The Current Red Ocean Strategy of the Streaming Service Market

We all have started feeling the annoyances of getting messages from our favorite streaming providers that a specific channel or network is leaving their service or a notice of a non-negotiable price increase.

All this is a perfect example of the Red Ocean Strategy that has taken control of the streaming services market, something one would think large corporations would understand and avoid. Unfortunately, that is not the case as the ultimate loser in this strategy is their customer, who in turn will lose the company. This phenomenon all began because customers wanted choices, rather than take it or leave it bundle systems of yesterday’s cable programs. Now, with pioneering companies like Netflix and Amazon Prime leading the way, everyone wants to have their streaming service, blooding the waters for customers and companies alike.

So, let’s break down the difference between Red Ocean and Blue Ocean Strategies and see if you can find the potential future problems that streaming providers will face.

Red Ocean Strategy*

1. Compete in existing market space

2. Beat the competition.

3. Exploit existing demand

4. Make the value-cost trade-off.

5. Align the whole system of a firm’s activities with its strategic choice of differentiation or low cost.

Blue Ocean Strategy*

1. Create uncontested market space.

2. Make the competition irrelevant.

3. Create and capture new demand.

4. Break the value-cost trade-off.

5. Align the whole system of a firm’s activities in pursuit of differentiation and low cost.

*BlueOceanStrategy.com

Andrew D. Sternke, JD is a business expert that is passionate about the integrations of business, law, and public policy.

unnamed.jpg