What are the strengths and weaknesses of Brightcove’s business model?
The Strengths of the Brightcove’s business model are the following:
• A comprehensive designed business model that covers different players such as Publishers, Consumer,Advertisers, and Affiliates and places Brightcove on the center of all the players.
• A sophisticated pricing model that enables Brightcove to get revenues from all the different sides of this system.
• It requires a strong technical infrastructure that allows Brightcove to take advantage of its in-house talent in technology.
• This concept, on of its sides, targets the long tail of video content, which has proved to be a key success factor to other companies such a Netflix and Amazon.
• This business model allows providing advertiser with specific target audiences, which are considered premium audiences and drive top revenues.
The Weaknesses of the Brightcove’s business model are the following:
• This concept is not difficult to imitate. In fact, with $750k investment and 10 month of development could be replicated. Thus, this model is not a source of sustainable advantage for Brightcove.
• Many premium content publishers are not willing to trade control for 50% share of advertising revenue. They want to have full control of their content and benefit from any profit generated by their content.
• Brightcove is not able to define clearly who the targeted market should be among publishers.
• It has many strong competitors that are running part of this model successfully and have the first mover advantage.
• It might have “the penguin problem”. For instance, advertisers will not make their first move if consumers have not moved, and, on the same way, publishers will not be attracted to this platform if advertisers are not in. Consumers will likely be attracted once they have variety on video content.
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