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Competitive Dynamic & Rivalry

In 2011/2012

Haris Suhendra1140003494

BINUS BUSINESS SCHOOL

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Table of Contents

• Overview

• Analysis on external environment

• Analysis on target company’s internal environment

• Competitive strategic movements analysis

• Review of TV One’s past/current competitive strateg(ies)

• Conclusion & recommendation:

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Overview

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Objective

• To view the competition landscape in TV Media industry, especially in TV news segment.

• Used as an evaluation TV One strategy movement to win the competition.

• Creating a strategic competitive movements TV One via internal strength, resources and capabilities.

• The use of attack strategic movement to win the competition.

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Scope of work

• To discuss about TV media industry in Indonesia and the competitive landscape TV News segment.

• To discuss about TV One as a market leader in TV news Segment . • To discuss about TV One’s Competitor. • Period : 2011/2012.• Methodology :

– In collecting the data : interviews, library, internet, media such as magazines, newspapers, TV and various other sources such as journals and publications.

– PESTEL Analysis, Porter's Five Force Analysis, Strategic Group Analysis. Theory of Value Chain (Porter). Strategies of key industry players, SWOT analysis. Attack strategic movement approach.

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Journey Of TV One’s Life

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VIVA Group

TV One

Ownership

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Analysis on external environment

Macro-environment

The power to control the media, seems to have become the power to also control policy and media law, hence confirming the regulation is more oriented towards group interests rather than public interests.

Indonesia's economic growth is expected to continue to grow by 6-7% per year in the 5 (five) years.

social networking/ social media has opened the space without limits for people to communicate.

There is gap in access to conventional media such as television, are still hard to come by people living in remote and underdeveloped areas.

Development of Media Digitization has given new challenges

One of the regulations that have changed the face of media in Indonesia is the UU No. 32/2002 which brought a wave of new freedoms and democratic spirit of the media.

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Porter's Five Forces in National Media TV Industry in 2011/2012

Threat of entry is LOW

the bargaining power of supplier is LOW

The bargaining power of buyer in the industry

is High

The threat of substitute product in the industry

is medium

The intensity of competition is high

This is partly due to the severity of the barriers to entry that must be taken such as capital requirements, economies of scale, and government regulations regarding the conduct of a network television station broadcasting system which will be implemented in the near future.

in-house production, one of strategy to reduce the cost of production. The other advantage players can design budget TV coverage more planned and controlled.

online media, radio, digital media

This is because a lot of media agency holding the funds accumulated large amounts of ad spending. The bargaining power of a multinational media specialist is very big because they have a fund huge ad spending.

The growing national TV, local TV and pay TV business has changed the competitive landscape in the

Media TV industry in general.

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Source : KPI 2007-2011

Year Public TV Private TV Community TV Pay TV Total 2007 0 3 0 5 82008 0 29 0 2 312009 0 24 1 9 442010 0 28 0 12 402011 1 31 0 15 50

Competition Number of Media TV in Indonesia

List of Group of Media in Indonesia

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Key Players - Positioning

No. TV Players Market Share Main Content Group

1 RCTI 17% Sinetron, Commedy MNC Group

2 SCTV 16% Sinetron, Drama EMTEK Group

3 Trans TV 14% Variety Show, sinetron, Commedy

CT Group

4 MNC TV 12% Religion Drama, Local Music MNC Group

5 Trans 7 10% Sport, reality show, News CT Group

6 Indosiar Visual Mandiri

10% Sinetron, Drama, Reality Show EMTEK Group

7 Global TV 8% Nickeledeon, F-1 Racing, MTV MNC Group

8 ANTV 7% Lifestyle, family entertainment, sport

Visi Media Asia

9 TV One 5% News, Sport Visi Media Asia

10 Metro TV 3% News, Sport, Documenter Media Group

Market Share FTA (Free-to-Air in Indonesia : 2012.

Source : MPA analysis (2011)

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Strategy Group Mapping

Sharpness From the Metro TV news Sharpness superior to TV One. If the news was observed in Metro TV completely objective in assessing the rumors circulating in the community.

ProgramsTV One time is superior because it has a spectacular programs such as Indonesia Lawyers Club.

Update Metro TV more often be the first to know the news and immediately becomes breaking news. When the news is really important and breaking news, they unmitigated expense of another event for the most up to date news constantly. Meanwhile, TV One, more often concerned with events that already exist.

Reliable TV one is still struggling from the Metro TV. The level of public confidence in both the TV is still emphasis on Metro TV.

News Anchor Its very important we need to observe is News Anchor. TV One still has much to learn how to set up the News Anchor to be more professional in front of the camera.

Picture Metro TV picture quality is better than on TV One.

TV One

Metro TV

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Industry trends and developments.• The Competition of Indonesia's media industry is very dynamic. Media continues to be an

integral part of human life, and therefore the development of the media industry has always been important to the community.

• Over time, local TV began to take a share of a national TV audience, up from an average of 2.1% in 2005 to 3.2% of the total number of viewers in 2008 - but subsequently dropped to 2.5% in 2010.

• One thing that can be seen clearly is that the local television stations were difficult to endure, and the number of local television stations and other media channels have declined due to their inability to compete in the business media. Among the factors contributing to this situation is the human resources and capital: most local stations did not have factor of these factors to maintain its business, so in the end they were taken over by groups larger media.

• 21% of the total duration of broadcast television to reach 23.760 hours or approximately 4.996 hours. This number is larger than most other programs, such as entertainment (19%), movies (16%), information (14%) or serial (12%), mainly due to the contribution Metro TV news programs and TV One (nearly 50% of the total broadcast news) (Nielsen,2010).

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Market Trend

Local TV and National TV Market Share in Indonesia (2005-2010)

Source : Nielsen (2011 b:2-3)

The number of households with television (2011)

Source : Kominfo 2011

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Analysis on TV One’s internal environment

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Internal Capabilities

Tangible asset Intangible asset Financial 88% profit contribute to Viva Group Reputations & Recognition

Good Brand Positioning : TV One in a short time has become a news station number 1 in Indonesia with news coverage

Physical 31 tvOne transmissionstations so as to reach 170 cities and districts in Indonesia with 143 million inhabitants.

Human Capital Composition of Human Resources Supported by more than 2,690 professionals that consist of 2,205 permanent employees and 485 outsourced employees. There are 2,121 male workers and 569 female workers. The demographics of employees according to education, age, and their position are shown in the following diagrams.

“Bakrie Learning Center” dan “KampusOne”

Organizational TV One is owned by the Bakrie Group's business venture, PT Visi Media Asia, which also operates “ANTV" and vivanews.com news portal.

Resources

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TV One’s Coverage

Source : Annual Report Viva Group (2011)

31 tvOne transmissionstations so as to reach 170 cities and districts in

Indonesia with 143 million inhabitants.

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Capabilities

• TV One program dominated by news programs, current affairs, talk shows, documentaries and sports.

• TV One utilizing mapping program to develop patterns and scheduling events that match the tastes of viewers, by implementing strategies “Strip programming" where programs with similar genre published during a certain period.

• Some excellent programs during 2011, which are: Spot News, World Boxing, News, Jakarta Lawyers Club (JLC) (Now known as Indonesia Lawyers Club (ILC)), models, Stories From Across, the Name of the People, evening news, “Apa Kabar Indonesia Malam”, Operation Target and others.

• Purchase licenses from overseas : BBC Worldwide Limited, Associated Press Television News Limited, Reuters and others.

• Will continue to cooperate with official sources Reuters international news content on the air for 24 (twenty four) hours per day.

• With the span of time of continuous broadcasting, the TV One continues to make broadcast programming event patterns that present the information accurately and quickly.

• Procedures and mechanisms for planning, scheduling program event patterns based on the rating and target revenue while maintaining the element of cost efficiency.

• TV One has increased the number of in-house production of 53% in 2008 to 86% at the end of the year 2011.

• Addition to the production inhouse, for certain programs acquired through the acquisition of non-news content and news from various production houses and distributors of leading through a rigorous selection process.

TV One’s Value Chain Analysis

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86 % In-house production

Outsource

Broadcast TV

Cable Network

Broadcast TV Station

Cable TV

Pay TV

Internet

TV

Laptop/ PC

Mobile Device

Website

Viewers/ Consumer

News programs, current affairs, talk shows, documentaries and sports

selectively purchase licenses from overseas for a credible news content and can attract the attention of viewers, such as BBC Worldwide Limited, Associated Press Television News Limited, Reuters and others.

31 tvOne transmissionstations so as to reach 170 cities and districts inIndonesia

TV One Channel www.tvone.co.id

143 million Viewer (2011).

24 hours

Local Contributors (news bureau) : Surabaya, Medan and Makassar Foreign Contributor (news agencies) : APTN, SNTV, Reuters , VOA, and others.

Outside broadcasting van ("OBvan").3G facility tvOne Satellite News Gathering (SNG) that uses the Global System for Mobile Communications (GSM) to direct the news coverage (live). TV One renting satellite with 12MHz bandwidth in satellite owned by Indosat.

Content Creation Content Packaging

Content Distribution

User Interface End user

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Competitive strategic movements analysis: Strategies of key industry players (2011/2012)

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SWOT Matrix analysis

EF/IF

Strength Has exciting programs. Supported by SDM (reporters and

editors) are professional Use of Information Technology (IT) are

modern. Modern broadcasting production facilities Has a wider network television coverage. Supported by strong financial (Viva

Groups).

Weakness• Product service similar to the first competitor

to dominate the market (Metro TV).• News is presented almost as a competitor.• The low quality of the news

Opportunities Cultural watching TV in the

community are still high Community needs to get news /

information is constantly increasing with the speed that information.

freedom of the press in covering the news / information to the public.

Strength – Opportunity • Increasing market share.• Increasing Brand Equity.

Weakness – Opportunity Creating innovative event

programs. Improving the quality of

reporting.

Threats• Convergence and digitizing

media• The growing number of local TV

area.• Low interest of society to news

programs.• Regulations are still in favor of

the media conglomerate.

Strength – Threats Pursuing a strategy of

digitization of media Giving discounts to

advertisers.

Weakness – Treats The involvement of the

community in presenting the news

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Strategic Movement : TV One’s frontal attack (2011/2012)

Rules of follow in a frontal attack TV One Metro TV

Only industry segment TV News Segment TV News SegmentOnly one competitor Metro TV TV OneAct Upon only one competitor weakness

Metro TV does not have a spectacular program

The quality of TV One’s program not good

Be sure you have advantage over the competitor weakness

Having a spectacular program The Quality of Program Excellence

Achive surprise Market Share is greater than Metro TV

As the pioneer of the first in TV news segment

Speed (deploy resources ad a fast pace)

With the "Berita Terkini" Program as presents live coverage against unforeseen events.

Being the first in Indonesia TV News serving news quickly through the "headline news", presented accurately and reliably.

Leave escape route to the competitor

Cooperation Innovation

Is the segment worth it? Increase number of market share and advertiser.

Increase number of market share and advertiser.

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Review of TV One’s past/current competitive strateg(ies)

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Review of TV One’s past/current competitive strateg(ies)

Innovation Partnership Leadership & Culture

Quality & Coverage

To improve efficiency People Profit

Focus on news programs

Held 24 hours a day

To differentiate impressions, TV One trying to display a lighter news.

Some excellent & Unique program programs : Produces a talk show with a studio lobby & Indonesia's Lawyer Club Program.

Purchase licenses from overseas : BBC Worldwide Limited, Associated Press Television News Limited, Reuters and others

Local Contributors : Surabaya, Medan and Makassar

Foreign correspondence (news agencies) : APTN, SNTV, Reuters , VOA, and others.

Commitment to the implementation ofGood Corporate Governance (GCG)

“tvOne Satu Untuk Negeri”

commitment to help and assistfellow indonesians who fell victims to natural disastersin various regions of the country

Building 37 transmitters throughout Indonesia,

Technology Development : broadcasting equipment outside broadcasting van ("OBvan") & 3G facility tvOne Satellite News Gathering (SNG) that uses the Global System for Mobile Communications (GSM) to direct the news coverage (live).

Consolidating & Synergy with ANTV & Vivanews.com in VIVA Group.

TV has increased the number of in-house production of 53% in 2008 to 86% at the end of the year 2011.

the acquisition of non-news content and news from various production houses and distributors of leading through a rigorous selection process.

“Bakrie Learning Center” dan “KampusOne”

Organized 13 training sessions for employees including Digital Trends, TV Audience Trends,Rethinking Efficiency and Effectiveness in Ad Placement,a Seminar for Leading Indonesian Journalists,International Affairs Analysts and others, reaching 33participants, also with resource persons competent intheir fields, among others: AGB Nielsen Media Researchand CNN Journalism Fellowship.

Conducting the process of expanding access to broadcast and production process is commercialized

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Conclusion & Recommendations

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Conclusion & Recommendations

• Creating innovative event programs.• Improving the quality of reporting.• Pursuing a strategy of convergence and digitization of media.• The involvement of the community in presenting the news.• Refrain from imaging patterns and vehicle mounts for the

benefit of the group. • Partiality the truth and the principles that are necessary and

should be maintained and continue as the primary basis evoke the news as a commodity in the community television.

• Establish an independent human being through the preaching mounts away from imaging devices, which tend to lie and deceive the public on the truth.

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thx