Five Forces Analysis Report: Warner Brothers Entertainment Industry

This report presents a Five Forces analysis of Warner Brothers, a major player in the entertainment and mass media industry. The analysis examines the competitive intensity within the industry, focusing on factors such as the threat of new entrants, the threat of substitute products or services, the bargaining power of customers and suppliers, and industry rivalry. The report highlights the high initial costs as a barrier to entry, the impact of substitute products, and the influence of customers. It also discusses the dependence on suppliers and the intense rivalry among major companies like Walt Disney and Paramount. The report emphasizes the ethical considerations within the industry and Warner Brothers' efforts to promote its business ethically. The key stakeholders, including customers, shareholders, suppliers, and competitors, are identified. The analysis provides a comprehensive understanding of the competitive forces shaping Warner Brothers' strategy and profitability.

Five Forces Analysis of
Warner Brothers
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Five forces analysis
 The competition of a business can be analyzed with the help of Porter’s five
forces framework.
 The competitive intensity determined by the by the five forces analysis, helps
to understand the profitability of the industry.
 One of the largest diversified multinational entertainment and mass media
conglomerate is Warner Brothers (WarnerBros.com, 2020).
 The competitive intensity of the industry from which Warner Brothers belongs
will be examined on the basis of five forces analysis.
The five forces that governs the competition of the entertainment and mass
media industry include threat of new entrants, threat of substitute products or
services, bargaining power of customers, bargaining power of suppliers and
industry rivalry.

Five forces analysis
 One of the major barriers to entry of the entertainment and mass
media is high levels of initial cost.
 To overcome the customer loyalty, new entrants need to spend
heavily. Thus, it creates one of the major barriers to entry for them.
 Presently the companies in the field of social networking also poses
threat for the company due to the substitute products
(WarnerBros.com, 2020).
Therefore, presence of substitutes limits the level of profit by sharing
the market.
As there involve no switching cost for the customers to buy any other
substitute products, it creates problem for the Warner Brothers

Five forces analysis
 The undifferentiated or standard product of any firm also increases the
influence of the customers.
 The domination of the suppliers are high in industry where few firms
operates and the market is highly concentrated. Hence, the performance
of the Warner Brothers highly dependent on these suppliers (Hbr.org,
1979).
The big companies of the entertainment industry include the Walt Disney
Studio, Fox Filmed Industries, Paramount Pictures Corporation and others.
As the rivalry induces, it degrade the profitability of the Warner Brothers.
Moreover, the presence of the expansion-minded members in a slow
growth industry intensify the fights for the market share.

Five forces analysis
 The entertainment and mass media industry comes under the ethical
and moral scrutiny.
 In order to grab major market share through more sales, the firms
under this industry sometimes adopt unethical means, which should be
avoided.
 Warner Brothers adopted means including the rating system and
Entertainment Software Review Board (ESRB) to promote its business
through ethical means.
The key stakeholders of the company include customers, shareholders,
suppliers and competitors. The shareholders are essential part of the
Warner Brothers, as they provide the financial backing (Hbr.org,1979).

References
• Hbr.org (1979). How Competitive Forces Shape
Strategy. Harvard Business Review.
https://hbr.org/1979/03/how-competitive-forces-shape-
strategy
• WarnerBros.com (2020). | Home of WB Movies, TV, Games,
and more!. Warnerbros.com. https://www.warnerbros.com/