Strategic Management in Action: assess the level of current rivalry in this industry, its importance and changes.

Read Strategic Management in Action: "E-books and Readers”

a. Using the eight conditions, assess the level of current rivalry in this industry.

b. Which of these eight conditions do you think are the most important to the level of current rivalry in this industry? Explain your rationale.

c. As the industry matures, do you think the intensity of rivalry will change? Explain.

The rise in the legacy of digital technology it has largely affected in the publishing industry as large number of people are shifted towards published books to the e-books. The nature of book readers have shifted from published books to the e-books. Raising in such trend of e-book readers this has given fierce competition to those companies who manufactures the e-book reading devices such as tabs, tablets etc. Amazon started its first device named Kindle in the year 2007 and after that other different manufactures such as Barnes & Noble, Apple, Sony Reader etc. are competing in the present market.

a.Using the eight conditions, asses the level of current rivalry in this industry.

1. ·Numerous or equally balanced competitors: As the E-Book readers are increasing day by day and the demand for such reading device is increasing , there exist high competition among the competitors in which each of them will think of getting competitive advantages. This sort of intention will give the momentum to the competitive environment.       
2. ·Slow Industry growth: As the given industry is growing so no need to worry for this industry but in case of slow industry growth people will tend to choose for low cost devices rather than higher cost and even the customers will look for the value of price factor.
3. ·High fixed or storage cost: As few products in this industry is relatively higher than the rest of the competitor still the product is doing good this means for rest of the competitors the pressure is on themselves to sell their products.
4. ·Lack of differentiation or switching costs: in the given industry the products are similar in nature few of the products are totally targeted to the e-book readers such as Amazon's Kindle and Barnes and Noble's Nook are similar and Apple's ipad was little bit different from rest of the product so sales of ipad was better though it has got high price which led rest of competitor to took down their prices which means when your product is not different then people tend to look after the price and services.
5. ·Addition of capacity in large increments: when the e-readers are large in number so the industry has to produce in large quantities as well as the services should be added so that large number of customers can be attracted towards the product but in case of any turmoil it will be burden for the industry.
6. ·Diverse Industry: Being in a similar industry it doesn't mean each of the component will act similar in all situation. Though there is various competitors with lower price Apple kept its product's price high which shows the strategically different approach of the Apple.
7. ·High strategic stakes: Apple is going aggressively with its product so no matter how good they are performing they tend to go even higher because of various reasons. In this industry this sort of aggressiveness cannot be seen so its competitive position is low in terms of high strategic stakes.
8. ·High exit barriers: In this e-paper reading device industry also no matter how bad the competitors are performing they tend to go even big due to various reasons may be due to pride and honor. For e.g. Amazon kept their first hand in this reading device industry so they may not tend to exit from this market no matter how bad they will perform due to their pride of first mover in this field.

b.Which of these eight conditions do you think are the most important to the level of current rivalry in this industry? Why?

Among the eight conditions I think the most important conditions to the level of current rivalry in this industry is numerous or equally balanced competitors as Numerous or equally balanced competitors which means the given industry of reading device have got similar balanced competitors. They all produce similar product, in such scenario each and every manufacturers tends to take competitive actions in order to take competitive advantages. In such scenario if one takes any action rest will also follow them. This in given industry numerous or equally balanced competitor is most important.

c.As the industry matures, do you think the intensity of rivalry will change? Explain?

As the last line of the given industry quotes as the popularity of e-books continues to grow, the” reader wars” are likely to continue which means rivalry will be continue till its maturity. Till the maturity the low performing brands will be abolished from the market and the product having higher value and competitive price will remain in the market. And as the industry matures the intensity of rivalry will be low in comparison to its growth stages which mean there will fewer products and fewer customers and the demand for such product will be relatively lower which led the low intensity of rivalry among the industry key players.

References

Coulter. (2013). Strategy Management. Prentice Hall.