Analysis of the Macro Environment

Analysis of the macro environment

Using the PESTE analysis tool.

After conducting an extensive PESTE analysis on the macro-environment of influence to the movie industry (See Appendix A - PESTE analysis, page 9) certain aspects came clear as important factors to the future of the movie industry.

Political aspects

The major aspect contributing to the declining success of the movie industry is piracy, Piracy, which means the illegal copying, downloading of movies, prevents the movie industry from generating revenue from all viewers. Even now new legislation is made to battle piracy, the rogue websites are increasing and looking more professional and able to fool even the consumers that wouldn't want to participate in piracy.

Other (smaller) negative political aspects are those of censuring for propaganda purposes and classification, which limit movie creators in what they are allowed to show to audience segments and in the support they can receive making it more expensive to produce a movie.

Positive propaganda also occurs by stimulating the movie industry to show different ethnic groups in positive roles, hoping to engage a bigger audience as now majority of the audience is Caucasian (MPAA, 2011d).

Piracy is however of such a big factor and doesn't appear stoppable by new legislation giving the political aspects a major negative influence to the movie industry.

Economic aspects

The current recession is actually a positive aspect to the movie industry as during periods of recession consumers limit their spendings on leisure activities and the cinema is still one of the cheaper leisure activities, so the recession actually creates an increase in cinema interest.

However, it became clear from consumer response that if