Competitive Analysis Of The Movie Industry

1. What competitive forces have challenged the movie industry? What problems have these forces created? What changes have these problems caused the movie and television industry to make?

The two major competitive forces that have challenged the movie industry are new market entrants and substitute products and services offered. The new market entrants such as online movie websites (CinemaNow, MovieLink, Youtube, etc.) have challenged the way movies were originally viewed on televisions, in theatres and through movie rental. These new market entrants are also beginning to use substitute services, such as providing movies online by enabling customers to download rentals and utilize video-on-demand services in the comfort of their own home, 24

In this case the use of physical CDs, which had previously been the ideal method for movie companies to distribute their content had started to see a decline in sales. This was due to the advancement of technologies, specifically the internet, PCs, portable video devices, and file sharing servers allowing for potential consumers to easily access the content digitally. Unfortunately for these video companies, the amount of illegal content obtained compared to legal was 4 to 1. This severely impacted their current marketing practices and forced these companies to adapt to the technological advances to stay relevant in the evolving market. Companies that failed to adapt were simply out of business and no longer relevant. In this case, the company Blockbuster, which was known as the leading distributor for movies, became irrelevant due to the impacts. Instead the company Netflix had become the replacement and is taking full advantage of the disruptive

Many people are impacted when material is pirated because companies make less money when people essentially steal their products. When companies make less money, they cannot afford to pay their employees as much – or even continue paying people at all. This causes people to have a difficult time finding paid work in the entertainment industry – especially artists, who suffer directly as people rob them of their profits by uploading and downloading their content without paying for it. In order to protect people in the industry, the penalty for pirating any material should be much higher. Although Canada has tough laws regarding piracy (when compared with the rest of the world), the maximum $20000 fine for copyright infringement (Shaw, 2015) should be higher in order deter more people from entering the piracy business. Downloading the illegal content should also have more serious ramifications to decrease the demand for pirated