Warner Bros. has a solid financial position with USD 12 billion revenues generated during the year of 2012 alone with more than USD 1.2 billion operating income (Annual Report, 2012). Moreover, Warner Bros. has produced a series of successful franchises such as The Lord of the Rings, Batman, Harry Potter and Hangover that have immense contributions to the level of profitability of the company. Knowledge and experiences associated with the production of these successful franchises can be specified as strengths of Warner Bros.
The agreement of Warner Bros. with Netflix Inc. that allows the company to stream previous sessions of shows’ series shown on CW network can be added to the list of its strengths due to the associated potentials for profit maximisation.
Overdependence of Warner Bros. on the home market in the US is its major weakness in global competition. US government debt issues and implications of this issue on consumer spending patterns in the future increases the level of urgency of this weakness on long-term perspectives.
Moreover, recent damage to Warner Bros. brand image for being used for infringing Cat Meme Copyright can be listed as weakness for the company that has to be addressed by senior level management.
There is an attractive profit maximisation opportunity for Warner Bros. through introducing new instalments to its successful franchises such as The Lord of the Rings, Batman, Harry Potter and Hangover.
Expansion of digital distribution capabilities represents opportunity for Warner Bros. to strengthen its role as a leader of technological changes in the industry. Moreover, the levels of Warner Bros. revenues can be further increased through higher integration of product placement marketing strategy.
Business threats faced by Warner Bros. are diverse and they primarily include further decline of the sales of DVDs due to the maturation of DVD format of entertainment, challenging economic conditions, and piracy.
Furthermore, the threat of loosing more revenues because of piracy should not be underestimated, because despite attempts for a numbers of years effective solutions have not been found yet for this problem.
Declining popularity of US television programs represent considerable threat to Warner Bros. revenues for long-term perspective and increasing levels of operational costs are additional challenges to be addressed by the company.