In: Economics
Name a product that you regularly purchase from a firm that operates in an oligopolistic industry. Explain why the product and firm fit the model of oligopoly. Think about the TV commercials and/or print advertisements that you’ve seen from this industry: What interdependence have you noticed between the firm you selected and its rivals in terms of product differentiation, price leadership, or price competition? Make sure to include a link to support your contribution such as an advertisement or document.
A product that I regularly purchase from a firm that operates in an oligopolistic industry is online viewership such as Netflix, Amazon and Disney +. Thus this industry is oligopolistic because only few firms are prevalent in this and there are several barriers to entry as broadcasting rights are bought by the firms in the industry. Thus it fits the model of oligopoly because all these firms sell identical products which are slightly differentiated and the three players hold majority of the market share.
Interdependence between the firms in the case of Netflix has been in terms of the genre and the themes they broadcast, thus when Amazon tries to product a serial based on crime and it is a huge success, even Netflix will try to come out with the same theme but a different storyline. In terms of pricing Netflix is priced at $9/month, and Amazon is at $8.99/ month, thus both of them start at the same price range. While Disney is priced at $6.99/ month. Thus Netflix and Amazon are priced at almost the same price range which showcases that they tend to go for non-price competition. Additionally they will try to give entertainment along the same time frame and short seasons, which showcases a lot of interdependence between them and specific trageting of the audience.
Disney Plus app, price, bundles and all the shows and movies - What Hi-Fi.