Case of Movie Industry

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1. What competitive forces have challenged the movie industry? What problems have these forces created? What changes have these problems caused the movie &televisions studios to make?

Some competitive forces have challenged the movie industry such as – • Treats of new entrants
• Substitute Products or services
• Increasing bargaining power of customers
• Increasing bargaining power of suppliers
• Rivalry among existing competitors
Those are the major forces that have challenged these industry and these forces have made it more difficult to stand in the market efficiently. These forces have created crucial problems that affect the movie industry in a large extent which are discussed below- I. Treats of new entrants :

The developments in online movie distribution have come at a difficult time for the movie industry. At present day, the interest reduces barriers to entry, such as the need for a sales force, access to channels. It also provides a technology for driving business processes that makes other things easier to do.

II. Substitute Products or services:
With the development of on-line movie distribution, now customer can download a movie in their homes as opposed to visiting a bricks and motor store, even though customers are willing to pay a little extra for that purpose.

III. Increasing bargaining power of customers:
Availability of global price and product information shifts bargaining power to customers. As a result, DVD sales in 2008 were sharply down from previous years and marked the first time that DVD sales actually decreased from the previous year, dropping to $15.9 billion from $16.5 billion.

IV. Increasing bargaining power of suppliers:
Although supplier of movie industry can get benefited from the online movie distribution but has faced tremendous competition from other competitors.

V. Rivalry among existing competitors:
Increasing the number of competitors &...
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