SWOT analysis of transition into online streaming (in 2007)
Strengths Weaknesses
• Brand Recognition
• Accessibility • Content Contracts
• Initial Cost
Opportunities Threats
• International Expansion
• Original content Creation • Content Price
• Service Providers
Strengths
Brand awareness
• Netflix was already a known brand by 2007; they had just rented their billionth DVD and had a solid customer base.
Accessibility
• Introducing a service available on the internet would allow anyone with an internet connection to easily access their service
Weaknesses
Content Contracts
• By having an online service where people could watch movies Netflix would be forcing itself to require studios to have contracts with them so that they would allow Netflix to stream their movies. This is a weakness since the contracts would eventually expire which would lead to Netflix having to …show more content…
This is great for Netflix since it is a cheap way of reaching even more customers.
Original content creation
• Since Netflix would have their own service to stream media they would be able to invest in their own original content. This might be valuable for them since they would not need to have contracts with studios. This would also mean that by having original content Netflix would be the only place to watch it, which could attract more customers to subscribe to their service.
Threats
Content Prices
• As a result of having to renegotiate shows and movie contracts after they expire Netflix put itself at a great risk since without the contracts their service would become worse as customers would have less variety of media to which to choose to watch. Studios can take advantage of this and raise their prices that would affect Netflix ability to operate at a profit.
Internet Service
Strengths Weaknesses
• Brand Recognition
• Accessibility • Content Contracts
• Initial Cost
Opportunities Threats
• International Expansion
• Original content Creation • Content Price
• Service Providers
Strengths
Brand awareness
• Netflix was already a known brand by 2007; they had just rented their billionth DVD and had a solid customer base.
Accessibility
• Introducing a service available on the internet would allow anyone with an internet connection to easily access their service
Weaknesses
Content Contracts
• By having an online service where people could watch movies Netflix would be forcing itself to require studios to have contracts with them so that they would allow Netflix to stream their movies. This is a weakness since the contracts would eventually expire which would lead to Netflix having to …show more content…
This is great for Netflix since it is a cheap way of reaching even more customers.
Original content creation
• Since Netflix would have their own service to stream media they would be able to invest in their own original content. This might be valuable for them since they would not need to have contracts with studios. This would also mean that by having original content Netflix would be the only place to watch it, which could attract more customers to subscribe to their service.
Threats
Content Prices
• As a result of having to renegotiate shows and movie contracts after they expire Netflix put itself at a great risk since without the contracts their service would become worse as customers would have less variety of media to which to choose to watch. Studios can take advantage of this and raise their prices that would affect Netflix ability to operate at a profit.
Internet Service