Record Label and Sound Buzz

Question 1.

Analysis of Sound buzz and its business strategy using the competitive force model. What strategies did it develop for dealing with competitive forces?

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Porter’s Competitive Forces Model in Sound buzz’s

|Forces |Forces in Sound buzz |Impact |
|Threat of new entry of new competitors |P2P,Napster, iTunes |New competitor – possibility of losing business or |
| | |share profit among the new entry |
|Buyer’s ( customer) bargaining power |customers buying music sharing among their |Reduce price and also push to increase quality and |
| |friends |service |
|Supplier’s bargaining power |Record labels, EMI, BMG, Sony, limiting their |Increase price, reduce quality |
| |powers | |
|Threat of substitutes products or service |Napster sell much more lower cost |Reduce demand / loss sales |
|Rivalry among existing firms in the industry |CD shops |Competition on price and services, quality |

Micheal Porter has proposed model that have become popular ways to study and explain basic business activities that is Competitive Forces Model (Porter 1985). These frameworks us use to analyzing Sound buzz’s competitiveness and used