News Corporation SWOT and PESTLE Analysis

Strength

This section is available only in the 'Complete Report' on purchase.

Weakness

This section is available only in the 'Complete Report' on purchase.

Opportunity

1. Ever increasing market growth of digital media industry: According to leading industry research publications, global entertainment and media industry is growing at a CAGR of 4.4 percent as of 2018 with more than 50 percent of it is accounted by digital revenues. Further, the number of media and telecom deals rose 29 percent in 2017, to 876, which is a tremendous improvement. Also, with 5G networks coming up (which will make content delivery faster than ever), the numbers are expected to improve only. All these above-mentioned statements direct to only one conclusion that for News Corp, there can be no time better to invest as much possible in its digital media sector and build a loyal customer base. A loyal customer base is very important as competition will also rise along with the opportunity and customer churn will increase. Also, due to market growth potential of the industry, more and more personalization and customization is bound to happen with increasing power of technology and analytics. So, this creates huge opportunities for the firm to act fast and capitalize early.

2. Multiyear sports rights agreement: According to an industry study on sports, leagues and federations, 2017, the global sports industry is worth $620 billion out of which live sports events are an integral part. This will provide opportunities to media giants like News Corp to step in and invest to get revenues from viewer subscription and advertising both. One such step has already been taken from News Corp by forming a strategic alliance with digital football business “Dugout” to drive its Asia growth. This was a very important step which helped the company to untap the fastest growing economy of the world i.e. Asia. Many such initiatives are required, to solidify the trust of the viewers on the content delivery of the company and multiyear sports agreements is one of the most important one. Multiyear agreements will bind the sports agencies to one company, which will give plenty of time to the company to form and implement innovative strategies and understand inside-out what the viewer want them to deliver.

3. Accelerated technological innovations: Technological innovations and disruptions are currently changing the landscape of the media industry. Some of these are mass digitization, always advancing video technology and the increasing complexity of mobile phones along with their features. As the cost of technology continuous to drop, it is starting to attract masses. According to the survey published by “We are Social”, there are 4388 million active internet users as of January 2019, out of which 3484 million are active social media users. This statistic brings us to a conclusion that as technology is expanding its roots, the opportunity to do business is also increasing like never. Further, innovations like real time language translations, chatbots, AI in mobile apps have not only opened doors for media industry to sell their service in new ways, but also give these companies a chance to improve on customer service further improving customer retention.

4. Customer migration towards new media segments: The more the technology advances and the cheaper it gets, the number of people using it increases to a great extent. For example: Traditionally news only meant “newspaper” as there was no internet penetration, no televisions etc. Slowly Tv’s came up and people started watching news on the cable. Now, after so much internet penetration and digital media advent, forget newspapers, revenue generated through television cables have started reducing. This shows that customers tend to migrate from one medium of content delivery to another in search of convenience, compatibility and better service levels. But this transition doesn’t come at random, it depends on various factors like to which segment the change has occurred, whether will it be possible to migrate or not depending on the pocket size, feasibility of the decision etc. Further, it is a great opportunity for News Corp., as the firm has strong brand recognition in the premium segment and in the lower segments customers very well know about the excellent services provided by the firm.

Threat

This section is available only in the 'Complete Report' on purchase.

Political

This section is available only in the 'Complete Report' on purchase.

Economic

This section is available only in the 'Complete Report' on purchase.

Social

This section is available only in the 'Complete Report' on purchase.

Technological

This section is available only in the 'Complete Report' on purchase.

Legal

1. Regulations related to data privacy and security: Regulations regarding data privacy and its security are getting tightened by every country, which can act as a potential threat to the media industry. This is because any firm operating under this sector requires vast amounts of data, so that they can run algorithms and analyse what customers actually want. This helps the firm to customize their services according to what their target audience actually wants.

2. Anti-siphoning legislations in Australia: Anti-siphoning legislations of Australia is responsible for preventing pay-tv providers from acquiring rights to televise events such as the Olympic games, Australian cricket matches etc. This will act as a barrier for News Corp which will struggle for viewership. Also, this kind of legislation have an impact on the firm’s ownership structure and operating efficiency which may increase costs. Also, the earlier advantage of acquisition or investment opportunities may get restricted now.

Environmental

1. Climate concerns and the waste generated: The climate of the target market can significantly impact the ability of News Corp. to manage its logistics domain, particularly transportation of the raw materials and finished goods. Further, Paris Climate Agreement has put stiff targets for the national governments which can result in greater scrutiny of environmental standards for News Corp in both developed and emerging markets. Also, News Corp will have to be very cautious on the kind and the amount of waste generated as the company is required to abide with the environmental laws, failing to which, they may increase reasonable financial strain on themselves.