Let's say you work really hard to build a line of business into a really successful enterprise. Your customers are satisfied, sales are growing strongly, and profits are nice and fat. What's bound to happen next? The forces of competition will rear their ugly head. Fat profits in a business are like blood in the water to a shiver of sharks (impress your friends with that one: a "shiver" of sharks).
We see this sad tale unfolding once again; this time in the cable business channel market as reported in this story from Business Week. CNBC has built a dominant position, recording an operating margin of 57% and total operating profits of over $300 million according to the article. Who's the shark being drawn by these juicy margins? News Corp. plans to launch the Fox Business Network in the next few weeks.
It's the circle of economic life - I wonder if we could make a movie like the Lion King featuring the death of old companies followed by the rise of new titans (do you think Elton John would write us a theme song?).
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