...Contents Porters 5 Forces Analysis………………………....……………………3 Entry………………………………………………………………3-4 Rivalry…………………………………………………………….4-5 Substitutes…………………………………………....…………….5 Supplier Power……………………………………………………5-6 Buyer power………………………………………………………..6 Competitive advantage………………………………………………..6-10 Identifying challenges…………………………………………...…..10-13 Reference…………………………………………..………………….14 5 Forces Analysis of the Video on Demand Industry By offering streaming movies through its website, Netflix is entering the Video on Demand (VOD) industry. This industry, along with DVD rentals (both from online providers such as Netflix, and cable services such as On Demand and Pay-Per-View), is part of the larger industry of “watching movies in the home.” However, since Netflix is already positioned in this market, with its online DVD rentals, we will examine the smaller 5 portion of the market that is streaming online movies. This business is too closely related to the movie downloading service to be considered as a separate market. Threat of Potential Entrants Today, internet video rental industry is very profitable and still has a very good develop prospect. After Netflix’s success, the whole video industry starts to change gradually, and more and more people start to consider entering this field. However, for most of those potential entrants, this industry has some big barriers to entry. First of all, the service in this industry is already very complete. With its seven-year-development...
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