NETFLIX: A COMPANY ANALYSIS Table of Contents I. Wall Street Journal Article and Executive Summary ..4 I A. Wall Street Journal Article 4 I B. Executive Summary ..5 II. External Analysis ..7 II A. Industry Definition ..7 II B. Six Industry Force Analysis ..8 II C. Macro Environmental Forces Analysis‚ Economic Trends‚ and Ethical Concerns ..15 II D. Competitor Analysis ..17 II D. 1 Netflix’s Competitors ..17 II D. 2 Netflix’s Primary Competitors ..17 II D. 3 Primary Competitors’ Business Level
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1) Market readiness (cfr. reading material and PPTs class 1‚ 2 and 4): How would you appraise and distinguish Netflix’ on-line movie rental offer compared to Blockbuster‚ Wal-Mart‚ Amazon and others‚ e.g. in terms of user-responsiveness‚ price/(added) value-for-money‚ delivery/convenience‚ …? Max. 40 lines Netflix had developed in the early days of its activity a different approach towards the movie rental industry. First of all‚ the main advantage that Netflix has regarding its competitors
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Bear Stearns & Co Page 1 of 10 Bear Stearns & Co Answer the following 10 questions‚ using the financial statement data from Blockbuster Entertainment Corporation. Show your work (i.e.‚ note what numbers you’re using). On May 9‚ 1989‚ Bear Stearns & Co. issued a report on Blockbuster Entertainment Corp.‚ which is reproduced in part below. Blockbuster-Entertainment (Ticker symbol: BV‚ Price per share: $33 ½) increased owned and franchised video stores from 19 at the end of 1986 to 415 at December
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Video Concepts Inc. Written Analysis and Communication - I Instructor Nitin Parmar Submitted by Manisha Kabra GMCS - Batch No. 25 Date January 20‚ 2011 Date: January 20‚ 2011 To: Chad Rowan‚ Owner‚ Video Concepts‚ Inc.‚ Lexington‚ North Carolina‚ United States. From: Manisha Kabra‚ Consultant Subject: Advice on alternative to select on account of no bright future growth in video rental business. This report is a summary and analysis of current situation on Video
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Cash Flow w/ EVF 330.3 233.4 152.5 N/A Analysis: The analysis of Blockbuster’s cash flows support its decision. Without Extended Viewing Fees (late fees)‚ and taking the all negative free cash flows among 2004‚ 2003‚ 2002 into account‚ Blockbuster would be performing worse than that with late fees. However‚ the trend was a continuous increase in cash flows‚ even if it is negative among all years. By taking tax effects into account‚ the free cash flow without EVF would be much lower than the
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charged by many of their competitors. They also do not charge any late fees unlike their competitor‚ Blockbuster Inc. These features of Netflix and the evolution of streaming video have helped increase revenues in the year 2011 to $3‚204‚577‚000‚ which is a 48% increase in comparison to revenues from 2010. Currently‚ Netflix Inc is faced with an onslaught of competitors such as Hulu‚ Blockbuster‚ Comcast and many other online movie sites. SUMMARY/OUTLINE This case study has centered on
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DVD’s and leave behind their old technology of VHS. They also faced the problem of most Blockbuster being a 10 minute drive from at least 70% of U.S. populated homes. This makes their whole sales pitch of people not having to leave their homes to rent movies even harder due to the number of available Blockbusters. With Netflix no late fee policy this made it easier for them to get more sales because Blockbuster charged late fees. Also‚ they came across the problem of half the movies they shipped
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DVD movie rental service. The service has created a new movie market niche which has secured them a competitive first-mover advantage in this new high-tech venture. The popularity of the service has sparked the interest of market competitor Blockbuster who may become a growing threat to Netflix should they enter the online movie rental market (Perreault‚ 2004). Netflix was founded by Reed Hastings‚ Netflix was incorporated on August 29‚ 1997 and began operations on April 14‚ 1998. Netflix began
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Since the company’s inception‚ Hasting has been exploiting disruptive innovations as a means of creating a competitive advantage over incumbents within the industry. Netflix faces stiff competition within the movie rental industry that includes Blockbuster Video and traditional “mom and pop” video rental stores. Now‚ Netflix must develop a new strategy in response to the competitive moves and technology changes within the industry. Netflix is now contemplating new strategies so that it can compete
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2/11/13 Netflix: Buy or Sell? I. Porter’s Five Forces Rivalry Among Existing Firms. In terms of the video rental industry‚ Netflix now has very few competitors. Blockbuster was the main one‚ but has since lost steam. Outside of DVD rentals however‚ the competition is much more intense. Netflix directly competes with cable companies like Charter‚ On-Demand channels‚ and even Tivo. Online streaming companies such as Hulu are also major competitors. Barriers to Entry. The difficulty in entering
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