The Movie Entertainment Industry ( Current Issues ) Research Paper

The Movie Entertainment Industry ( Current Issues ) - Research Paper Example The strategy is quite simple: movies became more larger than life, splashier and are made to impress in order to attract the public who have become more sophisticated in their tastes. This has become the blockbuster formula that has worked for major studios. By 2002 the annual ticket sales peaked at $1.6 billion.1 After this period, however, one can no longer say the same. In 2008, the figure dropped to $1.3 billion while the audience registered a constant decline in size across all segments of the movie-going public except teenage boys.2 Hollywood’s formula for blockbuster films - one that has so far succeeded in impressing the audience and keep them coming back - relies much on technology because it is crucial in providing flashier visual effects, which has been proven to appeal to a broader audience. Background According to Vanhala (2011), the average production cost of a movie from a major studio is $55 million with an additional $27 million to advertise and market, a tota l of almost a hundred million per film.3 Big productions that almost often assure box-office success could cost a studio up to 300 million dollars such as with the cases of Spiderman 3 and Pirates of the Caribbean 3. The figures are humungous and one could often hear producers lament about the viability of moviemaking and of the way films lose even with a decent performance at the box office. The complaint is not entirely unfounded. A detailed explanation has been offered by Vanhala as it was suggested that domestic box office, home video, DVD, television and cable revenues often cannot collectively cover the invested money in a film unless it is a major blockbuster.4 Pricewaterhouse-Coopers reported that the major studios’ revenues can be broken down as follows: 1) theatrical box office 24.6 percent; 2) television 28.8 percent; and 3) Home Video 46.6 percent.5 There are those who would argue that other means of revenues could make up for box office losses but this is not alw ays the case. According to the Motion Pictures Association of America â€Å"most films never recoup their initial investment.†6 A case in point is Prince’s (2002) discussion of movie revenue in which he stressed: There is little home video revenue left over to pay back the substantial negative cost still on the books from a theatrical flop. Home video success in such a case is significant for the company’s cash flow and especially for its home video profit center, but profit participants due a percentage on the theatrical flop are unlikely to be close to paydirt.7 It is not surprising, hence, when both academics and economists brand moviemaking in American as a risky affair. The dynamics by which film financing are undertaken with their complex and elaborate risk-sharing schemes underscore this point. Today, films are no longer produced by one studio or entity. Investors are pooled, which include corporate entities and other third-parties such as A-list actors, directors and producers.8 Out of all of the dismal statistics cited, however, it is interesting to note that Hollywood still makes about 400-600 films each year.9 The answer to this puzzle is crucial in identifying the effect of technology in movie-making. Understanding them can help outline the importance of technology in American filmmaking today. There are two identified drivers to the American film industry’s profitability: blockbuster films and the international market. These two areas proved to be not just the

Target plc Assignment Example | Topics and Well Written Essays - 2750 words

Target plc - Assignment Example The study provides the details financial analysis of the company. In the case study the financial and operational evaluation of the company in questions has been undertaken. For the purpose of operational capability of the company, its corporate strategy has been analyzed in addition to the competitive environment and other risks to which it is being exposed. Target Plc is not a new name in the retail, food and ingredients industry and is considered analogous to quality and premium branding. The company is a diversified conglomerate having five major strategic segments which are sugar, agriculture, retail, grocery and ingredients. As per the latest financial statements of the company for the annual year 2012, the company is operating in almost all of the major cities of the United States. The vision and mission statement of the company is to achieve strong leadership in the course of business which is sustainable and long lasting. The company always strives to provide quality product s to the individuals and other consumers and to become a necessary brand in the people’s day to day active life. Financial Highlight [Annual report Target, 2012 , Pg2] As apparent form the above financial highlight, the company presents a strong financial outlook and appears to be a lucrative company for the investors to invest in. The company has various revenue centers through which the company generates most of its revenues. During the financial year 2012, the highest earning revenue center for the company was heath, beauty and households which constituted about 25% of the total revenue of the company. Corporate Strategy Target Plc is now actively involved in acquiring new stores in order to capture a significant market share in the industry. Currently the company is facing tough competition in the market as new entrants are entering in the market and taking advantage of the new and improved industry state. The company current corporate strategy is to refurbish the acquire d stores and outlets so that they have fashionable, modern and attractive presented stores located in prime locations all across the region. The primary capital expenditure of the company consists of extending its stores portfolio. Competitive Analysis In order to analyze the financial outlook of a company, it is of prime importance that the cost leadership and differentiation strategies of the company are analyzed. In addition, the best method to assess the competitive advantage is through porter’s five forces model. The major competitors of Target Plc are as follows: Wal-Mart Stores Kmart Corporation Costco Wholesale Corporation Competitive Advantage Porter’s five forces model is an effective tool in exploring the competitive forces of the environment in which the organization operates. It allows the business to critically analyze its current business strategy and formulate one which can allow it to achieve a competitive position in the market. With the advancement i n Information Technology, it has been prominently observed that the businesses are now focusing more and more on implementing information system in order to make the best use of their resources. In the mentioned case, Target Corporation has several functional units carrying out activities related to the manufacturing and delivering of Sports merchandise. By integrating these units using information system, Target Corporation can gain competitive advantage in the market which can by analyzed in the light of Porter’s five forces model. The first competitive force according to the model is the entry of new competitors into the market. New entrants might be able to capture some of the market