News Corporation

The News Corporation

Executive summary

The present paper analyses the current environmental and industry factors of the TNC, one of the leading companies in the global media business. This analysis produces the holistic view of the macro factors that affect the industry players and the company. Basing on the industry and business environment analysis the paper reviews current opportunities and threats, strengths and weaknesses.

The paper reviews the competitive environment and the way the company develops and maintains its competitive advantage. Besides it identifies the key stakeholders and proposes future directions for strategic development.

The analysis of historic strategic directions of BSkyB is introduced.

The analysis identifies such opportunities to improve financial health, capitalize on the growth of advertising market and develop further differentiation. At the same time economic conditions and debt finance were distinguished as serious threats to the company.

The business strategy analysis identified that company is competitive due to its diversified portfolio, creative organizational culture, and the experience of running the international operations. At the same time the current expansion strategy and current capital of capital were defined as major weaknesses.

For future strategic direction, the paper suggests the development of cost-reduction activities, introduction of new ICT technologies and superior market segmentation.

The development of major strategic developments of BSkyB identified that high debt finance and new product diffusion process seriously threatened to the overall survival of the company.

INTRODUCTION 3

GLOBAL MEDIA INDUSTRY 3

POLITICAL FACTORS 4

ECONOMIC FACTORS 4

SOCIAL FACTORS 4

TECHNOLOGICAL FACTORS 5

OPPORTUNITIES 5

Improvement of financial health 5

Advertising Growth 5

Differentiation 5

THREATS 6

Economic conditions 6

Debt 6

PORTER’S FIVE FORCES MODEL 6

NEW ENTRANTS 7

BUYERS 7

SUBSTITUTES 7

SUPPLIERS 7

COMPETITORS 7

THE ANALYSIS OF STRATEGIC CAPABILITY 8

STRENGTHS 8

WEAKNESSES 9

STAKEHOLDERS 10

SHAREHOLDERS 10

EMPLOYEES 10

CONSUMERS 11

INVESTORS 11

FUTURE STRATEGIC OBJECTIVES 11

COST-REDUCTION ACTIVITIES 11

THE FURTHER INTRODUCTION OF ICT TECHNOLOGIES 11

SUPERIOR MARKET SEGMENTATION 12

GENERIC STRATEGY 13

COST LEADERSHIP 13

DIFFERENTIATION 13

FOCUS 14

THE MAJOR STRATEGIC DEVELOPMENTS OF BSKYB AND SFA ANALYSIS 14

THE DEVELOPMENT OF SKY TV MARKET 14

THE FOCUS ON THE QUALITY OF CONTENT AND THE INTRODUCTION OF NEW TECHNOLOGIES 14

THE CONTINUOUS EXPANSION 15

CONCLUSION 16

REFERENCES 17

APPENDIX I - SLEPT ANALYSIS 18

APPENDIX II вЂ" PORTFOLIO VS CORE COMPETENCE PERSPECTIVES 19

INTRODUCTION

News Corporation is a developer, producer and worldwide distributor of feature films and television programs, television broadcasting and cable network programming. The current challenges in the market create certain challenges for future success of the operations.

The presents analysis starts with the discussion of current environmental and industry factors. This analysis produces the holistic view of the macro factors that affect the industry players and the company. Basing on the environmental analysis the paper reviews current opportunities and threats.

The second step comes to the analysis of the business environment competitive environment and the way the company develops and maintains its competitive advantage. This analysis creates a picture of internal capabilities of the companies. Basing on the evaluation of external and internal factors the analysis of strengths and weaknesses is delivered. It creates a framework for devising possible strategic intent of the company and identifies possible vulnerable points that can affect the feasibility of the strategy.

The key stakeholders and their expectation are discussed, as well as recommendations for the company’s further strategy.

The paper also reviews the development of BSkyB. It reviews major strategic direction and whereas SFA (suitability, feasibility and accessibility) analysis outlines the way the suggested methods correspond with the macro and micro factors of the company.

GLOBAL MEDIA INDUSTRY

According to Grant (1998), in order to identify the key success factors and the company’s opportunities and threats it is important to study environmental factors that effect the firm’s strategy on the industrial level. To do this, SLEPT analytical tool is applied (see summary in Appendix I).

Political factors

Political and legal factors play the role on the development of the industry. These factors shape the rules of competition, operational costs (minimum wage, safety requirements and consumer law) and the presence of various lobby groups. The last factor becomes very acute in the face of future accession into the EU of ten East European countries which are famous for the strong presence of