Q8. Network Television companies (e.g. ABC, CBS, NBC, Fox) operate by broadcasti
ID: 3718093 • Letter: Q
Question
Q8. Network Television companies (e.g. ABC, CBS, NBC, Fox) operate by broadcasting their programming (Sienfeld,”Shark Tank”, “Who wants to be a millionaire”, “60 Minutes” ..etc) and selling advertisements. This industry has a low threat of new entrants since over the air broadcast bandwidth and licenses are limited and broadcast infrastructure is expensive. However, the industry has been facing new threats from Netflix and Youtube. Using the most relevant element (one force) of Porter’s five forces model, briefly describe the threat faced by Network Television companies from services such as Netflix, Youtube etc.
Explanation / Answer
Porker's idea of "Threat of Substitute products or services".
These are the main issues that made people to choose the Youtube,Netflix etc over the T,V Broadcasting Services.
Cost: - Broadcasting services charge more where as alternatives are available at affordable.
Commercial - Broadcasting has many commercials and even some commercial for 5 mins. which reduces the interest to prefer this. It can be improved by making commercial relevant to the daily life or the show at that particular time and reducing the commercial and time and decreasing the no. of commercials.
Programming Schedule :- This another foremost reason where Broadcasting service follow the schedule that might be difficult to follow up by viewers. To avoid this good Programmes should be Scheduled based on the show and content presented and depending on the viewers age group.Where Netflix and Youtube can be accessed at any time and continue to watch. And the capacity to pause and resume the show is most considerable note in this. To overcome this some Broadcasting services provide the facility to record the show to an offline device.
Screens near you is the one more reason which facilitates you with comfort of watching shows at all time and all places, where Television Broadcasting services failed in providing this.
Some survey's show that users of the Television Broadcasting services of US has been falled down from 69 million to 48 million.
Only 51% of teens(13-24) preferred the T.V and nearly 67% preferred other alternative services. Every one used to their Mobile device where it provides the all types of facilities and the data connection can provide the access to the most of the shows with less cost and more comforts like resuming, watching later, notification and updates of new releases and helps to keep up the schedule to watch at free time.
Considering all this it explains that Broadcasting services have more threat with alternatives like Netflixa and Youtube.To overcome this certain measures have to be taken by the Broadcasting Service
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