Porter Five Force Model of NZTV Channel Company

This article discusses the Porter Five Force Model of NZTV Channel Company and explores ICT solutions to convert negative forces to positive forces. It analyzes the threat of new entrants, bargaining power of suppliers, bargaining power of buyers, threat of substitutes, and competitive rivalry in the NZTV industry.

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PORTER FIVE FORCE MODEL OF NZTV CHANNEL COMPANY
There are five dimensions which can be defined as threat of new entrants, bargaining power of
suppliers, bargaining power of buyers, threat of substitutes and rivalries.
(Source: research, methodology, 2019).
 Threat of new entrants – LOW
It can be observed that the NZTV channel company has a major threat in relation to brand
identity. The channels emphasizes on bringing innovation which put pressure on the companies
to consider the low pricing strategy. But on the other hand, it can be said that threat of new
entrants is low as huge investment is needed to cover the high fixed costs. According to the
present scenario in the NZTV industry, the new companies will not be able to survive in the
market as the industry is saturated with the different channels and also there are many barriers to
entry. There are many competitors in the market such as Channel 9, channel 61 and C4 New
Zealand (Beal, Kang & Beal, 2016).
Positive
This force can be positive as there is a wide scope for the existing channels to boost their
customer base in the existing market.
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 Suppliers bargaining power (High)
In relation to the NZTV channel company, it can be stated that the suppliers provide the input
required for production of the shows such as anchors, artist and directors. The supplier power is
high as the market is dominated by the few suppliers rather than fragmented source of the
supply. Also, there are many channels but there are only few suppliers, so it can be stated that the
bargaining power of the supplier is high (Baker, 2017).
Negative
It could be negative as the suppliers are less which enhances the overall cost of the companies to
purchase the inputs at the time of production.
 Bargaining power of the buyers (High)
The bargaining power in context to NZTV industry is high as there are many potential and actual
buyers. With the increase of different channels, it can be said that the customer bargaining power
is also enhancing as the customers have more choice to select from different channels (Cocker,
2018).
Negative
It can affect the entire sales of the company in the highly competitive market.
 Competitive rivalry (High)
The competition level is high in reference to the NZTV channels. It has been seen that there are
many TV channels who are managing their activities in the New Zealand market. The companies
that are present in the market are Channel 61, Channel 9, C4 New Zealand and CUE TV
(Menzies, 2018).
Negative
It could be negative as the customer base is divided among the different channel companies. It
can negatively impact the demand of the services in the market.
 Substitution of the services (high)
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The NZTV channels are offering the services that can be substituted by the customers easily.
There are many TV operators who are offering similar services in the market. Also, there are
internet services that are offered which are cutting the demand of the services (Given, 2016).
Negative
It can be negative as the customers have the choice to substitute the services easily which affect
the demand of services offered in the market.
ICT SOLUTIONS TO APPLY TO NEGATIVE FORCES TO POSITIVE FORCES
The broadcasting industry in New Zealand emphasizes on ICT’S by offering the services to the
customers through their digital cables. With the help of ICT’s the companies are able to maintain
their market share in the competitive market. In the present scenario, the television in
Low cost of services
It can be observed that the concept of ICT is considered by the NZTV channel company. ICT has
impacted the industry competitors by maintaining cost effectiveness and also it is easy for the
companies to access the market. But to compete in the market it is important for the NZTV
channel company to focus on reducing the prices of the services offered to the customers so that
it could be easy to attain growth in the competitive market. The NZTV channel company should
maintain its competitive advantage by positioning its brand through ICT in the market. This will
help to resolve the negative impact related to satisfaction level of the customers. It will help to
boost the satisfaction level of the customers towards the services offered by the company
(Acharya, 2019).
Use of latest technologies
The digital broadcasting has been considered by the broadcasting sector. To enhance the growth,
it is important for the broadcasting companies to focus on offering the services of digital video
recorder so that it could be easy for the viewers to record and view the channels (Kelsey, 2015).
In the present scenario, the broadcasting sector should emphasize introducing the feature of
recording a live program. Such as the TV gateway interfaces the DVB tuners and should offer
the TV server to record and live the programs that are showcased on the television channels. This
is one of the best solutions that should be considered by the companies as it will help in
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maintaining the competitive advantage in the market. It will also reduce the negative impact
related to decreasing the demand of the services. By considering this service, it would be easy for
the companies to boost their market share in the competitive market (Díaz Andrade & Doolin,
2019).
Partnership or collaboration
With the use of ICT’s the channel technology companies should focus on partnership that will
help their customers to attain the higher investments. By collaborating with the different
companies it would be easy for the company to maintain its demand in the market in reference to
the competition level. If the companies come into partnership then it would be easy to minimize
the competition level prevailing in the market (Myllylahti, 2017). Therefore, it can be stated that
in this way, the broadcasting industries can consider as a solutions to convert the negative forces
towards the positive forces. This will also help to attain growth in the highly competitive market
by emphasizing on boosting the customer service.
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References
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programmes. The Political Economy of Communication, 5(2), 86-88.
Beal, T., Kang, Y., & Beal. (2016). China, New Zealand, and the Complexities of Globalization.
Palgrave Macmillan.
Cocker, A. (2018). New Zealand: A Deregulated Broadcasting Model?. In Transparency and
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Díaz Andrade, A., & Doolin, B. (2019). Temporal enactment of resettled refugees' ICT‐mediated
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Given, J. (2016). “There Will Still Be Television but I Don’t Know What It Will Be Called!”:
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Kelsey, J. (2015). The New Zealand experiment: A world model for structural adjustment?.
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Menzies, M. (2018). A Partial History of Futures Thinking in New Zealand. Policy
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Myllylahti, M. (2017). The Rise of Tactical Partnerships: Media Converging Beyond
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methodology.net/porters-five-forces-analysis/.
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