Page 7 - SCS May 2018 - Day 2 Suggested Solutions

SUGGESTED SOLUTIONS

to HomeVideo. It is likely that the ability to watch offline may be the most significant factor in
deciding which streaming company to sign up to and, if Couchweb fails to match HomeVideo’s
innovation, we could see many subscribers leave. Copying the competitor removes that risk,
assuming that the download functions are similar.

Potential subscribers

It is possible that the company may see an increase in its subscribers as a result of the ability to
watch offline. There may be viewers who do not wish to stream content at home; perhaps they
are satisfied with terrestrial broadcasts, or they are signed up to a satellite broadcaster. However,
the ability to watch TV programmes or movies whilst on the move may make the monthly cost
more tempting. This of course results in greater revenues for Couchweb.

Shareholders

Shareholders are likely to react well to the initiative. If new subscribers are attracted to sign up
with Couchweb, this can only help to increase shareholder wealth. Furthermore, the strategic
position of Couchweb would be protected, as it is responding positively to a competitor’s moves
that could potentially weaken the company’s competitive advantage. By copying the competitor
in providing a service demanded by customers, Couchweb is removing a possible point of
differentiation from HomeVideo.

Production companies

The only possible negative reaction may come from the production companies who licence their
TV programmes and movies to Couchweb. Whilst it will make no difference to those suppliers that
a possible increase in viewers may result through watching offline, there are restrictions in place
over where content can be broadcast. For example, a production company may have agreed that
it is okay to stream a recently released movie in Mayland, but that it cannot be seen in a
neighbouring country for another 6 months, as that movie is still on release in cinemas there. The
production companies will want assurance that subscribers will not be able to download content
in one part of the world and then potentially view it (or even show it in public) in another.

This can presumably be addressed by introducing the same controls in place over where content
can currently be seen online i.e. the IP addresses of users’ devices alerts the company to where
exactly the device is being used and prevents viewing from occurring. A simple message can flash
up on the screen advising that such content is not available currently in that location.

Indirectly affected

There are also stakeholders who will be indirectly affected (in terms of their relationship with
Couchweb):

Staff – a possible increase in subscribers can only be good for staff, as the company’s performance
improves and job security increases. It is unlikely that a significant increase in staff numbers will
be required to introduce and run the download function.

Local communities – those people who currently have access to wifi in public places disrupted due
to those wanting to watch content on the move making demands on services will be delighted.
Less viewing online can only result in a better wifi reception for others.

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