Unique resource that gives Newscorp a competitive advantage is their use of vertical and horizontal integration. Newscorp have a vast amount of highly skilled and experienced managers. They can use this to bring people in from different departments to work as a team and therefore make new ventures successful. For instance when they acquired BskyB, they got the technological staff to deal with the encryption and they got the advertising staff to advertise across different boards therefore do not have to rely on outsiders which in effect lowers cost.
NewsCorp have a number of managers, but they have very little time to do anything else because they are concentrating on their own individual activities. This produces a weakness for Newscorp. Newscorp has very little spare capacity so they have to think about how they will implement future strategies. If you haven’t got any spare capacity or resources left, you have to think how you’re going to put it in operation
The following factors have an influence on News Corp to analyse how the company’s strategy had been influenced up to the present date and view these as opportunities and threats to stay ahead of competition and minimise threat. Political and Legal: Policies will differ depending on the host countries government stability, taxation policy, the foreign trade regulations, and social welfare policy and competition law. News Corp has benefited a lot from Murdoch’s political friendships. However in the future, they have to take into consideration the likelihood of any political or legal factors changing and if so set their strategy in such a way that it can easily adapt to meet their requirements.
Economic: Economic situations vary from country to country, which means that different strategies have to be adopted in each country. These could be determined by the impact of business cycle, interest rates, disposable income and GNP trends.
Socio- cultural: News Corp device strategies to accommodate consumer interest as this differ from region to region. Understanding and adapting to consumer needs is always an advantage. For instance, in the Asian Market, STAR’s focus changed from broadcasting programming in English to their native language which became more appealing to the target audience.
Technological and Environmental
News Corp spends a lot on research and development to remain competitive. An example of this is the technological development of encryption technology saw revenues being created and protected. However, today’s technology has to be developed in such a way that it meets with environmental obligations. Emissions have to be kept to a minimum and energy-saving schemes have to be adapted to meet environmental laws and as a social responsibility
Sky operates in a mature market. Sky controls the encryption technology and is currently the gatekeeper of the satellite broadcasting in the UK. For any channel operator, getting through the gate requires the payment of significant fees. Suppliers Because Sky is a large company and the brand is highly recognised, this enables the company with bargaining power against local and global suppliers.
Buyers The regional and global operations show that consumers have a very strong bargaining power. TV channels rely heavily on viewers to watch their programmingFollowing the acceptability screening, the winning strategy is by acquiring Amstrad. In practice this is a great opportunity as Newscorp likes growth and Amstrad could be added as one of their portfolios and in terms of strength it’s a great asset as it lowest the cost of production. They could leave the management and employees to maintain the brand loyalty of the company and this will work as its has been before. News Corporation has grown from the publisher of Australian newspaper into the world’s most international media provider. The company has distinguished itself by delivering two things above all else quality and choice.
If Newscorp acquire Amstrad, it will enable it to accelerate and rollout of enhanced TV services. Newscorp already controls content, and this deal importantly gives it full control over the future direction of its set-top boxes. The acquisition accelerates supply chain improvement and will tem to drive innovation and efficiency for the benefit of their customers Acquiring Amstrad will boost Sky’s technical capabilities by allowing it to streamline the process of designing and procuring set-top boxes.
For BSkyB the deal means bringing one of its main set-top box suppliers in-house and should speed up the development of new products as it seeks to stay ahead in the increasingly competitive pay-TV market. Until now, BSkyB’s developers had come up with product specifications in-house then gone to potential suppliers asking them to come up with detailed designs to be made and sold back to Sky. Making Amstrad a sub-division still cuts out much of the costs for BSkyB and speeds up the process.
BSkyB could in the future look to supply Amstrad set-top boxes to other satellite operations around the world owned by News Corporation, which is BSkyB’s largest shareholder with a 39% stake. These include Sky Italia, Star TV in Asia and Australia’s Foxtel, which News Corp subsidiary News Limited manages with a 25% stake.