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Week 3 CheckPoint 4:  Picture the Supply Chain

Aziza Gary

XBIS/219

5/24/2013

Dr. Shawn M. Rieder

Week 3 CheckPoint 4:  Picture the Supply Chain

Looking at the downstream segment of the digital division of Warner Bros. supply chain, I

recommend licensing or similar contracts for Video on Demand (VoD) vendors, such as NetFlix,

BlockBuster, Hulu, Vudu, etc., to store and distribute content on and from their servers. This will

eliminate additional costs for security, storage and personnel to maintain these servers at Warner

Bros. This will also allow the end user or consumer easy access to a larger database of the media

Giant’s content. Though eliminating this portion of the print division will take away additional

revenue that could be earned from sales of DVD, HDDVD, and Bluray to retail and wholesale

customers, it will lessen the overall opportunity costs. Without the added expense of print

production for this segment, Warner Bros. will be able to funnel those allotted funds into

upstream and internal operations to make these areas more productive and streamlined; thus,

producing better content for the end users at an accelerated, but efficient, pace of less than

several months at lower overall costs. However, with the elimination of print discs in every

format going to large VoD companies such as NetFlix and Blockbuster, they can still recoup the

lost revenue for wholesale sales of the prints from the many VoD companies that are all-digital.

This also falls in line with what most customers want. Not many people nowadays rely solely on

print discs anymore with the many types of mobile devices that simply need a WiFi connection

or large enough storage to conveniently store ones favorite content. The addition of specialized

software to facilitate any updates of Warner’s newest content onto the VoD’s servers will also

benefit both WB and the VoD. These investments in technological...