The Challenge of Starting Up A New Internet Venture

Lui and Wong had made a good choice in choosing medicinal drug as there online start up business, beca handling of the nature of music itself is information rich, easygoing to distri stille, consumption experience are in various between digital or physical product, also, without the space limitation of a physical store, MusicJuice. net lavatory provide a large amount of selection for user to choose. In addition, internet landscape em positions the business model of Crowd-Sourcing, where millions of vertical interest base can form their own communities, share and support each other(a) on the internet.And such business model has proven to be rattling flourishing in Europe, theoretically, MusicJuice. net should also be successful in North America where the potential market size was approximately 240,000 musicians. However, the connection has been losing money month after month since launched in April 2008, plainly 70 artistes has signed up in July 2008 and none of them had rea ched the fundraising goal, and of course, no premium members at all. The two co-founders have to decide what could be done to save MusicJuice. et or whether they should close the business for good. Before jumping into conclusion, lets meet the situation with the 5 Forces analysis. First of all, the threats of new entrants are too racy, unless like their competitor Slicethepie. com was launched one month after MusicJuice. net began its development. Forming such music portal requires relatively low capital dedicatement, and there is no customer or brand loyalty at all, because the users will only loyalty to the musicians. The threats of substitute products for MusicJuice. et is also very high, as people will enjoy and obtain the music they like in many different sources, CD Store, radio, youtube, iTunes, sharing between friends, or even download from plagiarism websites Not only facing the threats of new entrants and substitute, what really bothers MusicJuice. net is the high bar gaining power of supplier, i. e. the musicians. The business of MusicJuice. net is bet on the fibre of their signed musicians, but what musicians really cares is to expand their fans network, but not to make up any relationship with a particular platform.Even though the bargaining power of customers is comparatively low when the user addicted into any single musician, but such advantage is not sustainable once the musician replacing to other platform. And the biggest force affecting MusicJuice. net is the high intensity of warlike rivalry, many companies including those major music labels and big IT corporations e. g. Microsoft also attempted to use MySpace to slice the pie of the profitable music industry, not to mention those giants like iTunes and Amazon.Even sight in such unfavorable situation, MusicJuice. net can still do something to rescue their business, not just working on marketing advertize or functional enhancement, but to focus on building the light music communi ty by forming strategic partners with indie band and main(a) music labels, line up with quality musicians to build few showcases of successful stories, aforementioned, their business is bet on the quality of their suppliers, they should provide a resolve for the musicians to sign up on their platform.After all, people are looking for music as an enjoyment, not an investment, MusicJuice. net should provide more interesting exculpate content for the user to enjoy music, but not just invest on music. (end)