Strategic Management Assignment Example | Topics and Well Written Essays - 1750 words

Strategic Management - Assignment Example Few major markets where it operates are the US, the UK, Australia, Asia, Europe and New Guinea. Recently, the company added more than 36 additional channels in Europe, Latin America and Asia. Consequently, the profit was also recorded to be on rise continuously. Notably, in Italy they have gained popularity by the introduction of ‘Sky Italia’. ‘Sky Italia’ offers digital video recorder, which allows customer to store their favourite movies and television programmes in HD quality. For this reason people are ready to pay for ‘Sky Italia’ (News Corporation, 2009). Broadcasting Business of TNC News Corporation’s television business mainly includes ‘My Network TV’, FOX Entertainment and 27 TV stations. Their revenue comes mainly from advertisements of different sponsors of TV shows. Their main competitors are other TV stations and Cable Programme Networks, which compete for various TV shows, revenues from advertising and that of a udiences. Around 15 percent to 18 percent of News Corporation’s total revenue comes from their television business. In the year 2009, their income from television business exceeded 4.6 billion Dollars. There was a decrease by 21% from the revenue generated in the fiscal year 2008 which amounted 1205 million Dollars. One of the reasons for this decline can be stated as the selling of few television stations in the year 2008. The revenues from advertisement also decreased because of weak market conditions (News Corporation, 2009). In the year 2010 News Corporation’s operating income saw an increase by 37% in comparison to 2009. It was recorded at $2.3 billion. All of their significant networks showed notable growth. Their revenues also increased by 8 percent in the year 2010. The revenue in 2010 was $32.8 billion Dollars and the net income was recorded at $2.5 billion Dollars (News Corporation, 2010). The Satellite Broadcasting Television section of News Corporation cons ists of ‘Sky Italia’. It provides television and broadband services via satellite directly to home. The audio & video quality, interactive programming and better service quality are the major factors of gaining a larger market share in the respective segment. Around 11 percent to 12 percent of the company’s revenue comes from this segment. For instance, in the year 2009 the revenues of ‘Sky Italia’ had increased by 11 million USD. Their number of subscribers also increased to 4.8 million in 2009 compared to 4.4 million in 2008. Consequently, their main competitors are the companies which provide high quality graphics and sound, good entertainment, various broadband internets and DTT (Direct to Home) services to the targeted market (News Corporation, 2009). Question 1 Generic Strategy of News Corporation The News Corporation has employed various generic strategies that were introduced by Michael Porter. Michael Porter had proposed three strategies in order to increase competitive advantage of a company. These are ‘cost leadership’, ‘differentiation’ and ‘market segmentation’. Considering the current strategies implied in the organisation, i.e. the News Corporation, it can be observed that the company has followed the differentiation and the segmentation strategies according to the Porter’s Generic Model. As stated by Porter, differentiation strategy is highly advantageous in a broad