Youtube Case Study

YouTube Case Study

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

Video and torrent websites have challenged the movie industry by providing customers the power and convenience to stream and download movies over the internet rather than the traditional purchase at a conventional store. The most successful video-sharing website on the internet is YouTube with millions of views daily of illegal posting of copyrighted movies and television shows, webcam video diaries and amateur films.

YouTube provided millions of customers an outlet to view movies free of charge, resulting in decreased sales of DVDs and revenue loss for the movie and television production studios. The movie industry was challenged by all five competitive forces when YouTube and other online movie distributors entered the market, attracting customers a substitute for watching movies and television shows and providing them more power to bargain for lower prices. However, new market entrants and substitute products are the two main competitive forces that challenged the movie industry the most.

YouTube has a lower cost to maintain its video-sharing website than for production studios to make movies costing an average of more than $129 million. There were measures taken by YouTube to discourage its users from uploading illegal copyrighted content such as limiting the length of videos to only ten minutes and removing videos on request by the copyright owner. This did not deter users from reposting the illegal copyrighted videos after it was removed. Some production studios invested into resources to search daily for property that was posted without permission but quickly realized it was an unachievable goal and decided to find more constructive solutions.

The movie industry embraced YouTube as some of the productions studios established...