Netflix Analysis

Running Head: NETFLIX ANALYSIS 1
NETFLIX ANALYSIS

Running Head: NETFLIX ANALYSIS
Table of Contents
Pestle Analysis............................................................................................................................................3
Porter’s five forces......................................................................................................................................5
Threat of New Entrants............................................................................................................................5
Bargaining power of buyers.....................................................................................................................6
Bargaining power of Suppliers................................................................................................................6
Threats of Substitute Products or Services...............................................................................................7
Rivalry among the Existing Competitors.................................................................................................7
Opportunities...........................................................................................................................................8
Threats.....................................................................................................................................................9
Strategic Position of the Organization.........................................................................................................9
Success/failure of Netflix’s current strategies............................................................................................11
Success Strategy....................................................................................................................................11
Failure strategy......................................................................................................................................12
Future Strategies for Netflix......................................................................................................................13
SBU.......................................................................................................................................................13
Corporate:..............................................................................................................................................13
Feasibility of the strategies........................................................................................................................14
Winning strategy and Key issues in implementation.................................................................................15
Conclusion.................................................................................................................................................16
References.................................................................................................................................................17

Running Head: NETFLIX ANALYSIS
Pestle Analysis
Basis Analysis
Political In US markets, the number of audiences bounces away from
traditional television in order to have the experience of on-
demand streaming services like Netflix. Since the pace with
which Netflix grew tends to be amazing yet the US telecom giants
AT&T complained to the Federal communications for keeping a
strict supervision on the usage of the net. The most threatening
issue over here if the rule is passed through the congress the price
of the net would rise and the business model of Netflix will suffer
a huge loss1.
Economical The most important feature of the Netflix is they have currently
100 million subscribers and the customers who are enjoying the
services globally. The crucial factor over here is the prices of the
competitive nature against the conventional television services. In
the era of the global recession where the purchasing power of the
customer is low the Netflix is the real solution.
The key issue that affects the performance of the Netflix is also
because of the exchange rates. The company aims at dividing the
prices around US$10 fee, where as in many markets this can be as
1 Aversa, Paolo, and Stefan Haefliger. Business model portfolio diversification. working paper,
Cass Business School, London, 2017

Running Head: NETFLIX ANALYSIS
high as $19 due the changes in the currency levels or the changes
in the rate of VAT.
Social The traditional large screens have been set aback and the portable
screens are much in trend. Hence the customers are enjoying the
video content more on their smartphones or tablets rather than
TV. In the year 2015, according to a survey the US viewers
watched 24 minutes on an average on smartphones2.
Cord cutting has again become one of the most giant act for
facilitating with the services to the consumer to get away with the
conventional media or the streaming services. This in turn made
the customers grab for the non-cable options and to view the same
content was an influential move from Netflix side.
Technological Within the labs of the Netflix strong efforts are in making for the
patented technology as the technological shift to 4k screen is
creating a barrier for the streaming services. For the smooth
compression of the signals the company is aiming at 4K signal, if
the technology gets implemented the huge advantage will be on
the part of the Netflix. It is necessary be driven by technology
2 Babones, Salvatore. "Netflix & Amazon battle for a piece of India’s 500M smartphone
audience, but which strategy will pay off?." (2018).