Free Essay

Shomi Marketting Analysis

In: Business and Management

Submitted By arshm
Words 640
Pages 3
Television industry is going through a phase of transformation, where the traditional way of watching TV is getting replaced with on-demand and online video streaming. As consumers want access to more content on their TV’s, online video streaming apps such as Netflix, Shomi, Crave TV, Hulu etc. are doing a great job to satisfy the current needs of the consumers. In Canada, the pay TV and online streaming subscriptions are rising significantly as their market share increases each year. As per the Charlton Strategic research, as of year 2014, 69 percent of video viewing in Canada still comes from paid TV cable packages, whereas 37 percent comes from online video streaming sources and pay per view (Bradshaw, 2015). There has been a constant growth in the video streaming industry as they are slowly taking over the Canadian TV market. In Canada, each year numerous households get rid of the cable or the satellite TV and opt for video streaming instead. This number reached 240,000 in year 2014 as households in Canada continued to cut the cords (Bradshaw, 2015). Moreover, the recent trends also show that the majority of video streaming users belong to the age group of 18 to 25 years old (Bradshaw, 2015).

The Technology Adoption Curve
Online video streaming is relatively a new form of technology in the in the market. A company named Netflix, which currently has the largest customer base in the market, first introduced online video streaming in year 2008. Being a new innovation in the American market, innovators gave it a kick start in its early years by buying monthly subscription. With the positive response from the innovators, the product gained popularity among the American population and it was just a matter of time when the product was launched internationally. Currently, In Canada the average video viewing from streaming accounts to 37 percent of the total viewing. Therefore, if measured on the technology adoption curve, video streaming is in the stage of early majority in Canada.
Porter’s Model of five forces
As discussed above, the video streaming industry has entered the growth stage and as a result is growing exponentially with each year. According to Porter’s model of five forces, a variety of forces, which includes; new entrants, suppliers, consumers and substitute products impact the video streaming industry. As Netflix established its roots in the US and Canada, there have been new companies emerging in the market in order to compete against each other as there is a huge potential of consumers to be served in future. The main competitors that have emerged so far include; shomi, Hulu and Crave TV. Shomi is a Canadian based video streaming system that is owned by Rogers communications in order to establish themselves in this market and compete against one of the biggest company in this market i.e. Netflix. Also, the content offered to the consumers help the company’s gain competitive advantage over each other for example; Netflix created a show named “House of Cards” which is exclusively shown on their website but nowhere else. Bargaining power of consumers is another element that contributes to the industry rivalry. As the competition is increasing consumers have choices to choose one company over the other, which creates pressure on the companies to offer similar services on cheaper prices for example; Shomi offers its HD subscription for $8.99 per month whereas Netflix offers the same for $9.99 per month. Moreover, there is threat of substitutes to this product i.e. satellite or cable TV, which is more expensive but for some consumers it is of more importance as it offers live coverage of sports, events etc. which is not offered by online video streaming company’s.

Works Cited
Bradshaw, J. (2015). Streaming wars: How disruptors are shaking up the TV business. The Globe and mail.

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