Analyse the Pay Tv Market in Sa Using the Five Forces Framework Essay

The threat of rude(a) entrants in the South African Pay TV mart is low for reasons discussed below Capital Requirements The graphic symbol study clearly states that sack up TV spent in the part of R1 billion to become operational which shows that the capital needed to do military control in this industry is steep. The case also highlight other licensees much(prenominal) as WOWtv and Telkom Media (later sold to become Super 5 Media) struggling to ensnare and pay debts respectively.Further proving that the capital needed to operate in this surround is very huge requiring investors with a strong financial muscle. Product specialization There is brand identification and loyalty to DStv for the simple reason that it has been the barely player (monopoly) in this industry for more than 15 historic period and has construct huge fences around it to couple brand loyalty by get into into coarse exclusive deals with some of the biggest channels and studios in the US.Cost Disadvantage s DStv has benefitted from the instruction and experience curve and being that it has been the only player in the market for a long time it has exploited this by entering into long exclusive deals, putting proper technology infrastructure to avoid technical glitches that for instance Top TV experienced. These cost advantages positions DStv well ahead of new entrants or discourages new entrants.The threat of new entrants is also low because of the struggle muscle DStv has in fighting off new entrants as it exhibit to Top TV, by coming up with a new carry of packages that also targeted the lower LSM groups which Top TV had targeted. This repositioning of DStv had huge resist effects on Top TV to a point that Top TV is fighting to stay in business. Last but non least DStv has gained economies of scale in research, marketing and financing over the years they have been operating as a monopoly.