Class 03. Flashcards
industry analysis (value creation vs value capture)
1
Q
why are some companies sustainably profitable and others not?
A
firm decisions + industry dynamics
2
Q
what are forces against sustainable profitability?
A
competition + supplier/buyer power
3
Q
what is value capture?
A
fraction of value creation captured
4
Q
what is value creation?
A
total value (buyer’s WTP - costs)
5
Q
what impacts a buyer’s WTP?
A
competition, demand, need, etc.
6
Q
how is the music industry performing poorly?
A
little value captured by artists
7
Q
how is the music industry performing well?
A
easier to create + distribute music than the past
8
Q
what are key players in the music industry?
A
- songwriter
- artist
- record label
- publisher
- venue
- distributor
9
Q
why are artists’ value capture low?
A
- power dynamics
- money is power
- industry politics
- ignorance
