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Porter's 5 Forces
Google failed to break into the video streaming industry for many reasons. Using an analysis of Porter's five forces one can better understand the failures of Google to secure a foothold in the online video streaming industry as an independent entity.
The first force that needs to be analyzed is the threat of new entrants to the market. "Except for the early stages of market development, when new entrants can help a market to expand, new entrants bring additional capacity and resources that usually heighten the competitiveness of the market and diminish profit margins" (Lehmann & Winer, 2005, p. 56). In January 2005, when Google entered the online video market, there was little competition from other corporations. In July 2003, Metacafe, dedicated to streaming short-form original content was launched and in January 2004, MSN began to offer an Internet video download service. Instead of attempting to compete with these two companies and enter into user-generated content video streaming and downloading, Google failed to keep up with technology and...
4).
It was only in April 2005 that Google began to allow user-generated material to be uploaded to its site. In this sense, Porter's second and third forces are intrinsically tied together as the bargaining power of buyers and the bargaining power of suppliers were similar, if not the same due to its user-generated content platform. However, Google was always a step behind with demand. Its competitors were constantly innovating and offering new services that were tailored to customer demand. While other services allowed users to upload their own content in the years leading up to Google Video's founding, it was only in 2007 that Google became a formal video search engine, which actually allowed viewers to watch online videos instead of just looking up transcriptions as in 2005 (Cool et al., 2010, p. 5). Additionally, Google dealt a major blow to its buyers in 2007 when it shut down Google Video Store, especially when users lost access…
Bibliography
Cool, K., Seitz, M., and Mestrits, J. (2010, March 11). YouTube, Google, and the rise of internet video. Kellogg School of Management.
Lehmann, D.R. And Winer, R.S. (2005). Analysis for Marketing Planning. 6th edition. New York:
McGraw-Hill Irwin.
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