Develop a Porter’s Five Forces analysis of the home video game industry. Focus in particular on the strength of complements, substitutes, and the power of suppliers. What is your overall conclusion regarding the intensity of rivalry in this industry?

To MGMT 425 Student : Please read the following instructions:

2. There are 4 questions worth a total of 5 points. Please answer all of the questions.

We will examine the case “Home Video Game Industry”, from the back of the

textbook, as an illustration of industry and product life cycles and business level strategy

both as a response to competitive dynamics as well as internal analysis. You could use

roughly one page per question. You can use up to 2 additional pages for any exhibits,

pictures, flow-charts, or tables justifying your analysis and discussion.

Question 1

Develop a Porter’s Five Forces analysis of the home video game industry. Focus in

particular on the strength of complements, substitutes, and the power of suppliers. What

is your overall conclusion regarding the intensity of rivalry in this industry? Is the

industry, especially at the hardware or console level concentrated or more diluted? Justify

your conclusions.

Question 2

What drove Microsoft’s decision to enter the industry with its X-box offering? What

were some risks for Microsoft as it entered the gaming industry, especially in the light of

your Porter’s Five forces analysis? What particular business level strategies did Microsoft

deploy in order to overcome some of the barriers for entry and handle the competitive

pressures? You can refer to sources outside of the case and cite them as you respond to

this question.

Question 3

What are some strengths and weaknesses of the key players in the game console industry.

Focus your attention on the big 3: Sony, Microsoft, and Nintendo. What are some

functional strategies that are unique to each player? Again feel free to bring in outside

sources of information but cite all sources liberally.

Question 4

Finally, comment on why product life cycles are on the longer side in the game console

industry. Why is the average time between product introductions longer than say the

desktop or laptop or tablet or smartphone industries?