ContentCompany profile

PEST analysisFive forces analysis

Value chainCanvas modelCore problem

Differentiation matrixCanvas model +5

Strategy

No mission and vision!StatementBecoming the best global entertainment distribution serviceLicensing entertainment content around the worldCreating markets that are accessible to film makersHelping content creators around the world to find a global audience

Company profileFounded in 1997

Flat rate DVD by mail

Data mining

Successful transition to streaming content

>40M members, > 1 billion hours of TV Shows and movies per month

PEST analysisPolitical

Piracy

Content licenses and copyright

Economical

Unlimited market size

Technology applicable for all countries

Social

Wish to watch on tv screen, applicable

everywhere

Technological

VOD increased popularity, Need for high

internet speed

Five forces analysisThreat of new entrants – high (Apple, Amazon, Hulu, Youtube)Threat of substitutes – high (Apple TV, Hulu)Bargaining power of customers – high (a lot of choice for substitutes)Bargaining power of suppliers – high (content is key)Intensity of rivalry – high (HBO, low entry barriers, major players present)Complementors – high (Microsoft, Wall-Mart, Roku, Vizio, LG)

Market Life Cycle

Value chain Model

Canvas Model

Strenghts – Data, experience, # shows and movies

Weaknesses – Fixed costs, high debt, system not flexible

Opportunities – Europe, NEM, original content

Threats – changing technology, rising prices, competitive markets

SWOT analysis

Confrontation matrixSWOT Europe NEM Content Tech Prices Markets

Data ++ + - + o ++

Exp. ++ + - + ++ ++

# ++ ++ + ++ ++ ++

Fixed + + + -- + +

Debt o o -- -- -- -

System - -- o -- o -

Threat of all five forces is high

Power of suppliers and buyers is especially high

Netflix is stuck between powers

Core problem

Canvas Model +5

StrategyPursue market penetration strategy by excellent service and low prices

Focus on creating its own content to maintain competitive advantage

Increase its innovation budget by 5% next year and continue to do so

Use pricing as a last resort measure to increase margin

Choose to stream content only, milk its mailing DVD’s within the next 5 years

Create more partnerships to create perfect hardware platform for its software

Continue its high availability distribution strategy