recorded music storage devices. Although Russell was not the first to come up with the concept of the Compact Disk (CD), he was among the first people to patent this technology. By 1985, Russell held over 25 patents in 7 countries across the world to various technologies related to optical recording and playback. Russell's intellectual property was purchased by ORC in Toronto in 1985, the firm then proceeded to notify a number of CD manufacturers that their CD technology was infringing on
Bargaining power of suppliers: Hardware, game publisher, game developer Bargaining power of buyers: there is a high power (82) For the industry analysis, we are certain of sales since the PS4 is a consumer product particularly. For that reason, the buyer has a high bargaining power on the product. The market for casual gamers has increased seriously and sales increased after decreasing price of the PS3. Due to the uniqueness of every video game console and the games buyers have bargaining power. A small difference might be significance an extra hundred dollars for an intense gamer. People have more aware to the price difference because they play video games more casually and as a result they have more bargaining power. Buyers have a reasonable amount of power in the video game industry in particular with Nintendo. Although Microsoft and Sony have other sources of revenues, the major source of income comes from the sales of games and game consoles.
In the competitive environment, Comcast does not get threatened with new entries into the market very often as the cable and satellite industry is very costly to enter. Comcast also does not have much supplier power so that does not factor very heavily into their strategy, especially now with the increase in streaming and satellite services for television. However, the other three forces in the Porter’s five forces model are all very active in Comcast’s business model (10K Comcast, 2017). The consumers subscribing to Comcast and the businesses advertising with Comcast do possess a certain degree of buyer power, this forces Comcast to keep their prices competitive and relevant to current demands in the market (10K Comcast, 2017). The threat of substitution in this industry is growing, this can be attributed to poor customer service, higher fees and the growth of online streaming services such as Netflix and Hulu that are taking customers away from traditional cable and satellite companies (Levy,2016).
The Comcast Corporation is currently exposed to several threats with the competition continuing to increase in the industry. The biggest of these facing the organization are regulatory changes and technological changes.
In response to the market trend, the company has introduced some new products. Comcast launched a constant guard, a security program designed to help protect its high-speed internet users from online threats. Comcast also launched a beta version of Fancast Xfinity TV, its online television service. The Xfinity service gives subscriber access to hours of content not previously available online. Comcast also took the opportunity of the market trend and added to its mobile content. It released Comcast Mobile app 2.0, which includes a remote DVR programming service. Also, the company launched COMCAST4U, a mobile SMS text service, which gives customers access to frequently accessed account functions. All of these new additions will allow Comcast
Strengths The Xbox One has many strengths that can be used in order for it to become a profitable product.