Time Warner Inc.: Strategies For Entry And Competition In International Markets

Defining the strategies for the foreign market entry

Describe about Time Warner, Inc. as the company for this research paper and also discuss for Strategic Management course?

Hanif and Yunfei (2013) have stated that Porter’s generic strategy demonstrates how a company pursues competitive advantage across its selected market. Cost leadership, differentiation, cost focus and differentiation focus are the major four parts that determines the competitive advantage of the company. In this particular task, the focus would be shed on the adopted generic strategies of the company Time Warner Inc. and how the company has strengthened its generic strategies through complementary strategies that have moved into the existing industry. Apart from that, it is also important to mention the strategies adopted by the company to take entry into the foreign market and the importance of the strategies from several perspectives (Bharadwaj et al., 2013).

Significantly, the learner has tried to evaluate the role of the CEOs and the other executives of the company in leading positions of the company for a long-term success. In order to carry on the entire study, Time Warner Inc. has been taken into consideration and this is a global leader in the media and entertainment with enhanced businesses in the television networks and firm and TV entertainment (Time Warner Inc., 2016). The company uses its industry leading operating scale as well as brands to create, package as well as deliver high quality content internationally on a multiple platform basis (Mellahi & Frynas, 2015).  

Defining the strategies for the foreign market entry

From the company website, it can be found that the company had the initial aim to become the world’s leading video content company. The company has enough reputation in the existing market as one of the top media and entertainment companies. The benefits for the employees, the employee diversity resource group, adopted green initiatives as well as volunteer programs are strong enough and these are the key factors that have helped the company to take part in the foreign market. The demand of media and entertainment market has been gradually increasing globally and this is one of the major facilities for Time Warner Inc. to expand in different parts of the world. In the year 1990, Time Inc. and Warner Communication merger together to form Time Warner Inc. and this was one of the major strategic decisions for the company to have a strong hold in the existing market (Time Warner Inc., 2016).

• Précising the definitions of the changes that are highly required.
• Specification of how the new working methods will affect particular people and the groups.

Identifying the strategic approaches for competing internationally

These two were the base of the adopted strategies that helped the company to take entry into the international market. Offering some of the attractive packages for the employees as well as the customers depending on the need of the market are some of the strong strategies that the company has taken care of.

Identifying the strategic approaches for competing internationally

The company has been shedding importance on effective approaches in order to compete in the international market. These have been discussed here in details.

• The company has been planning on preparing the cable bundle to be more attractive. Cable networks like TBS, TNT and CVV generate more than one third of the entire revenue (Time Warner Inc., 2016). Therefore, it is clear enough to say that in order to attract large number of customers and enhance the business presence; the company has been making their package highly attractive.
• The company as well has planned to cut the guidance and is expecting to earn about an adjusted $6 per share next year but has trimmed the guidance during the call.
• The company has engaged itself into detail market analysis and this has helped the company.

Outlining the ways through which the company gains competitive advantages from international operations.

In this part, focus would be shed on the ways through which the company gains competitive advantages from their international operations.

• The company uses their industry leading scales as well as brands in order to increase investments in the best storytelling. It has been clear from the detailed market analysis that Time Warner Inc. has been highly focusing on its growth for HBO. HBO has been one of the popular channels and this is the home of Game of Thrones. Therefore, it is obvious enough to say that the company would focus on the enhanced collaborative relationship with HBO (Times, 2014).
  
  
• The company has been harnessing several new technologies as well as developing new business models in order to increase the value of their content to the valuable consumers along with the distributors and drive growth for the business.
  
  
• Market analysis has stated that South East Asia and European market are the two most emerging markets of this company and thus they have been designing their strategies likewise.
  
  

Figure 1: Sales of Times Warner Inc. by geography

(Source: Mellahi & Frynas, 2015)

• The company has significantly increased their presence in the most attractive and productive international territories in regards to perceive advantages of growing demand for their content internationally (Time Warner Inc., 2016).
  
  
• From the company profile, it can be found that the company has been optimizing their operating as well as capital efficiency for providing attractive returns to the shareholders.
  
  

Figure 2: Profitability Ration of Time Warner Inc

(Source: Mellahi & Frynas, 2015)

• The company believes that if they do not return an attractive amount to the stakeholders, the stakeholders would not like to invest in the company and this is one of the major concerns of expanding the business in the international level.
  
  

Figure 3: Income Statement and Revenues of Time Warner, Inc

(Source: Mellahi & Frynas, 2015)

Strategies of the company for competing in the international markets

For this specific company Time Warner Inc., cost strategy is the best generic strategy and the company has chosen to be one of the best cost providers due to existing huge needs for differentiation. It is important to mention that there is a need to be competitively priced and thus the company has been planning to revise their present pricing strategy. Bharadwanj et al., (2013) has stated that the company has stiff price competition and this is especially true with the members of the big industry, at the time of offering bundles as well as standalone services that offer individual services at a cheaper rate. Therefore, it can be stated that the company is required to differentiate as well as change its pricing model to a more competitively priced one. Apart from that, it can be found that the industry in which the company operates has become highly standardized, especially with the rapid changes in technology. Moreover, there exist a strong competition among the existing companies and thus the marketing strategy is required to be designed likewise in order to have maximum customer attention.

The internal rivalry of this company is high and thus the company is required to look at this part carefully as this is considered as one of the opportunities of the company to explore. However, it has been found that the buyers’ power is low and this part demands proper as well as attractive marketing campaigns, so that the customers get to know a lot about the company along with their products as well as services (Times, 2014). If focus is shed on the performing industry, it can be found that the company is among stiff competition and the competitors are Netflix, Vudu, Hulu and Aamazon.com. Therefore, the strategies of the company are required to be differentiated enough, so that the customers prefer this company to the other companies and this could enhance the business growth of the company easily.

Outlining the ways through which the company gains competitive advantages from international operations

Role of CEOs and executives of the company in leading and positioning of the company for the long-term business

The CEO of Time Warner, Jeffrey Bewkes remarked that, he is confident about the strategy undertaken by his company for Media Corporation. He depicted that the company’s earnings per share over the next several years would be double over next several years (Time Warner Inc., 2016). This shows his potential toward the strategic management of the international business. It has been revealed that, over the last four to five years, the CEO has contributed in the growth of the company at approximately 25% a year compound earnings/ share growth (Time Warner Inc., 2016). From the viewpoint of the CEO, the crucial element of his strategic plan for the company is to affiliate and collection of subscriber support for the network of the company (Hanif & Yunfei, 2013). These are good strategies, as people are watching more videos throughout the world, they are beginning to like it more and they are getting it on demand, and that is a positive sign for the business.

Recommendations of additional strategies for international market

The company is doing well for expanding the business globally (Time Warner Inc., 2016). However, more strategic recommendations will help the organization to expand their business through the global market.

Based on the 2012 annual report of the company, the company should set its goal to continuously expand their brand in international market. The company should begin to acquire or make partnership with cable networks within the emerging markets including Latin America, as there is only one subsidiary that they have in order to cover the total continent. Therefore, the best interest of Time Warner should be to increase the company’s network scope and visibility in the emerging market like Latin America (Mellahi & Frynas, 2015).

The next recommendation would be selling or shutting down the video game sector of Warner Bros. Interactive Entertainment. The entertainment group should find an alternative to its business model for continuous generation of profit in gaming industry.

The company should build on the concept of ‘TV everywhere’. The company had undertaken the initiative in 2009. This idea is simple but customers only have the access of content IF which they have in present (Times, 2014). Therefore, the company can offer interactive applications for specific networks after gaining knowledge about the network users, thereby enhancing their consumer volume.

The company can sign deals with social networking sites for streaming contents and should differentiate their pricing models for the improvements and customer satisfaction in a global range.

Conclusion

In conclusion, it can be said that, Time Warner has established a sustainable position in the industry with the adoption and application of the generic model of globalization. The assignment included the definition of the foreign market entry strategy and how the company has been entered in the international market. The ways by which the company gained strategic competitiveness and benefits in their globalization, the strategies that has been applied by the company for competing in the international market has also been discussed in this study. Finally, some strategic recommendations have been enlisted for further growth and expansion of the company in global market. 

Reference List

Bharadwaj, A., El Sawy, O. A., Pavlou, P. A., & Venkatraman, N. (2013). Digital business strategy: toward a next generation of insights. Mis Quarterly, 37(2), 471-482.

Hanif, M. I., & Yunfei, S. (2013). The role of talent management and HR generic strategies for talent retention. African Journal of Business Management, 7(29), 2827.

Mellahi, K., & Frynas, G. (2015). Global strategic management. Oxford University Press.

Time Warner Inc.. (2016). Timewarner.com. Retrieved 10 March 2016, from https://www.timewarner.com/

Times, L. (2014). Time Warner focuses on its growth strategy for HBO. latimes.com. Retrieved 10 March 2016, from https://www.latimes.com/entertainment/envelope/cotown/la-et-ct-time-warner-hbo-20140923-story.html