Transnational Business Operation Strategy Suggestion of CNC

Transnational Business Operation Strategy Suggestion of CNC

From the above competitive environment analysis and competitiveness evaluation of CNC, the SWOT analysis can be arranged in Table 2. Based on the strategic management framework of SWOT, the transnational business development strategy is proposed as follows:

STUDY ON TRANSNATIONAL BUSINESS OPERATION STRATEGY 699

Table 2 SWOT Analysis of CNC

(1) Use of internationally accepted language; Strength (S)

(2) Ratio of news programs accounted for in to the all programs of the channel; (3) The ability to broadcast news firstly. (1) Narrow coverage area of population and limited number of countries entered into; (2) Short of brand program;

Weakness (W) (3) Short of famous presenters; (4) Lack of profitability. (1) Development of new media; (2) Global financial crisis change the strength contrast of the Chinese and the foreign media;

Opportunity (O) (3) Fallen cost of international communication operation will strengthen the construction of overseas positions.

Threats (T) (1) Saturated development space; (2) Strict market entry regulation.

Use Various Foreign Channel Landing Modes to Expand the Coverage Area of CNC

In short term, in order to strengthen its advantage in news production, considering the saturated market with strict industrial regulation, it is necessary for CNC to modify its weakness of narrow coverage area of population and limited number of countries entered into. This requires CNC flexibly using various kinds of channels landing modes to enter the foreign market.

Channel lease. In this mode, CNC makes channel lease agreements with foreign channel owner. Under the agreement, CNC pays rent to foreign channel lesser; in return, all CNC programs are permitted to play on this foreign channel, and the foreign channel ownership shall not spot any content except “disaster emergency radio” and “propaganda on their own platform”. Such landing mode requires low cost and ensures the quick entry into these foreign markets.

Copyright sell or subscription-sharing. In this mode, CNC provides programs to foreign operators. Foreign operators can place commercial advertisement at interval in CNC channel in the constraints of contract, and in return, the foreign operators are required to pay royalties or subscriptions fees to CNC party.

The benefit of this model is that foreign operators must increase efforts to promote the CNC in order to make money; the difficulty of this model lies in the operation process. CNC should make suitable contract to restrain the foreign operator’s spot content. Not only must the advertisement inserted by foreign operators be in comply with local laws, but also do not harm the interests of the People’s Republic of China. At the same time, the duration of advertisement inserted need be fixed, generally no more than 12 seconds every hour. In addition, this mode requires little sunk cost and the exposure of risk is low, but it is feasible on the condition that the CNC’s programs seem to attract the audience in foreign target market.

Resource exchange. In this operating mode, the two parties, CNC and foreign channel operators, swap and use resource between each other freely, CNC provides programs without accepting a royalty fee, and foreign channel owners provide broadcasting channel without demanding channel fee; the CNC program is broadcast on the channel throughout the day, but only provide the equipment to the foreign operators which are used to receive satellite signals, and equipment property is owned by CNC. While CNC must make commitment that it not interfere the foreign party’s way to promote CNC, it is necessary to ask the foreign side to put CNC into basic package rather than into charge bags.

700 STUDY ON TRANSNATIONAL BUSINESS OPERATION STRATEGY Establishment of cooperative set. This mode means that CNC has entered local transmission platform by

setting cooperation set with local partner. Under this mode, CNC require its partner to play CNC programs in their channel, should fix the duration of program, and should not interfere with the integrity of CNC program. Cooperate partner can replace CNC’s add-in advertisements, but no more than 12s/hr. Also, CNC has the final adjudication about the content of advertisements. The profit sharing is limited to CNC local profits.

Direct purchase channel. With the suitable conditions, CNC can purchase directly the foreign channel. The advantage of this model is obvious: such ownership of foreign channel can definitely form valuable assets in the long-run. CNC has larger decision power in the operation of their programs in foreign target markets. When CNC changes another broadcasting platform in the future, it can resale this channel signal or rent to the third party, so this mode has some flexibility. The difficulties of this model are the high threshold for market access and high operating costs. It applies only to countries with higher market value for development, as well as the important target country.

Build Its Brand Effects Across the World

In long term, in order to achieve core sustainable competitiveness, CNC must cultivate and strength its brand effects across the world in terms of production of brand programs and fostering the famous presenters. Both the cultivation of brand programs and fostering presenters require the large investment of money and the high technology resources. As a result, the CNC should accelerate its restructuring pace into corporation and operate on the rule of market system with the aim of profit maximization. Only with quality of legalized corporation and strong profitability, can CNC have financial resources available for enhancing brand effects.

Build New Technology Experience Across the World

In order to seize the opportunity of the development of new media, it is also urgent for CNC to accumulate the new media experience. CNC can make more breakthrough in the use of new media channels to expand the global spread, for example, adding interactive functionalities of blog or micro blog in the internet news channel or mobile phone news channel, making jointly product research and launch on innovative product terminals like Apple with world terminal producers, etc.