Page 16 - SCS May 2018 - Day 2 Suggested Solutions

CIMA MAY 2018 – STRATEGIC CASE STUDY

Another risk around licensing agreements could be relating to the different countries we are
licensed to stream certain content in. We would need to look into the ability to delete or block
certain content if the registered device moved countries to an area where Couchweb do not have
the rights to stream particular shows. Applications are normally able to use location services on a
device to assist with this.

An issue we need to consider is how we implement the new service offering. We should maintain
a record of how many members have upgraded to the new service, and also how many and how
regularly they are using it. We can track how many members upgrade to the service by putting
the new service in a new app, so our members have to download the update and then register
their device on their account.

There must be clear communication about the limit on the number of devices that our members
are allowed to use and why. Failure to do this could lead to upsetting the members and damaging
the reputation of Couchweb.

The update should only be made available to users who have devices that have the capability to
handle the additional features. Consideration must be given to the operating systems that the
users’ devices have installed, if the update happened on a device that does not have the capability
to support the new service it will harm the user experience, which could again damage the
reputation of Couchweb.

There is a risk that users do not appreciate how big the files they are downloading are and so
communication around managing their device storage & also data usage contracts with their
mobile phone or internet service providers. Downloading the files will use a similar amount of
data as streaming the shows so reminders about data usage should be sufficient to avoid
customers incurring significant costs by going over their contracted data usage.

Free membership with adverts
A key risk here is damage to our reputation; we have always offered an advert free service and if
members misunderstand the new offering they may incorrectly think that all users will receive
adverts. Clear communication with our members to explain how this will work is important.
One possible way to minimise this risk is to set it up as a separate application, so there is no
chance of the adverts appearing on a paying member’s content.

Another key risk is that it fails to generate a return for Couchweb and potentially reduces our fee
paying revenue stream. Research into lapsed members or people who have never subscribed to
Couchweb to gauge demand for this free service will help us understand this better.

Another issue is that the service fails to attract sufficient advertising revenue, the research into
demand could be used to research into and negotiate fees we would receive from prospective
advertising clients and the companies that would be interested in advertising through our service.

A further consideration for controlling these risks is that Couchweb initially offer this service as a
trial. This way it would give an exit route should the service not work out as well as we expect,
and if we did exit we could gain new paying members who had tried the service for free and
enjoyed the content they were able to view.

There is also a risk that we compete with ourselves and some fee paying members effectively
downgrade to the free service. Depending on the fee income from advertising this may still lead
to an increase in overall revenue. A control to discourage people from downgrading could be to

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