Pros And Cons Of Vertical Integration

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Internet TV allows apps such as, Netflix, You Tube, and Hulu to build large scale direct-to-consumer services. In order for Netflix to be viable in the future I have prepared a list of pros and cons related to various integration options that Netflix could pursue. Redbox has achieved phenomenal sales growth” (Ferrell & Hartline, 2014). Netflix must implement new strategies to combat Redbox’s phenomenal sales. Pros of vertical integration will eliminate the dependence on movie studios for getting licenses. “In each market, we license content from multiple suppliers, mirroring the fragmentation of the content industry” (Seward, 2014). It means that Netflix will be able to reduce its cost of operation in few years and as a result offer lower prices

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