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Every player in the movie industry has been labeled to be strong, medium, or weak. The strong forces are perceived to be threats to the firm due to the influences therefore restrain the company’s ability to raise prices. In contrast, the weak actors are viewed as opportunities. They have insignificant bargaining power so that the firm could increase price or lower cost to preserve the surplus that the company brings in.

A.

1) Potential new entrants (Threat of new Entrants): High

2) Threat of Substitutes: Low

3) Rivalry among competitors: High

4) Suppliers (Supplier Power): Low

5) Buyers (Buyer Power): Strong

B. Five forces of framework

C.

Threat of Substitutes: Medium. It is well known that it costs less to rent or stream a movie than to buy a DVD. Also, the consumers can easily opt to switch from one substitute to another because of this latitude, which makes it very appealing. The obligation to return a movie or compile stock of DVDs after having purchased them is almost obsolete. In addition, consumers realize that the choice of purchasing a DVD is more costly than renting or streaming therefore the absence of disposable income has pushed them in that direction in lieu of buying them.

Buyer Power: Medium to High. The reason why consumers have shifted from buying DVDs to renting or streaming is due to the reasonably low price tags which empower them to decide whether a particular brand or distributor would match their pockets. However, it all boils down to price, availability and accessibility.

Supplier Power: Low to Medium. There is a direct interdependency existing between the suppliers and the rental industry. However, the suppliers cannot influence nor intimidate the other party because they need them ...

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...ore about how much they spend and how different you are from the competition. Here is a summary of my recommendations: although the consumers really enjoy the unlimited streaming for a monthly fee but the price is still too high and should be cut down to $2.99. Therefore, consumers would think before they take the next trip to the rental kiosk for their movies. The new slogan would be “Supersize your movie rental” for a buck extra the competition, you can watch unlimited movies in your own pajamas. Also, we should offer the new releases before our competitors even get them. Finally, we should expand to the hotel industry by offering our services there in the comfort of your own hotel room. I believe the name already speaks volume and all we need to do is to win their pockets by implementing the above recommendations. I hope to hear from you soon. Have a blessed day!