CASE STUDY OF TIME WARNER (LOCATED NEAR END OF TEXT BOOK) - Assignment Example

Only on StudentShare

Extract of sample
CASE STUDY OF TIME WARNER (LOCATED NEAR END OF TEXT BOOK)

Upon looking at the tables given, demand is apparently elastic, with a lot of competitor networks around. One thing that makes a demand elastic is the presence of many substitutes, meaning competitors which can be easily availed by the potential customers. Network competitors include ABC, ESPN and Disney from Disney Company; CBS, MTV and UPN from Viacom and Fox from News Corp.
Given that the promotional decline in price is only given to STARZ's current and future subscribers, and would not affect its big network businesses such as HBO and Showtime, it will be worthwhile to lower the price for the purpose of attracting subscribers. The decline in revenue from existing subscribers is deemed smaller than the potential revenue, given the larger market that it has to cater. Also, the popularity of STARZ, as it would be well advertised given the promotion is also worth the price. Since the current revenue of STARZ is just .5% of the total revenue from subscription (excluding advertisements and content), meaning there are a lot of room to grow in the current market, revenue can double or triple with the promotions.
The revenue growth rate figure for News Corp's Fox News is really admirable, standing at 67.8%, compared to last year. This is superior to CNN's 12.5%. ...
Download paper

Summary

The case involves a simple question of whether lowering the price of subscription, as a promotional campaign would boost or would further dampen the revenue. Currently, the company receives monthly revenue of $ 8946 per month, a very small amount compared to its subscription revenue of $ 20, 448,000 for the year…
Author : vernicearmstron

Related Essays

Case study Case Study
An order for specific performance of the contract was appropriate because of two reasons: 1) the Wirraway was not at the time in flying condition, and 2) the plane was in a hangar owned by a third party.
...
6 pages (1506 words) Case Study
AOL Time Warner: Deal of the Century Turns into Disaster of a Lifetime
The deal also had ramifications for television networks, cable networks, and radio networks (Lehrer, 2000).
...
4 pages (1004 words) Essay
Aol Time Warner Merger By Nina Munk
During the same year the group's recording and music publishing arm was sold for US$2.6 billion to a consortium led by Edgar Bronfman (former head of Universal), becoming Warner Music.
...
5 pages (1255 words) Essay
Book Analysis "The End of Blackness" by Debra. J Dickson
(Jayne O. Ifekwunigwe, 2004)
...
2 pages (502 words) Essay
TIME WARNER CASE
Statistics proves that the cable industry and the broadband market are in a growing phase. The cable penetration is almost touching 0.7 per one household as per the statistics of 2003. The broadband subscribers have increased by 44.78% in 2003 in respect to 2001. Considering this statistics and the household base of Kansas City to be 321,000 we can expect the business to grow. With a 50% market share we can expect the gross profit to be around $70, 45,950. It will important for us to know the pricing of Everest on a time to time basis, so that we can evaluate our pricing accordingly. At the...
1 pages (251 words) Case Study
Media Economics and Research: Time Warner Case Study
The company also largely consists of assets taken from the former Warner Communications, such as HBO that was the subsidiary of Time Incorporation prior to the merger of Time Warner. The company also has some assets taken from the Turner Broadcasting that was acquired in the year 1996. Time Warner currently has some major operations going in the television and film industry and it also has some publishing operations going on in the comic’s books industry. New Line Cinema, CW Television Network, HBO, Turner Broadcasting System, Kids’ WB, Boomerang, Cartoon Network, Hanna-Barbera, Adult...
7 pages (1757 words) Case Study
Got a tricky question? Receive an answer from students like you! Try us!