Identifying and Choosing Markets

Introduction 

The biggest challenge facing any business enterprise in a perfect competition market structure is the steep competition from the other similar business firms. Thus, if a business firm is to survive in a perfect competition market structure, it must keep readjusting its daily operations in order to keep itself adapted to the dynamics of the global market. Besides, the business enterprise operating in a perfect competition market structure must desire to improve in its areas of efficiency and effectiveness, while trying as much as possible to correct its areas of weaknesses ( Bossink, 2004 ). This article focuses on reviewing and analyzing a case study, “ PPS.tv and China's Online Video Distribution Market,” with the aim of determining the specific direction the PPS.tv may take in order evade the steep competition offered by similar companies in the China’s Online Distribution Market. Thus, the article deploys a critical analysis of information presented about the current state of the PPS.tv; offers effective strategies from current research that guide the PPS.tv to change and adapt to its challenges; and gives a strategic approach to address the stakeholders' needs, leading the business to take the best course of action. 

Critical Analysis of Information Presented About the Current State of the PPS.tv 

Background Information 

PPS.tv is a Chinese peer-to-peer (P2P) online video provider with venture capital backing from Qiming Venture Partners (Anthony et al., 2008). The company offers online video content (user-generated content), such as TV shows, movies, and sports (Anthony et al., 2008). PPS reached its pivotal stage of expansion in January 2008, and hence faced significant pressure in delivering not only profitability, but also developing a large user base (Anthony et al., 2008). In its endeavor to deliver both profitability and a larger user base, PPS.tv has to make a sound decision on the strategy or a combination of multiple strategies applicable in making the PPS take the most sensible direction (Brettel et al., 2011). It is worth to note that PPS.tv is established under a perfect competition kind of market structure; facing competition from more than hundred similar companies in China only (Anthony et al., 2008). Therefore, PPS.tv is an example of companies that have to fight day-in-day-out in order to maintain their relevance in the market place for their survival; now and in the future. 

The Current State of the PPS.tv 

PPS.tv has an estimate of 50 million users in China (Anthony et al., 2008). This translates to less than 5% of the market for video-streaming website services (Anthony et al., 2008). In 2006, the company announced a rise of about 64.7 million video businesses, with an expected rise of 500 million video businesses by the year 2010 (Anthony et al., 2008). The PPS.tv Company faces a challenge of attaining at least 150 users, which will help the company venture into good financial standings capitalists in order to gain its relevance in the highly competitive market. In order to attain the 150 user customers’ thresh-hood, PPS.tv must look for ways of attracting the customers ( Brettel et al., 2011 ). There are three segments that PPS.tv may focus on in order to become more attractive to internet users. 

First, PPS.tv need to work on improving the speed of its video sharing sites ( Bossink, 2004 ). This may be achieved through working extensively with telecom companies that serve the geographical areas of its targeted users. Secondly, PPS.tv needs to aim at improving its viewing experience ( Bossink, 2004 ). This may involve taking measures that ensure that the company share video sites that are up-to-date. Lastly, PPS.tv may attract more and more internet users through availing internet services that offer user community to the customer; considering that Community is an essential part in the Chinese culture (Anthony et al., 2008). For instance, PPS.tv should offer social networking services, such as wikis and forums (Anthony et al., 2008). This could in turn help in attracting youngsters, especially those aged between 16 and 25 years of age. 

However, PPS.tv is facing several challenges that need be addressed in order to remain attractive to dynamics of the customer demands. Its video downloading speed is dependent on its location and computer, which may not be beneficial to the users as a result of extensive downloading for a simple television show (Anthony et al., 2008). PPS.tv has a trouble emanating from the creation of a dependable user base within the confines of the high competitive video market. Besides, PPS.tv is experiencing high rates of piracy and illegal media, where about 90% of the online video content is offered free to public users (Anthony et al., 2008). This means that PPS.tv is facing a great challenge of revenue generation and has to rely on MITs’ G-Lab team for its growth. Thus, the MITs’ G-Lab has been helpful to the PPS.tv Company in offering three different options for its strategic growth. 

One of the options for the PPS.tv strategic growth is focusing on attracting the Chinese advertisers ( Damlan, 2007 ). This is vital strategy in helping the PPS to grow because of the available 50 million Chinese users. However, use of the Chinese advertisers could offer some challenge to the company, especially considering that the Chinese advertiser require significant education in order to meet the online advertisement critic. The second option that the PPS.tv may take in order to expand its growth is international expansion to markets with advanced online advertising industries and/or where users are ready and able to pay for content expenses ( Anthony et al., 2008 ). This could include expansion to neighboring countries, such as the United States, where users are already used to paying for the content ( Damlan, 2007 ). Unfortunately, being based in China, PPS.tv uses a language that is unfamiliar to foreign markets; thus posing yet another great challenge to the PPS.tv growth. Finally, PPS.tv may apply the use of patent PPS’ superior technology in the United States and worldwide, and make money as a technology platform at the international context ( Damlan, 2007 ). This is a vital mitigating factor to the PPS.tv growth, as it offers quality, faster video initialization, and cheaper costs of operation. 

Despite the numerous challenges facing PPS.tv, the company has various areas of strengths. First, PPS.tv enjoys millions of relatively low-profile Chinese Small-to-Medium Enterprises (SMEs) (Anthony et al., 2008). These SMEs are in constant proliferation; hence stand as potential attractive segments for PPS.tv growth. The second area of the PPS.tv success is that the company provides the Chinese Internet consumers with professionally-produced online video content, such as movies, sports, and TV shows, freely; a step that enables the company to evade the crowding of more than 100 Chinese based internet producing companies (Anthony et al., 2008). This enables PPS.tv to maintain its competitive ability in the China’s online business. 

Another area of the PPS.tv strength is that PPS.tv offers faster and extensive technology; that enables the company to successfully compete in the China’s online video space (Anthony et al., 2008). In fact, statistics show that the company’s operation cost is nearly four times those of the United States (Anthony et al., 2008). The company has also been offering high quality internet videos to Chinese; thus making it competitive in the market. Finally, the PPS.tv Company has technical engineers who develop proprietary streaming software, offering content distributors with complete suite of services (Anthony et al., 2008). The content distributors include video on demand network solution, P2P speed-up, and content distribution. The suite offers the company three core competitive advantages, namely; low costs of operation, superb user experience, and comprehensive multimedia format support. 

Effective Strategies from Current Research That Guide the PPS.tv to Change and Adapt To Its Challenges 

Main Challenges Facing PPS.tv 

Like any other online video provider, PPS.tv faces several challenges, most of which accrue from the fast changing technology and the dynamics of the global market demand. One of the main challenges facing the PPS.tv is the high demand for multi-screen and multichannel distribution ( Bludov, 2018 ). Many customers demand that media companies avail their content over multiple video streaming devices as well as multiple platforms ( Bludov, 2018 ). This translates to increased cost of production for the video streaming companies. Unfortunately, most consumers tend to watch videos of their convenience; thus they prefer watching videos that are easy to access to their content at their convenient places, at their appropriate time, and at affordable cost. This means that online video providers, such as PPS.tv must keep their content available in multiple-screen, multichannel, and easy to access at customers’ convenient costs. Consequently, PPS.tv must adhere to all these customer demands in order to remain competitive in the China's Online Video Distribution Market (Alam, 2005). The outcome is that PPS.tv incurs a lot of production cost, while gaining little profit from its services. 

Another challenge facing PPS.tv is the difficulties in keeping data security and protecting user privacy (Bludov, 2018). The world of video streaming is engulfed by unending and untimely piracy. Thus, online video providers like PPS.tv must always keep their content highly protected from piracy at all-time. This means that PPS.tv has to undergo unnecessary cost in trying to protect its video content from piracy. Besides, the world of digital is made of professional digital pirates who constantly hack and store the video content in their computers even before the official release of the content. Therefore, it proves quite difficult to counteract piracy in online video providers, and this leads to great loss to the company. Lack of accurate data is another challenge facing PPS.tv and any other online video provider (Bludov, 2018). This is because it is quite difficult to accurately track video viewership, especially in the complicated current ecosystem; which has massive gaps in data collection (Bludov, 2018). Therefore, it is pretty hard to for PPS.tv to keep accurate data of its viewers and this may sometimes lead to great losses to the company. 

Effective Strategies That PPS.tv May Apply To Change and Adapt To Its Key Challenges 

The best strategy that PPS.tv may undertake in order to grow and survive the dynamics of the China's Online Video Distribution Market is simply to bank on its areas of strengths while working to improve on its areas of weaknesses. In this regard, this article discusses areas in which PPS.tv needs to focus on in order to keep itself relevant and competitive in the China's Online Video Distribution Market. These include growth and scale, performance, content delivery, geographical reach, and internal resource constraints. 

Growth and Scale 

This paper has established that one of the biggest challenges facing any online video provider is the high demand for multi-screen and multichannel distribution. This is because multi-screen and multichannel distribution is relatively expensive and if applied it may increase the cost of production. However, PPS.tv may use the opportunity and use its private network to expand its services to global capacity (Russell, 2018). This is vital as it will enable the company realize dramatic improvements for growth and scale (Russell, 2018). In this way, PPS.tv may deploy the idea of replicating its content delivery network (CDN) to popular content in several locations near the edges of the network (Russell, 2018). This will be beneficial to the company, as it makes the use of the advantages of the economies of scale (Russell, 2018). Therefore, by expanding its growth and scale of production, PPS.tv may quickly adapt to the demands of the China's Online Video Distribution Market. 

Performance 

One way of attracting and maintaining customers in any business enterprise operating under a perfect competition market structure is business’s ability to offer high-quality experience to its end products users (Russell, 2018). PPS.tv, being an example of a service provider within a perfect competition market, therefore, must endeavor to offer high-quality services to its customer. This means that PPS.tv should anticipate offering fast start of video playback, consistent high image quality and frame rate, and eliminate rebuffers in its online video distribution (Russell, 2018). This is achievable through layering strong network infrastructure that is capable of supporting fast delivery of both static and dynamic content (Russell, 2018). Although this may be costly to the company, the end results is that the company will stand a better chance of attracting a large number of users, and hence enjoy high levels of profit returns. 

Content Delivery 

Another way in which PPS.tv may become more competitive in the China's Online Video Distribution Market is through ensuring that its content is available to every device within the customers’ reach (Russell, 2018). Offering content delivery to any device may be achieved through PPS.tv looking to work with a network that provides device-specific benefits on a user-by-user and session-by-session basis ( Russell, 2018 ). Making content available for delivery by any device is vital, as it further helps to foster customer attraction and maintenance; hence the company enjoys a wide variety of users. 

Geographical Reach 

Online video providers face a great challenge in trying to reach a wide range of geographical locations (Russell, 2018). This is because the quality of streaming reduces with increase in distance from the streaming site (Russell, 2018). However, PPS.tv may overcome the challenge posed by geographical reach through working with global middle-mile networks (Russell, 2018). Global middle-mile networks have the ability to invest in worldwide infrastructure, hence are capable of solving the geographical challenges (Russell, 2018). Being able to reach a wide range of geographical locations is vital to PPS.tv because the idea will enable the company expand its customers and become more and more competitive within the China’s Online Distribution Market and the global world at large. 

Internal Resource Constraints 

The final challenge that PPS.tv Company needs to overcome in order to survive within the competitive China’s Online Distribution Market is the internal resource constraints. This means that the company needs to hire managers who are highly skilled and experienced in the online video distribution industry (Russell, 2018). Besides, PPS.tv company needs to bank on talented workforce that is capable of coming up with new innovations in order to meet the changing customer demands within the China’s Online Distribution Market (Russell, 2018). Therefore, by hiring the right personnel in the PPS.tv Company, the company will be able to overcome its internal resource constraints and be able to offer strong network that is able to give top-notch scale, reach, and performance; and be able to survive the steep competition offered by other online video providers within the China’s Online Distribution Market. 

Strategic Approach to Address the PPS.tv Stakeholders' Needs, Leading the Business to Take the Best Course of Action 

Besides staging strategic ways to overcome its key challenges in its venture in the China’s Online Distribution Market, PPS.tv also needs to lay down strategic approach aimed at addressing the needs of its stakeholders in order to generate a culture that fosters productivity and profitability within the organization. This includes meeting the needs of the PPS.tv CEOs, the managers, all the junior staff, and the customers. 

Understanding Customers 

The first strategic step that PPS.tv needs to undertake is to aim at understanding its customers and their respective needs (Alam, 2005). This is vital as it helps the company to develop a well-framework of operation aimed at meeting the customer satisfaction and hence attract and maintain them. One way of understanding customers is through application of intelligent customer engagement (Alam, 2005). This may involve taking steps, such as collecting customer insights through observation of customer patterns and their choice and preferences (Alam, 2005). This helps to foster customer satisfaction through meeting their desires. 

Another way of understanding customers is through generation of customer analytics data (Alam, 2005). This may be achieved through observing how customers interact with the company’s website (Alam, 2005). This helps the company to predict the customer behaviors regarding their likes and dislikes of the company and hence enable the company adjust its service provisions accordingly. In addition, PPS.tv may understand its customers through traversing the customers’ path (Alam, 2005). This may mean that the managers and other stakeholders should put themselves into the shoes of the customers through the customer journey mapping (Alam, 2005). This technique is crucial as it facilitates the interaction between the service providers and the service consumers before, during, and after the purchasing process (Alam, 2005). In general, understanding the customer behaviors towards PPS.tv’s brand is vital because it helps the company know its level of customer satisfaction and make the necessary readjustments of its systems in order to maintain high level of customer satisfaction and boost the company’s competitive ability in the China’s Online Distribution Market. 

Addressing the Needs of the PPS.tv Staff 

Meeting the needs of the company’s staff is a key driver towards customer satisfaction (Bendjenna, Charre, & Zarour, 2012). This is because a happy staff remains committed to their respective duties and hence offer the best of their services (Bendjenna, Charre, & Zarour, 2012). Therefore, for PPS.tv to remain relevant within the competitive China’s Online Distribution Market, it must leverage strategies aimed at addressing fully its staff needs. 

First, PPS.tv should create a culture that promotes transparency and feedback (Bendjenna, Charre, & Zarour, 2012). The managers should be ready to admit when something is amiss and invoke all the stakeholders to act towards fixing a long-lasting solution in time. The company should promote a culture that fosters learning and innovation (Nadal et al., 2015). Besides, the culture should accommodate all the needs of the involved parties and promote the sharing of ideas (Nadal et al., 2015). This helps to keep every employee feel part of the company and have incentives in committing themselves fully in offering optimum services to the company; thus making the company more productive and competitive within the China’s Online Distribution Market. 

Secondly, PPS.tv should develop a culture that embraces appreciation of the staff’s good work (Majava, 2014). This may involve recognizing hardworking employees through salary increment, offering prizes and gifts, and promotions. This helps to motivate the employees to remain committed to their duties and prevent them from searching for greener pastures elsewhere (Majava, 2014). This means that by appreciating its employees, PPS.tv will foster its ability to offer quality services to its customers, and consequently improve its competitive ability within the China’s Online Distribution Market and be able to thrive, now and in the future. 

Conclusion 

PPS.tv is a Chinese peer-to-peer (P2P) online video provider that is struggling to survive steep competition from other online video providers within the China’s Online Distribution Market. This paper has established that PPS.tv may best succeed within the competitive China’s Online Distribution Market through simply banking on its areas of efficiency and effectiveness while trying as much as possible to correct its areas of weaknesses. Thus, PPS.tv should improve on its growth and scale, performance, content delivery, geographical reach, and minimize its internal resource constraints. Besides, the company should endeavor to improve its customer satisfaction through understanding and addressing both the needs of its customers and those of its staff. Therefore, PPS.tv stands a high chance of raising its competitive ability and hence it can thrive excellently within the confines of the high competitive China’s Online Distribution Market. 

References 

Alam, I. (2005). Interacting With Customers in the New Product Development Process. In: Kahn KB (Ed) the PDMA Handbook of New Product Development: New Jersey, John Wiley & Sons: 249–262. 

Anthony, K., Chen, R.E., Rackoff, A., & Wong, W.Y. (2008). PPS.tv and China's Online Video Distribution Market. 1-12. 

Bendjenna, H., Charre, P., & Zarour, NE. (2012). Using Multi-Criteria Analysis To Prioritize Stakeholders: Journal Of Systems And Information Technology. 14(3): 264–280. 

Bludov, S. (2018). Video Distribution: Challenges and Opportunities in an Unknown Future. (Online).Retrieved from https://hackernoon.com/video-distribution-challenges-and-opportunities-in-an-unknown-future-8973ba47b796 

Bossink BAG. (2004). Managing Drivers of Innovation in Construction Networks. J Constr Eng Manage. 130(3): 337–345. 

Brettel, M., Heinemann, F., Engelen, A., & Neubauer, S. (2011). Cross-Functional Integration of R&D, Marketing, and Manufacturing in Radical and Incremental Product Innovations and Its Effects on Project Effectiveness and Efficiency: J Prod Innovation Manage. 28(2): 251–269. 

Damlan, D. (2007). Stakeholders In Global Requirements Engineering: Lessons Learned From Practice. IEEE Software. 24(2): 21–27. 

Majava, J. (2014). Product Development: Drivers, Stakeholders, and Customer Representation during Early Development:1-80. 

Nadal, C.T., Mañas, G.P., Bernadó, B.S., & Mora, C.A. (2015). Assessing Teamwork Competence. 27(4): 354-361. 

Russell, C. (2018). The 5 Biggest Challenges with Online Content and How to Deliver Top-Notch Experiences. (Online).Retrieved from http://www.econtentmag.com/Articles/Editorial/Industry-Insights/The-5-Biggest-Challenges-with-Online-Content-and-How-to-Deliver-Top-Notch-Experiences-125684.htm