Company A is considering launching a mobile streaming service for episodic television content. We would license the content for this streaming service on a quarterly basis for a flat fee per TV series. The service is free to customers, i.e. no subscription fee to access the content, and it generates revenue by displaying advertisements between episodes of each show. Advertisements are typically shown at the start of each episode, except for the first episode in each TV series.
There are three types of TV content to consider: A, B, and C. We have included Q3 2017 data for each of the three types of content by TV episode, licensing fees by type of content, and average eCPMs received from our advertising partners. Key assumptions to augment your analysis can and should be sourced from any public resource available.
You are the strategic finance analyst assigned to this initiative. Your responsibility is to provide a recommendation for how much to invest in new content and the allocation of your investment to each type of content over the next year. Please consider both quantitative and qualitative factors in your recommendation. You are expected to include KPIs and metrics in your analysis. Please perform your data analysis in Excel and include your scratch work. We will be evaluating the basis of your analysis as well as your final recommendation.
Solved by C. L. in 15 mins