Question

Name the industry or strategic group your firm is in (or a former firm) and state the name of one direct competitor. Look at the video on Business ecosystems (Business ecosystems come of age) and the video on Two Forces (Two Forces Shaping the Future of Business). What is an ecosystem and what are the two forces? Explain how these apply to the industry named above. What is one Threat and one Opportunity from this explanation (Note: T and O affect the profitability of the entire industry).  

Answer 1

The selected company here is Netflix, which competes in the entertainment industry and focuses on mass media. The Direct competitor for Netflix is Amazon Prime videos.

Ecosystem:

Ecosystem refers to the metaphor that points to a deep interdependence across players as they coevolve and together create and share resources for sustained success.

Two forces:

According to the video, the two forces are market fragmentation and market concentration.

How these concepts are applied to the entertainment industry with reference to Netflix

As the entertainment industry has the customers of various age, preference, and gender, the companies focus on the niche group to serve and attract. According to the concept of ecosystem, the different players are the viewers, subscribers, producers, directors, writers, photography teams, and performers. To get the maximum benefits these players create unique content as per viewers’ demands.

Threat and Opportunity:

From the explanation, the threat for the entertainment industry is a lower barrier to entry, due to the cheap and easy access to technology. Small firms that are fragmented can also compete with the giants and become part of a concentrated market. Opportunity for the entertainment industry is learning new things have fewer barriers, so the new and unique content for the target audiences is easier to develop. For Netflix and other giant players have financial resources to create differentiated content.