Questions: The growing popularity of reading news online has significantly reduced the sales of print copies of US newspapers. Which of Porter's five competitive forces does this demonstrate? Threats of new entrants Bargaining power of buyers Bargaining power of suppliers Threats of substitute products or services

The growing popularity of reading news online has significantly reduced the sales of print copies of US newspapers. Which of Porter's five competitive forces does this demonstrate?
Threats of new entrants
Bargaining power of buyers
Bargaining power of suppliers
Threats of substitute products or services
Transcript text: The growing popularity of reading news online has significantly reduced the sales of print copies of US newspapers. Which of Porter's five competitive forces does this demonstrate? Threats of new entrants Bargaining power of buyers Bargaining power of suppliers Threats of substitute products or services
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Solution

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Answer

The answer is Threats of substitute products or services.

Explanation
Option 1: Threats of new entrants

This force refers to the risk that new competitors might enter the market and increase competition. In this case, the issue is not about new companies entering the newspaper industry but rather about existing products being replaced by alternatives.

Option 2: Bargaining power of buyers

This force involves the influence that customers have on a business. While the shift to online news could be seen as buyers exercising their power, the primary issue here is the availability of a substitute product, not the buyers' bargaining power.

Option 3: Bargaining power of suppliers

This force concerns the control that suppliers have over the price and quality of goods and services. The decline in print newspaper sales is not directly related to suppliers' influence.

Option 4: Threats of substitute products or services

This force is about the availability of different products or services that can replace existing ones. The growing popularity of reading news online is a substitute for print newspapers, leading to reduced sales of the latter. This is the most relevant force in this scenario.

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