Case Analysis:competition In The Movie Rental Indu

1400 Words6 Pages
Date: Feb.16th 2011-2-18 To : Sabine Turnley From: Vincent Xu Re: Case Analysis:Competition in the Movie Rental Industry in 2008: Netflix and Blockbuster Battle for Market Leadership Executive Summary The movie rental is the most popular way to watch movies outside a theatre in the U.S. As the improvement of technology, this industry has been increasing in market position of the whole movie industry and cutting the sales of movie DVD. In this Memo, I will first give a overall analysis of the entire industry, identifying the upcoming trends, specifically addressing the competitive factors, the driving forces, and the key success factors of this industry. After that, the analysis will go to the two main competitors in this industry, Netflix and Blockbuster, about their strength and weakness, future opportunities and threats, and their current financial performances. Finally, I will give some advice to recommendation to both companies based on the conclusion of the analysis. Analysis The competitive forces of this industry, which mainly come from rivalries and suppliers, are relatively strong, and thus make this industry highly competitive. First, because of the recent economic crisis, the total amount of the maket demand is growing slowly. It even experienced a slight shrinking during 2006-2007. Second, the services of which each competitor can provide(rent movies both pysically and digitally) are standardized to a large degree, while none of the competitor could use a exclusive competitive weapon to gain significant advantages. At the same time the leader of the industry, Blockbuster, has recently replaced its CEO and craft a lot of aggressive movement to maintain their market position and rejuvenate profit. These factors make the competitive force from rivalry extremely strong. Besides rivalry forces, the forces come from suppliers are also

More about Case Analysis:competition In The Movie Rental Indu

Open Document