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The News Case Study
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| Words: 2537 | Submitted: 17-Mar-2012
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The News Corporation Case Study
1. Section 1 (600 words) 2
a. Identifying BSkyBís generic Strategy Ė differentiation on multiple bases 2
b. Sustaining Competitive Advantage by differentiation 4
2. Section 2 6
2A: Rationale behind TNCís diversification strategy 6
2B: Value-adding and corporate role of News Corp 9
Works Cited 11
Identifying BSkyBís generic Strategy Ė differentiation on multiple bases
The News Corporation (TNC) originated in Australia as a newspaper company buy then diversified into various related businesses of Television, non-newspaper publishing, Satellite broadcasting and movie making. Below are some of TNCís businesses listed in the Ansoff matrix for strategic direction.
BSkyB have diversified from their initial core business of satellite broadcasting into offering a variety of products (Sky TV, Sky Broadband, Sky Talk) that have come to give them a competitive advantage. It is beneficial to explore the strategies, strategic customers and critical success factors for each product in order to understand how competitive advantage has been achieved.
Looking at Sky TV, we can identify a number of strategies used. Since securing exclusive rights to broadcast the English Premiership Football matches in the UK since 1992, sports broadcast has been at the heart of Sky TVís success going on to secure exclusive Cricket, American Football and Boxing rights. In addition to their Sky sports package, BSkyB have been able to charge a premium for their movie channel subscription too. This can be identified as a focused differentiation strategy as they were catering for a niche group, which happened to be sports enthusiasts and lovers of American movies.
Agreeably, Sky Sports and Sky Movies was responsible for the success of BSkyB and warranted focused differentiation strategy due to the exclusivity of both, they were able to gain a larger market share by strategically offering a different package to customers who were either unable to afford a premium price or were not interested in the premium sports and movie packages.
Figure 2 - Multiple bases of differentiation
BskyBís acquisition of Easynet in 2006 (KOLLEWE, Julia, 2005) saw them enter telephony provision market competing with companies like BT (with their TV product BT Vision and Telephony service BT broadband and phone lines) and Virgin Mediaís Quadruple play (Virgin mobile, Virgin.net NTL, and Telewest). Their Sky Talk (Telephone service) and Sky Broadband (Internet service provision) are seen as affordable products when bundled with their Sky TV subscription. As stand-alone products these communications services are not fore-runners in the industry as Virgin Media dominates for differentiated product with the fastest download speeds in the UK for the past three years (BROADBAND CHOICE, 2010).
Sustaining Competitive Advantage by differentiation
BskyBís success can mainly be attributed to their ability to differentiate their products to gain market share and consistently remain as frontline players. ...
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