Business Proposal for Research to Assess How

Business

Proposal for Research to Assess How Optimum May Improve their Market Position

Background to the Firm

The Product

Current problem

In a dynamic commercial environment it is necessary for firms to continually look for ways in which to improve, the aim of this paper is to look at Optimum, and outline an approach for research which will help the firm to identify the way in which it may improve performance and remain competitive. To undertake this, the first stage is to look at the firm and assess its products, current position and nay problems or challenges it faces. Using the problems or challenges an area of research may be identified, with the creation of a purpose statement and assessment of the way research may take place to resolve or minimize those problems.

2.

Background to the Firm

Optimum is a firm operating in the New York tri state area, as well as Montana, Wyoming, Colorado and Utah, where it is referred to as Optimum West, offering a range of services, including television, internet and other communications-based services. Optimum is a brand name of Cablevision, which was founded in 1973, in Long Island. Today the firm has millions of customers with the sale of packaged, or multiple products with average revenue per customer of $135.62 per month (Cablevision, 2012). In 2012 the firm had total revenues of $6,705 million (Cablevision, 2012).

The firm is undergoing some changes; a recent agreement to sell off the broadband services of the Optimum West area indicates an increased focus on the television services. In an industry where there is a high level of competition, especially from Verizon and AT&T, this smaller firm needs to be able to compete effectively.

3.

The Product

The product area being examined is the cable television service. Cable television is delivered to the Optimum service subscribers, who receive multiple video channels. The firm offers a range of video channel packages with different types of programming and channels, and subscribers choose a package to match their needs and tastes. The television service is delivered through fiber optic and coaxial cables, satellite transmission as well as traditional terrestrial airwave transmissions. The firm also offers packages that combine the cable TV service with other services, such as broadband internet and telephone services, starting from $84.95 per month (Optimum, 2013). The video customers are the most valuable, as the average revenue per video customer is $152.35 per month, higher than the overall average (Cablevision, 2012).

In addition to the regular subscription services for which the customers pay a regular fee there are also pay per view options for special events and on demand videos, which generate additional income. The firm has also increased access to the television services with the distribution of a free app for use on android and iPhones, allowing customers to access their services through the internet (Optimum, 2013).

4.

Current problem

The main problem faced by Optimum is the high level of competition, especially with two firms in their area; Verizon and AT&T; both are larger firms, with greater resources and have the ability to compete in an aggressive manner (Cablevision, 2012). It is this high level of competition that has resulted in the firms decline in revenues, from $7,773 million in 2009 to $6,705 million in 2012 (Cablevision, 2012). Competition is also intensifying with increased access to media through the internet and the use of both legal and illegal download sites to access video content.

The firm is losing customers, and more may be lost, especially with the high investment made in fiber optic cable by Verizon, the firm needs to find a way to retain and regain customers and compete effectively.