Fathoming Porter's five forces model in the internet era

Abstract

Purpose-To investigate the impact of the internet in ''traditional'' market rules. Design/methodology/approach-An opinion piece based on Michael Porter's arguments for the new economy. Finding-Michael Porter's arguments for the new economy provide a useful starting point in the analysis of the environment. His arguments are based on exaggerated phenomena. Factors that determine a sector's profitability could be enriched with the innovation that prevails in the particular sector. Originality/value-An attempt to criticize Porter's thoughts regarding internet and industry structure and to enrich the Porter's five forces model with the ''power of innovation''.

Past, present and future of mobile payments research: A literature review

“…According to Pearce and Robinson [65] and Johnson [29], the strengths of Porter's model are that it provides one simple approach to analyze industry structure, identify and determine the attractiveness of an industry, reveal insights on profitability, inform important decisions about whether to leave or enter industries or sectors, and develop strategic options to improve relative performance in the industry or influence relative position in the industry. As one of the most influential management tools for strategic industry analysis [3], the model has been applied by numerous practitioners and academics [30]. The above arguments suggest that the model is well suited to guide the classification of literature on the mobile payments services markets.…”

“…The model applies insights from industrial organization theory to analyze the competitive environment on the level of business units [3], and relates the average profitability of the participants in an industry to competitive forces [30]. The basic proposition is that organizational performance mainly depends on the industry structure.…”

The socio-economic potential of under-utilized species to small holder farmers: The case of Khat (Catha edulis) in Ethiopia

“…There also are some entry barriers whenever it is difficult or not economically feasible for an outsider to replicate the existing firms" position. Apart from some intrinsic physical or legal obstacles, the common forms of entry barriers are the scale and the investment required to enter an industry as an efficient competitor (Karagiannopoulos et al, 2005).…”

“…Buyers with bargaining power can extract excess profit from an industry by putting downward pressure on prices, demanding better quality products or services, and play industry participants off against one another (Porter, 2008). According to Karagiannopoulos et al (2005), the determinants of buyer power are the size and the concentration of customers, the extent to which the buyers are informed and the concentration or differentiation of the competitors.…”

Business Analysis on Sweet Condensed Tempeh as a Functional Food

“…They argue that before the advent of the internet, every industry consisted of a physical part and an informational set and the informational set was difficult to handle and access. This makes them to further point that Porter's argument that in as much as the five underlying forces of competition determine the industry attractiveness, it has also been challenged by its failure to explain the expansion of the distance learning industry [7] On this research, we are still using model porter in this research with the consideration, that the object of this research still relevant if it is analyzed using the model. Developed Product is a product with quite innovation levels, but the impact on the model of free market competition ~where the limits of the market are not visible due to the development of information technology~ does not give significant effects against products since the product recognize as traditional products based, although quite different form with the original product Porter's five competitive forces are depicted in Figure 1.…”