The specific course learning outcomes associated with this assignment are:

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Running head: EXAMINING NETFLIX COMPANY

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EXAMINING NETFLIX COMPANY

EXAMINING NETFLIX COMPANY

Angela Solorzano

Strayer University

BUS499 Business Administration Capstone

Dr. Grizzell

Dr. Gardner

November 05, 2019

Examining Netflix Company

Netflix Inc. is an American Production and Media-services provider that is headquartered in Los Gatos, California. This Company was founded back in the year 1997 by Marc Randolph and Reed Hastings in California. The primary business for this Company is subscription-based hence offering online streaming of television and film programs inclusive of the house productions. This paper will examine the industry in which Netflix operates and analyze it in-depth.

Netflix's greatest strength and weakness

One main strength Netflix Inc has is its exponential growth. In the past ten years, Netflix has been an influential brand and known as a household name. It has been streaming online content not only in the United States but also across the globe. This is one competitive edge, and it should be used as leverage to increase revenue for the Company. To do this extensively, Netflix should ensure quality in its services in all the 190 countries it is serving hence increase the customer base. It can also be diverse to the other untouched nations, thus known by many.

A weak point for Netflix is the growing operational costs. This Company gets a competitive advantage from its production of original content, but the sad part is the cost used to support the material since it keeps growing. In an example, in June 2018, original programming by the Economist was counted to be $12 billion (Federal Trade Commission, 2016). This amount seems to have exceeded the previous year's spending. To counter this issue, Netflix can partner with other streaming companies hence strengthen its financial constraints and continue giving its services all over the world at ease.

The partnership can be based on offering a certain percentage to a partner and contract of Company whereby Netflix can choose to continue with an organization or buy out the partner in case of stabilizing.

Netflix's intangible and tangible resources, core competencies and core capabilities

Netflix has both tangible and intangible assets whereby the tangible can be seen and felt while the intangible is not physically observable but belong to the Company. Below is the list of the tangible assets for Netflix (all in thousands)

· Cash and its equivalents amounting to $1,113,608

· Current content Library amounting to $2,125,703

· Technology and information assets amount to $189,275

· Equipment and Company's property is estimated to amount to $149,875

Below is the list of the intangible resources for Netflix Incorporation (in thousands):

· Technology and development assets worth $473,321

· Non-current library content estimated at $2,7723,225

· Total of the streaming obligations of the content is $9,541,115

Netflix's core competence is offering quality and original content. Netflix ensures that its customers all over the globe can easily access to the television and movie contents (Federal Trade Commission, 2016). Notably, the core capability of Netflix is delivering the content conveniently, instant streaming with no late or return fees for streaming and renting.

Choose the two (2) segments of the general circumstances that would rank highest in their impact on the organization you chose. Estimate how these segments affect the partnership you chose and the industry in which it operates.

One of the most popular Companies in the streaming movie and television content as of now is Netflix, which has taken waves in the recent past. For this fact, one of the global environment segment ranking high in its influence on Netflix is the legal aspect. This is because they govern the relationship between Netflix and its customers, partners, employees, and investors. In this segmentation of the global environment, there are laws and legality issues that a company faces in its everyday business. Assuming Netflix deals with online customers as its primary consumers of streamed content, issues crucial here are the anti-trust law, the taxation laws, deregulation, education policies, and labor laws, among others (Federal Trade Commission, 2016). Relating to this, the anti-trust regulations are set forth to safeguard the consumers and the general public from business exploiting and other malpractices. A clear example of the anti-trust law is the Sherman Act of 1890, which states that a charter for economic liberty ought to preserve unfettered and free competition being the rule of trading.

Another general segmentation ranked highly by Netflix is technological. This one holds much influence in the online dealings. The core elements of technology are knowledge application, focusing on government research and development support, product innovation, and new technologies for communications. Here, an essential aspect is service and product innovation. The reason behind this stance is the ability of an entity to come up with new products hence maintaining an edge over other business rivals (Federal Trade Commission, 2016). Thus, Netflix is always ahead of other streaming companies courtesy of its innovative spirit in the industry.

Choose two (2) forces of competition that you estimate are the most significant for the corporation you chose. Evaluate how well the Company has addressed these) forces in the recent past, going back no further than five (5) fiscal years.

The five forces of competition are; Supplier's bargaining power, the bargaining power of the buyers, threats of substitute products and services, rivalry among the business competitors, and threats coming from new entrants. Rivalry among the competitors is one of the significant forces for Netflix, with an example of Amazon Prime and Hulu taking lots of subscribers courtesy of their strategies. Hulu is available in Japan and the US only with over 28million subscribers. To counter the alarming competition, Netflix spent about $9billion in the year 2017 alone, with the figures rising to $12 billion in the year 2018. This comes as Netflix strategized to spend on content going forward. The investment is yielding positive results with Netflix currently ranked as best among premium TV services.

The next force of competition is threats of substitutes, whereby there have been many TV and movie streaming companies in the recent past with more excellent services compared to Netflix. Netflix has come up with programs that attract viewers. An example is in India, where Netflix's Sacred Games that has been positively received with a broad audience. India is among countries with Netflix subscriptions hence working positively for the Company and audience.

With the same two (2) forces in mind, predict what the Company might do to improve its ability to address these forces soon.

Threats of substitutes and rivalry by the competitors can all be countered by quickly having Netflix partner with a more prominent company like Amazon (Federal Trade Commission, 2016). Partnership here will work in favor of Netflix since it is considered the world's largest provider of online movie and television programs streamlining. Its issue of finance will be catered for after partnership hence diversifying more to the untouched regions of the world.

Identify what you consider to be the most significant external threat to this corporation. Discuss how the corporation should address this threat. Justify your explanation.

The financial constraints are a big issue for Netflix, and as it seems, the Company might go bankrupt soon. It needs quick fixing, which can be done by asking for help through partnering with already established companies like Amazon or Google Inc. A partnership deal can help the Company steer itself and strengthen its services in regions outside the United States hence conquering the world of streaming movies and television programs (Federal Trade Commission, 2016).

Identify what you consider to be the most significant opportunity presented to the corporation and discuss how the corporation should take advantage of this opportunity. Justify your explanation

An excellent opportunity for this Company is its brand name. Netflix has a good reputation across the globe, and it can use it to leverage itself and earn revenue. Netflix can have other television program franchise the name and use in their advertising (AMELIA MOORE, 2019). Here, the agreement can be done on aspects like asking for a particular percentage share after franchising under its name and goodwill.

References

Federal Trade Commission (2016). Guide to Antitrust laws/The Antitrust Laws. Washington, D.C. Retrieved from https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/antitrust-laws

Hitt, Michael A., R. Ireland, Robert Hoskisson. Strategic Management: Concepts and Cases: Competitiveness and Globalization, 10e, 10th Edition. Cengage Learning, 01/2012. VitalSource Bookshelf Online. Retrieved from the course text.

AMELIA MOORE., (2019). Netflix’s Generic Strategy, Business Model & Intensive Growth Strategies. Retrieved from https://www.rancord.org/netflix-business-model-generic-strategy-intensive-growth-strategies-competitive-advantage http://www.forbes.com/sites/amitchowdhry/2014/08/06/apple-and-samsung-drop-patent-disputes-against-each-other-outside-of-the-u-s/#43c3119da5e1