FRASIER CASE ANALYSIS Harvard Case Solution & Analysis

Question # 1:

Integrative bargaining mainly focuses on integrating the interests of both the parties in the final agreement with an aim to create value for personal interest along with the interest of the other party (Rosenthal, 1999). While the distributive bargaining focus on dividing the resources and the interest of one party depends on the loss of another party (Thompson, Peterson, & Brodt, 1996).

The situation indicates that the style of negotiation was integrative as both the companies had competing interests. Paramount as the owner of the show were demanding a license fee of approximately $6 million, which was not an attractive fee for NBC. NBC was willing to pay $5 million for the next three seasons and was still not reaching the breakeven. The final agreement suggested that both the parties have the shared value of interests and allowed both the parties to agree on a deal in the favor both the parties.

Question # 2:

The sources of power for NBC was that they had an audience for the Fraiser show since the channel has aired the last eight seasons of the show. The channel was at strength because the channel helped a lot in gaining the target audience for the show and switching the channel will result in a decrease in ratings of the show. One other factor giving power to NBC was the license fee it has offered. The license fee was the best proposed and nearest of the demand of the paramount and the highest in the industry as well. Graboff the former employee of CBS was also a source of strength for NBC as he has the complete knowledge of the strengths of CBS and was clear that the resources of CBS don’t allow CBS to be a possible contender for taking Fraiser.

 

Paramount on the other had very minimal strengths as compared to NBC in the negotiation. The only prominent powers that they have been the holding rights of the show and claimed to give the rights to any other channel, including CBS, which was also the sister company of CBS. After analyzing this situation, it can be stated that NBC was on the strength in terms of power in the negotiation.

Question # 3:

Garboff was of the view that keeping the show at the price of $5 million is not a good idea as it is not even reaching the break-even point, but keeping the show was important for NBC as they didn’t have the appropriate show as a replacement and they had the audience. Garboff in his preparation formulated a team to analyze the current and projected sales and ratings of the show. The strategies applied by Garboff were mainly focusing on compromising, as the company was willing to pay a bit high license fee to keep the show and was ready to afford some loss. Garboff had the view that since NBC has broadcasted the last eight seasons of the show so it should be given the charge of the last 3 seasons as well as it has a target audience as well.

In his preparation he also analyzed the chances of the show to be given to some other channel and closely analyzed the position of the competing channels. Garboff was confident that no other channel has the target audience for the show and the resources to pay the license fee for the show. Garboff also considered the fact that in the past negotiations paramount did not have the option of switching channels and the agreement does not have any clause that can prevent paramount from doing so. The analysis that Garboff conducted, also focuses on the loss that the company will have to face in order to keep the show.

 

BATNA or the best alternative to a negotiated agreement is defined as a solution or present an alternative to the parties in the case of not reaching any final agreement. NBC’s BATNA was to buy another show from another channel in order to replace Fraiser. The options NBC was considering was the hit show Dharma & Greg from ABC network. This option had a drawback as well, which will involve channels in entering into a bidding war for different TV shows giving power to the holders of the show and giving rise to the programming cost. On the other hand, Garboff was also aware of the fact that switching channel will result in loss of ratings for Fraiser; and no other channel can compete with the bid price offered by NBC. In such a case NBC was the best option for paramount and taking Fraiser away from NBC will also result in the loss of viewership of the show and paramount will suffer in the industry because of the failure of................

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