Research on organizations started during the early 1950s. These early studies mainly focused on the importance of a better understanding of the broader macro – and micro-environment that a company operates. The single factor within the PEST analysis that will affect Netflix is the social factors on culture and diversity. Rodborough, S. & Rittman (2018) mention that Netflix stands at the height of undertaking a significant and revolutionizing move of having a local dialect software for replacing the subtitle options. Through this software, Netflix can tap into the demands of international customers.
According to Burroughs (2019), Netflix will also own rights to such projects and control other companies in the market. This technology change will significantly improve this firm’s competitive position. The technology will also mean reduced production costs, improvement of the existing programs, and new strategic groups.
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Per capita, disposable income will determine the ability of an individual to purchase services or goods. It is calculating by adding the income earned from different sources. Sources can be from government transfers, rental incomes, or wages. Then there is the deduction of taxes, savings, and tax payments, and divided by the United States' total population.
Herbert (2019) points out that the political factor is another challenge that Netflix needs to address. For example, the restrictions to venture into the Chinese marketplace. The government’s attitude towards the industry affects the overall regulatory climate for Netflix to venture into the vast Chinese market. Indeed, PEST analysis is a standard method of analyzing and identifying the external factors that are likely to affect a business. After identifying these aspects, they can be assessed to establish the possible impact they may have on the company’s future.
References
Burroughs, B. (2019). House of Netflix: Streaming media and digital lore. Popular Communication , 17 (1), 1-17.
Herbert, D., Lots, A. D., & Marshall, L. (2019). Approaching media industries comparatively: A case study of streaming. International Journal of Cultural Studies , 22 (3), 349-366.
Rodborough, S. & Rittman, A. (2018, Apr. 16). As Netflix goes global, can it avoid regional politics? The Hollywood Reporter . [Online]. https://www.hollywoodreporter.com/news/as-netflix-goes-global-can-it-avoid-regional-politics-1102121 (accessed 2021, Jan. 16).
