Viacom, The American Media Collaboration

Paramount is a potential merger target to Viacom and QVC for a few key reasons outlined below:

1. Netflix’s original marketing strategy offered several flat-rate monthly subscription options; in which, members could stream movies and shows via the Internet or have disks sent to their homes in a pre-paid and pre-addressed envelope. Free from the despair of due dates and late fees, members could keep, up to, eight movies at a time. Upon the return of a disk, Netflix would automatically mail out the next movie from the customer’s video queue. Members were able to change and update their queues as frequently as they liked. The sheer innovation of Netflix’s strategy encouraged several competitors to enter the market to compete directly,

As a conclusion it is important to remark that an established brand as it was Netflix, failed to remain at the forefront and not continuously meet the needs of the consumers who demanded updates in accordance with technological communication updates that occurred. The company Netflix was slack and reactive rather than proactive as it should be this situation allowed Redbox took hold of a huge market. On the other hand, the blue waters can go turning into red over time, as other companies may feel very attracted to the new market opportunities that have opened.

Viacom Inc. is one of the largest media company in the world with leading positions in broadcast and television, radio, outdoor advertising and online. The company operates its business through two segments: Media Networks and Filmed Entertainment. It provides entertainment content through its TV channels like Nickelodeon, MTV, VH1, Comedy Central, and others. Viacom’s filmed entertainment segment produces, finances, acquires, and distribute motion pictures under the banner of Paramount Pictures, MTV Films, and others. The company also provides online content services like video-on-demand, pay television, basic cable television, and many more. Viacom Inc is publicly traded on NASDAQ at $33.99 price per share as of May 18,

Hulu is a first mover in this space and is currently enjoying the first mover advantage. However with the ubiquity of internet technology accompanied by lower costs and the commoditization of the technology, the barrier to entry will be reduced and more players will be attracted to the profitable online video business, eating into Hulu’s profitability and success. Also, the increase in IT investments in the internet age causes “a Winner-take-all dynamic and high turbulence, as each group of dominant innovators is threatened by succeeding waves of innovation” (McAfee and Brynjolfsson, 2008) in Schumpeterian competition. This makes Hulu’s success vulnerable.

For the past ten years, Hulu has been among the most competitive online streaming services. Beginning as a joint venture created by 21st Century Fox and NBCUniversal to “distribute their television programming over the Internet,” (Harvard 2017) Hulu has expanded generously, offering the four largest broadcasting networks. In the wake of a new television era, Hulu has the potential to serve as a Multichannel Video Programming Distributor (MVPD). The following write-up includes an analysis of Hulu’s current market standings, including an investigation of growth statistics as well as the company’s overall marketing situation.

Abstract Comcast Corporation (NASDAQ: CMCSA, CMCSK), a company based in Philadelphia primarily provides competitive bundled-package, which consists video, high-speed internet, phone, wireless security and automation services to both residential and commercial customers, with estimated TV-market share of 24% in United States. With the introduction of Xfinity brand services, 80% of Comcast’s revenue is generated from its video services. Comcast’s innovative products/services facilitate current position in market share, however there are dynamic competing market forces like flooding of social medial and new gaming devices that are intensively changing how the American working-class and younger generations watch series of TV programs. Hence this

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.

Entering and transforming the video rental industry was a large undertaking for the start-up company. The first marketing objective the company undertook was the process of building a brand. Netflix’s identity was crucial to future growth and success. Without a strong brand, competitors with deep pockets could have easily duplicated the company’s business model. Secondly, leveraging technology was critical to establishing the business and infrastructure growth. The consumer base was the final objective Netflix sought to achieve. Retaining and growing subscribers were fundamental to revenue and marketing goals.

Consequently, this has resulted in the company shaking the old fallacy of CBS being the “old person’s network”. As a result, CBS has been dubbed “the king of networks”. While CBS is considered to be downtrending, it is still known as the leader in their industry: this speaks to how advanced the company is in comparison to their competitors. CBS biggest weakness is that they continuously have to try to shake the myth that they are an “old person’s company”. The biggest opportunities that lie in front of CBS as a whole is new shows and networks, for example, the CW. The CW, as referred to in the last paragraph, reaches out to younger viewers. The biggest threats that lie in front of CBS is intense competition, with networks like Fox, NBC, Disney, etc. the TV business is brutal competition. Additionally, since CBS is a news station, political changes have a significant effect upon the company. CBS is known for having a liberal bias and has long been scrutinized by conservatives; conservatives are far more likely to invest with stations like Fox

The primary industry consists of close competitors while the secondary industry includes organizations that might directly or indirectly impact the company (Parnell, 2016). Netflix primary industry is the video streaming industry with competitors like Hulu and Amazon Prime, while their secondary industry is the entertainment industry as a whole which includes traditional television and movie. Netflix started out as a mail-order DVD service the had evolved into an on-demand streaming service. While they were the first mail order subscription service, other competitors such as blockbuster also tried to get into the market. However, blockbuster ended up bankrupt and out of business. While the television industry has taken years to feel the threat of Netflix, times are changing. Netflix now has a market share of forty-billion dollars. In the future, Netflix will have a large part in shaping the future of television. People are taking to Netflix due to their commercial free platform and binge-watching ability. Netflix has been referred to as the “platinum age” of television where viewers can watch television when

One the one hand, the fertility of the industry opened the doors to corporations that sighted substantial growth potential. New entrants with big pockets such as Walmart could pose a certain threat to Netflix, by exploiting a playing card based on cost reduction. On the other hand, barriers to entry became relatively significant as established video rental retailers such as Netflix have the experience and the knowhow to market movies to people. In this industry, firms that do not have a technological advantage can’t compete. The best example is Netflix’s CineMatch program that offered personalized film recommendations based on customer’s rental patterns. This way, Netflix was able to better serve its subscribers. From a cost perspective, the movie rental industry requires high capital expenditures, and the major expenses are highly related to acquisitions of DVD library and investments in technology (exhibit 2 continued). Thus, we may say that entry is difficult in this industry as the competing firms have reputation, experience and recognizable brand names.

Netflix exhibits dominant economic characteristics in the online movie rental business. They enjoy strong market size and growth rate when compared to rivalry competition. The number of rivalries are increasing, and the market remains dominated by only a few sizeable rivalries like Blockbuster Video, Wal-Mart, Walt Disney Movies and Movielink’s Downloadable Movies. Netflix is determined to offer new and innovative technology to sustain their competitive advantage.

Today, digital technology and the Internet are deeply reshaping the motion picture industry with a trend toward the digitalisation and disintermediation (Zhu, 2010). Media streaming services are an example of this current restructuration. Providing an access to a wide collection of entertainment online at a cheap price, they have penetrated the monopoly that cinema once enjoyed (Herberg, 2017). A significant example can be found in the US company ‘Netflix’, source of nearly a third of all North American downstream internet traffic at peak hours (Hallinan & Striphas, 2016). Once a small DVD subscription service created in 1997, it offers today to its subscribers to watch its own produced movies and shows as well as content of other

Many of their competitors have longer operating histories, larger customer bases, greater brand recognition and significantly greater financial, marketing and other resources than Netflix does. Some of their competitors have adopted, and may continue to adopt, aggressive pricing policies and devote substantially more resources to marketing and Web site and systems development than Netflix does. The rapid growth of their online entertainment subscription business since their beginning may attract direct competition from larger companies with significantly greater financial resources and national brand recognition. For instance in 2003 the extremely wealthy Wal-Mart used their online site to launch an online DVD subscription service, Wal-Mart DVD Rentals. With increased competition reduced operating margins may result as well as a loss of market share and reduced revenues. In addition, our competitors may form or extend strategic alliances with studios and distributors that could adversely affect our ability to obtain titles on favorable terms.