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Group Case Study 1: NetflixDavid Beauregard (Group 1)BUSI 690 (Policy and Strategy in Global Competition)Dr. Jonathan WilsonLiberty University
SWOT AnalysisStrengths1. Convenience2. Swift domestic growth3. High-quality selection of independent films4. Strong value5. Original content quality6. Emphasis placed on film ratings by customers7. Customer retention strategy8. Ease-of-use9. Utilization of emerging technologies10. Strategic partnershipsWeaknesses1. Slow international growth2. Impediments to international market participation3. Loss of exclusivity contract with Epix to Amazon.com4. Decline in DVD-by-mail subscriptions5. Expired contracts with Sony and Starz6. Difficulty with raising subscription prices7. Significant cost of acquiring content8. Slowing domestic subscriber growth9. Internet connectivity issues10. Questionable response to new net neutrality rulesOpportunities1. Decline in cable television subscriptions2. Increase in consumer ownership of streaming devices3. Increase in opportunities to expand globally4. Continued opportunities to develop original content5. Constant release of new content such as films and television programs6. New licensing opportunities7. Failure of competitive forces such as Redbox's Redbox Instant8. Continuing popularity of original programs9. Lower cost of purchasing televisions10. Increase in demand for streaming videoThreats1. New net neutrality rules2. Loss of contracts to competitors3. Faster international success on the part of some competitors4. Desire on the part of established organizations to stream video online5. Partially-free streaming services such as Hulu6. Overreliance on outside entities such as internet providers7. Large corporations are entering the industry8. Swift decline in DVD rentals9. Emergence of rental kiosks such as Redbox10. Video-on-demand offerings by cable television providersStrengths
Netflix is a unique company that offers its customers a service that is both highly popular and convenient (Napoli, 2014). The firm has experienced swift growth over the past decade and continues to grow at an accelerated pace (Rothaermel, 2013). It offers its customers an extensivelibrary of films and television programs that can be watched by subscribers at any time for a low monthly cost. While firms such as Blockbuster placed a heavy emphasis on providing new releases for rent, Netflix gained a reputation for its high-quality offering of independent and older films (Rothaermel, 2013). It is notable that Blockbuster has failed while Netflix has succeeded and grown at an unprecedented rate.