1) Strength and weakness of VOD, Movielink & iTune
- There has emerged VOD(Video-on-demand) after Blocbuster&Netflix video-rental business industry. VOD is kind of mixture of video-rental service and telephone service. Through this system customers don’t need to move to a video-rental shop anymore. Only thing customers need to do is click a button and choose the movie that they want to see from the list.
Secondly, Web site Movielink is another factor which is intimidating preexistent market. So far, Movielink had offered movie-downloads as rentals, which, like the VOD model, the customer could watch for only 24hours. However, they improved this problem by offering download service. Therefore, customers can have movies exactly same as they buy them in the DVD store. But they have some problems like piracy issues, uncertainty of success(risk taking), technologic problems(hard to transport the download movies from computer to the TV screen). The more people download movies from Movielink the more the piracy will be prevalent. It will bring about patent problems. Since this is new trial of the business industry, there are lots of uncertainties to success. Movielink’s higher download fee than iTunes is another weekness and things to overcome to grow larger.
Lastly, it is not yet free from technologic aspect. To watch movies on a television screen, users would need to have Windows Media Center, which is designed to connect to a TV, or special jacks and cables. This technology has not come into wide use yet. Also, it requires customers to study and think to get used to it.
Another force that Blockbuster and Netflix have faced is the entrance of Apple into the movie download market. As we know, Apple’s iTunes is already a huge unchallenged company, so just its coming to the business could be a heavy burden to them. On the other hand, there are some problems they are having. First, it’s time consuming to download movies via that service. Because, even using a broadband Internet connection, high-quality movie files, which generally surpassed 1 gigabyte in file size, required in the neighborhood of 90minutes to download completely.
Moreover, it takes certain time to make customers to adapt to the new technology. Also, they should spend some time to learn how to use the system. In brief, it’s more complicated than just buy DVDs and watch it. Lastly, many piracies will be prevalent. Then, naturally it will cause downwardness of Movie industry.
2) Its effect in the future to Blockbuster&Netflix Market
- I don’t think nor Blockbuster and Netflix will keep there market share in the future unless they innovate present system and organization. Because, as time flows lots of new entrants will be coming into this industry with better contents. Since science and technology are developing fast these days, position of the bricks and mortal industry like Blockbuster is getting smaller and they are now facing crisis. To survive in this tough, competitive environment, Blockbuster and Netflix should innovate on their present structures and ideas to catch up changing trends.
3) Different point of view: Would the Netflix model work in Korea? Why or why not?
- It will be little bit tough for Netflix to succeed in Korea. Because, most of environments and circumstances are different between US and Korea.
Firstly, Korean technology has developed so well, so there are many ways to download movies and even dramas at low cost. For example, Korean internet site ‘we-disk’ offers 10MB/1Won download service. Also it helps us to download a movie within 5minutes. It’s really convenient and time-saving. Therefore there is no room for Netflix to come into Korea market.
Secondly, Korea online DVD&Video rental industry is already fixed firmly. It’s already full like Cashcow of BCG Matrix. Therefore we don’t need to use foreign company.
Thirdly, it’s really easy to access offline store. If we leave home, we can reach DVD&Vedio rental store just by few steps. We don’t want to spend our time and labor searching on the internet to rent DVDs via online.
Reference:
Management Information System -Pearson Education- P121-123
student NO. 20601016 entry-5
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