IMAX Larger Than Life
Adnan Bahrami
MGT 401 H
Dr. Makri
01 November 2010
IMAX Individual Paper After reading the IMAX: Larger than Life case and Are Movie Theaters Doomed? article, the theory learned in class is applied to decide whether IMAX would lose its differentiation if it exhibited too many Hollywood movies. Additionally, the company faces the question whether it should be sold to a larger studio such as Sony, Disney or Time-Werner. In the beginning, I discuss the impact of the General Environment on the movie theater industry. Subsequently, Porter’s five forces model is applied in identifying the opportunities and threats for IMAX. Explanation of how the resources, capabilities, and core competencies support both business and corporate strategies follow the model. The final part describes the reason behind the company changing its business and corporate strategies and if it can survive as a niche player that only produces large format films and systems. The General Environment
Demographic Segment
To begin with, IMAX happens to be in three different industries: Photographic Equipment and Supplies, Motion Picture and Video Tape Production, and Motion Picture and Video Distribution. Obviously, the demographic segment relevantly applies only to the Motion Picture Exhibition industry because looking onto the demographics of the other industries is completely irrelevant. In this paper, I will mainly concentrate on the exhibition industry unless it is relevant to apply the theory to the other industries. However, I will explicitly mention if I do so. According to the IMAX case, the audience can be broken down to three categories. The 12-24 year olds represent 38% of admissions and they also happen to render 41% of the movie attendance frequency. The 25-39 year olds follow in representing 29% of admissions (IMAX p.10). Although the case does not provide statistics for the third category, the article depicts that the 40-59 year olds, the aging baby boomers, represent around 25%
MGT 401 H
Dr. Makri
01 November 2010
IMAX Individual Paper After reading the IMAX: Larger than Life case and Are Movie Theaters Doomed? article, the theory learned in class is applied to decide whether IMAX would lose its differentiation if it exhibited too many Hollywood movies. Additionally, the company faces the question whether it should be sold to a larger studio such as Sony, Disney or Time-Werner. In the beginning, I discuss the impact of the General Environment on the movie theater industry. Subsequently, Porter’s five forces model is applied in identifying the opportunities and threats for IMAX. Explanation of how the resources, capabilities, and core competencies support both business and corporate strategies follow the model. The final part describes the reason behind the company changing its business and corporate strategies and if it can survive as a niche player that only produces large format films and systems. The General Environment
Demographic Segment
To begin with, IMAX happens to be in three different industries: Photographic Equipment and Supplies, Motion Picture and Video Tape Production, and Motion Picture and Video Distribution. Obviously, the demographic segment relevantly applies only to the Motion Picture Exhibition industry because looking onto the demographics of the other industries is completely irrelevant. In this paper, I will mainly concentrate on the exhibition industry unless it is relevant to apply the theory to the other industries. However, I will explicitly mention if I do so. According to the IMAX case, the audience can be broken down to three categories. The 12-24 year olds represent 38% of admissions and they also happen to render 41% of the movie attendance frequency. The 25-39 year olds follow in representing 29% of admissions (IMAX p.10). Although the case does not provide statistics for the third category, the article depicts that the 40-59 year olds, the aging baby boomers, represent around 25%
Cited: Nair, Anil. IMAX: Larger Than Life. 19 May 2009. Ivey School of Business. 01 Nov. 2010 <http://cb.hbsp.harvard.edu/cb/access/6415669>. Silver, Jon and John McDonnell. Are Movie Theaters Doomed? Do Exhibitors see the Big Picture as Theaters lose their Competitive Edge?. 01 Nov. 2007. Business Horizons. 01 Nov. 2010 <http://cb.hbsp.harvard.edu/cb/access/6415669>.