BusinessDay 25 Oct 2017

More documents

Recommendations

Info

Wednesday 25 October 2017 28 BUSINESS DAY Leadership SHAPING PEOPLE INTO A TEAM Netflix and Why the Future of Streaming Looks Like Old-School TV JOSHUA GANS Netflix hit the industry with some bombshell moves this month. First, it announced that it plans to spend $8 billion on original content next year (including on 80 new movies). This is far more than any other online player. Obviously, this is great news for Netflix’s 100 million-odd customers worldwide. What isn’t so great for its customers is the other news. Netflix will raise the price of its standard plan by $1 a month and its premium plan by $2 a month. With these increases the company is slowly edging toward the $15-a-month plan offered by its competitor HBO. This means that Netflix isn’t just your Blockbuster replacement anymore. Makers of original content — including the likes of Disney — are moving away from Netflix. Instead, Netflix looks like an old-school TV network. If you had to predict what the industry will look like in five years, you might say that there will be a set of online channels with the expectation that consumers will subscribe to all or most of them. At $15 a month each, consumers will likely sign up for four or five of these channels instead of a normal monthly cable bill. Netflix is investing to be the “must subscribe” channel in that world. There are obvious differences between the new TV industry and the old. On-demand is one difference, as is Netflix’s “born global” approach. This makes it easier to do what Netflix was built for: experiment with the long tail rather than go for mass-market hits. While it might be inconceivable for an old-style network to greenlight a series that appeals to just 0.5% of its viewers, for Netflix, if that series is the reason that 0.5% choose to subscribe, that’s enough to justify the investment. One great feature of subscriber revenue is that it makes life very comfortable. As Netflix contemplated its $1-a-month rise, I would guess board members had an easy time calculating in their heads the extra $100 million a month, or $1.2 billion a year, that would bring in. And they had every reason to believe that growth would continue, as subscribers are quite sticky. Netflix looks a lot less significant on people’s credit card statements than the traditional cable bill. Small amounts like that can go unnoticed for years. A little while c ago, a professor colleague of mine recounted that in finally reviewing a credit card statement, he noticed a recurring AOL charge. He must have signed up for it a decade or more ago and forgotten to cancel! Subscriber revenue is nice, but it has a flip side. When your business has reached its peak, letting it go can be hard. This is precisely the challenge that old networks and cable TV are facing. To be sure, every person and his dog can see where the industry is going. But if networks and cable were to jump to online and on-demand right now, that would only increase the number of people cutting the cord. The drive to hang on another year or two and wring more from those sticky customers is just too tempting. Netflix is banking on that happening. And if Netflix is right, it won’t end well for the old guard. When the traditional players really start to struggle, Netflix and others will be able to scoop up all that old content for a song. That said, Netflix has its own flip side to deal with. I have a kid in college who still uses my Netflix account. There’s certainly no economic reason for me to cut the parental cord now, but looking ahead, I don’t see when it will ever happen. I have vague hopes that at some point my kid might be embarrassed to still be on a parental account. (Although my 30-something editor informs me that he still uses his parents’ account, too.) You can see the issue for Netflix. It doesn’t have the luxury that internet providers have, that as soon as a kid leaves home he has to get his own subscription. So its subscription business doesn’t 2017 Harvard Business School Publishing Corp. Distributed by The New York Times Syndicate grow with the population. That is perhaps why it raised the price of its top plan by $2, which allows more simultaneous streams — but that increase hardly offsets the loss of a new paying customer. Without new customers being born that Netflix has to compete for, there may come a time when the company runs out of subscriber growth. Then the circle will come back around for Netflix and, like today’s TV incumbents, it won’t be able to take advantage of new channels without cannibalizing its hard-won legacy customers. (Joshua Gans is a professor of strategic management at the University of Toronto’s Rotman School of Management and the co-author of “Prediction Machines: The Simple Economics of Artificial Intelligence.”)
Kia offers yearend 10% sales discount ‘Micking lubricants offers quality at low price’ ‘NRC contracts process followed 2004 procurement Act’ BUSINESS DAY Page 30 Page 31 Page 30 C002D5556 Wednesday 25 October 2017 ExecutiveMotoring 29 Audi’s new A7 flaunts new style ...Featuring all-digital command centre MIKE OCHONMA Audi’s new and more expressive design language that kicked off with latest A8 saloon has taken the next evolutionary step with the second-generation A7 Sportback, which was revealed recently. The A7 retains its characteristic sloping fastback tail, just with more prominent creases and larger wheel arches, while the front adopts Audi’s latest wide-grin hexagonal grille upfront and joined taillights at the back. Either way, any curious observer can never mistake it for anything other than an A7 and what is called evolution, Audi style. Technologically the new model has taken a proper stride forward and although it doesn’t inherit the new A8’s ‘Audi AI’ autonomous driving capabilities, it does get its fair share of ‘artificial intelligence’ features, along with a new alldigital command centre. The new car almost completely does away with traditional buttons and rotary dials, with the central dashboard occupied by two large verticallystacked touch-screens, which seamlessly blend into the surrounding facia. Up to seven drivers can create user profiles for the vehicle’s features and up to 400 parameters can be personalised. In terms of gadgets, the highlight here is the self explanatory Audi AI remote parking pilot and remote garage pilot, which allow the car to manoeuvre autonomously, even with the driver outside of the vehicle. These will only become available next year, however. Depending on what gadgets are selected, the A7 can come loaded with as many as Merc recalls over a million cars for airbag fix ponents. An electrostatic discharge, coupled with a broken clock-spring and insufficient earthling of steering components, could lead to inadvertent deployment of the driver’s side front airbag. Apparently, a warning light will appear on the dashboard if the clock-spring breaks and if Mercedes-Benz is recalling more than a million cars and SUVs worldwide to deal with potential unintended airbag deployments. Company officials said the safety recall covered 495,000 vehicles in the United States, 400,000 in Britain, 76,000 in Canada and a few hundred thousand in Germany. They didn’t immediately have a worldwide total. Models involved are some A, B and C-Class models from 2012 to 2018, as well as some CLA, GLA and GLC sports utility vehicles. The E-Class is also among the models affected by the airbag recall. As part of the fix, the company said dealers would add new earthling to the steering comfive radar sensors, five cameras, a laser scanner and 12 ultrasonic sensors, while up to 39 different driver assistance gadgets are offered in total. As with the new A8, the A7 will sport a 48-volt electrical system, with a lithium ion battery that can store recuperated energy, thus allowing ‘mild’ hybrid capability. Only one engine will be available initially, this being Audi’s 3.0 V6 TFSI turbopetrol, rated at 250kW and 600Nm, and sending power to all four wheels via a sevenspeed S Tronic dual-clutch gearbox and quattro all-wheel drive. Audi claims a 5.3 second 0-100km/h sprint and 250km/h electronically limited top speed. Audi assures that the engine range will be expanded shortly after the start of production, with additional four and six-cylinder petrol and that happens, customers should immediately contact their dealer for the repair because, if the wiring is not correctly earthed, the airbag in the steering-wheel diesel engines joining the line-up. The new model rides on an updated chassis, and while standard models still feature steel suspension, buyers will be able to opt for a revised adaptive air suspension system, along with a rear axle sport differential and allwheel steering. According to Audi SA, the new A7 is expected to go on sale locally during the second quarter of 2018. boss can go off by itself. The dealer will replace to clock-spring module in the steering wheel, a job which should take an hour at most, at no cost to the customer and the automaker said it would be contacting affected customers and asking them to bring their cars in. A Mercedes-Benz spokeswoman in the United States said there had been “a handful of instances where drivers suffered minor abrasions or bruises” due to the airbag problem. No deaths have been reported and the issue is not related to the huge recall of Takata airbag inflators worldwide. Mercedes- Benz South Africa said it was aware of the recall and if any local models are affected, owners will be contacted. Massilia Motors offers 25% discount on full body paint Massilia Motors, owners of the Mitsubishi brand in Nigeria is currently offering a 25% discount for full body paint of all brands and models in their ultra-modern workshops’ in Lagos and Abuja. The new promotion, tagged ‘New Look Promo’ with started on October 9 will end October 31, 2017. The Mitsubishi representative in Nigeria is extending the promo to other auto brands in the country as a way of supporting Nigerians to keep their cherished vehicles in good shape despite the tough times being experienced. Known for its reputation in not just sales of automobiles, but after-sales services, the company which prides itself as a top notch auto services provider in the country assures customers and prospects that it will “give your car the fresh look it deserves”. “With the high cost of automobiles in the country, it is wise for vehicle owners to keep the ones they have in good shape, hence, we are offering our professional support to car owners in our state of the arts workshop”, says General Manager, After Sales, of Massilia Motors, Dominique Beguin. Company sources say that Massilia added that the company’s personnel are well trained to render quality services to its customers, as according to the company, technical advances now incorporated in vehicles require highly trained technicians to ensure good aftersales service. Quality auto body paint is beneficial to the car in many ways. Aside improving and prolonging the value of the vehicle, it also helps repel environmental damage and enhance the aesthetics of the car.
Page 1 and 2: NSE 36,650 36,600 36,550 36,500 36,
Page 3 and 4: Wednesday 25 October 2017 BUSINESS
Page 5 and 6: Wednesday 25 October 2017 BUSINESS
Page 7 and 8: Wednesday 25 October 2017 8 BUSINES
Page 9 and 10: Wednesday 25 October 2017 10 BUSINE
Page 13 and 14: 14 BUSINESS DAY COMPANIES & MARKETS
Page 15 and 16: 16 BUSINESS DAY Wednesday 25 Octobe
Page 17 and 18: Wednesday 23 October 2017 maritime
Page 28 and 29: 30 BUSINESS DAY C002D5556 Wednesday
Page 36 and 37: 38 BUSINESS DAY C002D5556 Wednesday
Page 38 and 39: Wednesday 25 October 2017 NEWS Hous
Page 40 and 41: Wednesday 25 October 2017 FT FINANC
Page 42 and 43: Wednesday 25 October 2017 COMPANIES
Page 44 and 45: Wednesday 25 October 2017 C002D5556
Page 49 and 50: Wednesday 25 October 2017 gas ‘CN
Page 53 and 54: Wednesday 25 October 2017 marketins
Page 55: BUSINESS DAY Why it Matters NEWS YO

BusinessDay 25 Oct 2017

Create successful ePaper yourself

Delete template?

Save as template?