Porter’s Five Forces Essay Example
1(a) Critical external and internal environmental factors that has a strategic implication for Apple’s future
When relating to the external factor which has a strategic implication for Apple’s future, it can be best described using Porter’s five forces.
Threat of new entrants
Threat of substitutes
Bargaining power of suppliers
Bargaining power of customers
Intense competitors at current state
Porter’s Five Forces Current rivalry: Apple faces an intense and fierce competition in the PC market, which has a very low switching cost. Competition comes from IBM, Dell, HP and Toshiba. In the multimedia solutions category, initial companies such as Napster and Kazaa was the main rivals to Apple’s iTunes and iPod but due to illegal piracy and legal issues, it dies of leaving Apple as the leader in this category till present. For Apple TV, it faces stiff competition from Amazon Unbox, CinemaNow, HP, Disney, Movielink, Wall-Mart, Sony and many more. For iPhone, it is Motorola, Palm and Blackberry. When relating to the PC industry, price competition has become severe, so cost cutting is essential to cover decreasing profit margin. Dell has been able to apply this while others are suffering from negative growth rates. So it remains a challenge for Apple. Threat of new entrants:. Since existing companies like Apple have created strong brand name with products like iPod and iTunes, so it’s a difficult task for new entrants to make a name. Even so, there are possibilities of availability of streaming audios with v-cast (Verizon), on demand online downloads that functions similar to iTunes and totally new entrant with disruptive technology like “Google” in entertainment. Bargaining power of suppliers: Two types of suppliers, for microprocessors and OS memory chips and disk drives and keyboards for the PC category, for example IBM, Intel and Motorola. Pricing and quality adjustment takes place in making Apple’s product more attractive by having a
When relating to the external factor which has a strategic implication for Apple’s future, it can be best described using Porter’s five forces.
Threat of new entrants
Threat of substitutes
Bargaining power of suppliers
Bargaining power of customers
Intense competitors at current state
Porter’s Five Forces Current rivalry: Apple faces an intense and fierce competition in the PC market, which has a very low switching cost. Competition comes from IBM, Dell, HP and Toshiba. In the multimedia solutions category, initial companies such as Napster and Kazaa was the main rivals to Apple’s iTunes and iPod but due to illegal piracy and legal issues, it dies of leaving Apple as the leader in this category till present. For Apple TV, it faces stiff competition from Amazon Unbox, CinemaNow, HP, Disney, Movielink, Wall-Mart, Sony and many more. For iPhone, it is Motorola, Palm and Blackberry. When relating to the PC industry, price competition has become severe, so cost cutting is essential to cover decreasing profit margin. Dell has been able to apply this while others are suffering from negative growth rates. So it remains a challenge for Apple. Threat of new entrants:. Since existing companies like Apple have created strong brand name with products like iPod and iTunes, so it’s a difficult task for new entrants to make a name. Even so, there are possibilities of availability of streaming audios with v-cast (Verizon), on demand online downloads that functions similar to iTunes and totally new entrant with disruptive technology like “Google” in entertainment. Bargaining power of suppliers: Two types of suppliers, for microprocessors and OS memory chips and disk drives and keyboards for the PC category, for example IBM, Intel and Motorola. Pricing and quality adjustment takes place in making Apple’s product more attractive by having a