What is your BATNA? Reservation Price? Target? Please provide some explanation/justification for your answers.
BATNA: Go for the alternate deal currently valued at $3,000,000 (as the network is in need for new programs)
Reservation Price: Cover the cost of the licensing fee for the show ($60,000 per episode), 8 airings of an episode
Target: Have licensing fee less than $60,000 per episode (A fee larger than 60,000 will lead to losses), Have more than 6 runs a day to increase ad revenue, less than 8 runs a day, licensing fee for juniors should be less than $20,000 per episode to avoid losses
What do you think are your opponent’s interests in the negotiation? What issues do you think are most important to your opponent? (list in order of importance). This is obviously somewhat speculative but try your best to get into the mind of your opponent. If there are multiple other parties in the negotiation, please briefly answer this for each of the other parties.
Opponent Interests:
Release moms.com for syndication (at a low runs of each episode)
Sell Juniors in the later year (Due to low demographic interest for the show)
What do you think might be your opponent’s BATNA? Reservation Price? Goal-Target? Please provide some explanation/justification for your answers. Again, if there are multiple other parties, do this briefly for each.
BATNA: Sell moms.com to another competitor
Reservation Point: ~$60,000 per episode, ~6 airings of an episode
Target: Maximize licensing fee for both moms.com and Juniors, minimize runs per day to avoid dilution
What are your sources of power in the negotiation? What are theirs?
Ours:
HOLLYVILLE has had poor sales in the last season (two shows planned for syndication were not sold)
Financial position has deteriorated over the annual projections
Other network stations are not interested in moms.com
Theirs:
moms.com is highly valued due to demographic ratings and for being advertiser friendly
Recent expansion in the number of network channels
Audience position for WCHI has eroded
WWIN will offer a good price for the program
What will be your opening moves / first strategies? How do you plan to interact with the other party?
Open by anchoring a bid price (lower than sellers reservation price). Try to convince the seller to increase the number of runs per episode. Try to increase it to 8 as neither of us is interested on runs higher than 8. The seller will have to agree to the industry average of 6. Due to the show running for over 5 years, the ratings might drop to the 2-3 range. This is to justify the lower licensing fee for the show.
Please describe any additional notes or thoughts you have about the negotiation and/or your strategies (optional).
(NOTE: THIS CHART IS ONLY FOR YOUR QUICK REFERENCE – YOU DO NOT NEED TO FILL IT OUT FOR CREDIT ON THE ASSIGNMENT)
You
Other party
Interests
BATNA
Reservation Price
Target
Sources of power
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