Porter’s Five Forces are one of the basic tools for market research and business strategy development. However, this model has several significant drawbacks. First, it is a highly simplified diagram, which can often only serve for a general analysis of the situation. Second, it views the market and interactions between firms as a highly negative experience. In history, there are cases when the interaction of firms led to their joint development, which led to the emergence of the opposite theory, Coopetition and Value Net, developed by Adam Brandenberger and Barry Nalebuff (Besanko, 2016). This paper aims to study Comcast Corporation within the framework of this theory to analyze the development opportunities of this corporation in interaction with the market.
Comcast Corporation is one of the largest telecommunications companies in the United States and globally, providing it with a massive area of influence and interaction. The corporation was founded in 1963 and has since scaled up, buying several companies and expanding its services (“Comcast Corporation,” n.d.). In the approach proposed by Brandenberger and Nalebuff, the concept of positive effects of competition appears, and competition and company interactions are part of the Value Net analysis model. However, in the context of Comcast Corporation, it is almost impossible to talk about any competition due to the scale of this conglomerate.
Comcast’s three main divisions occupy the cable, internet and telephony niches in Comcast Cable, the television and film studio under NBCUniversal, and satellite television through the European company Sky. In addition, the company acquired AT&T Broadband in 2002 and DreamWorks Animation in 2016 (Reiff, 2021). Thus, Comcast is one of the most prominent players in the media market, practically unrivaled except for similar media giants like Disney. Therefore, the positive effects of competition cannot be discussed in this context since competition with Comcast is almost unrealistic.
In addition to competitive conditions, like Porter’s five forces, Value Net analysis also concentrates on studying suppliers, complementors, and customers. Speaking about the suppliers of Comcast Corporation, it should be noted that due to the significant number of services, it is challenging to single out any separate category of them. Thousands of people provide their services to Comcast, and this number only grows with the purchase of various companies by the corporation. Given Comcast’s influence, they can impose their opinions on suppliers, depriving them of choice. However, on the other hand, working for such a huge corporation is a reason for competition among suppliers, as a result of which they can improve, trying to provide their services better.
The same is true for complementary services, which include, for example, additional settings on streaming services. There are many opportunities for business expansion and Comcast to engage positively with smaller companies in this context. Given the wide variety of spheres of influence in which additional products can be sold, companies can compete to implement them in, for example, streaming services and satellite pay-TV services.
However, the positive aspects of the interaction of a corporation and small companies are overshadowed by the quality of the final services provided. As practice shows, Comcast is one of the worst US companies in terms of customer satisfaction. This is primarily due to controversial decisions and scandalous incidents of the company (Miller, 2020). This eventually led to a special division of the company, rebranded under the Xfinity name to reduce negative associations with Comcast’s past. Nevertheless, all the measures taken brought Comcast only to an average level in all ratings, which is a depressing factor for such a huge corporation.
Thus, the Value Net analysis for Comcast Corporation gives exceptionally mixed results. The scale of the company and its policy towards clients leave almost no room for a positive assessment and the possibility of cooperation. On the other hand, having many brands and complementary products allows smaller companies to partner with Comcast to collaborate on projects. Currently, the corporation occupies a dominant position in the market and has little interest in additional cooperation due to the lack of large-scale competition. However, the company’s difficult reputation may soon create a need for teamwork.
References
Besanko, D., Dravone, D., Shanley, N., & Schaefer, S. (2016). Economics of strategy (7th ed). John Wiley & Sons.
Comcast Corporation (n.d.). Web.
Miller, D. (2020). Why does comcast have such a bad reputation? Reviews. Web.
Reiff, N. (2021). 5 companies owned by Comcast. Investopedia. Web.