Final Exam on Strategic Management Essay Example | Topics and Well Written Essays - 3000 words

Final Exam on Strategic Management - Essay Example Based on the information provided in this case, you are required to prepare and submit a report outlining the following in your application: Statistics of the revenue generated by various online movie rental organizations prove that the evolution of the industry has moved extremely high since the time DVDs were introduced in 1997 and phasing out of VHS. Most organizations in the business of DVD/rental of DVD's have witnessed predominant growth - eg. Netflix 74%, DVD sales 34%, apart from companies such as Blockbuster video, Wal-Mart, Movie Gallery, Walt Disney's movies on demand, have reported a highly positive trend of revenue, which confirms that the market size of the movie entertainment is rapidly growing, and expected to grow further at an international market level, however with positive technology advancements. It is predicted by Analysts that the market of online movie/video game rental is expected to grow more than $30 billion by 2006. a) The geographical areas of online movie rental companies are with a spread world wide, either with direct outlets, franchises, sales of DVDs, DVD recorders, or download from the internet, thereby resulting in global competition. i. b) Number of rivals: The rental of movies are available are through: Online rentals. Physical retail stores and stand alone outlets. Physical retail store rental outlets. Websites PC downloads Piracy of DVDs Sales of DVD recorders. c) Size of Competitors and services: The introduction of consumer electronic product being sales of the Digital Video disc, where movies are available through wide range of channels, following are the various size of competitors: i. Netflix one of the world's largest online movie rental service provider, founded in 1997 and successfully achieved a base of 1 million subscriber over a span of 3 years being half the time span achieved by AOL which is another online service provider. Netflix offers a choice of 15000 movies to its customers, with leading 15 distribution outlets, where DVDs reach more than 90 percent of its subscribers with generally one business-day delivery. It also offers personalized movie recommendations to its members, and also allows members to share and recommend movies to one another. It has reported a business growth of 74%. ii. Blockbuster video - an organization in business of video cassettes, DVD and video games, with most of its revenue from United States, with their innovative program of "pay-per-view" co-branded with DIRECTV. Blockbuster reported $5.5 billion in 2002 and grown to 8500 franchised stores. They offered 44 movie selection a day to subscribers. iii. Wal-Mart - One of the largest retailer, reported an income of $244.5 billion, established itself largely in the United States with 3200 facilities and 1100 facilities abroad, with 7 distribution centres. iv. Movie Gallery: An organization that had grown after acquiring "Mom-and-pop" video stores and with further