The mobile telecommunications industry in Ireland has always been a competitive and rapidly changing industry. It has changed considerably from it’s initial birth with only one competitor, to it’s liberalisation in 1998, all the way through to the introduction of MVNO’s in the 2000’s. Mobile penetration has increased from 42 % in 2000 (Telecommunications and Internet Federation, 2005) to almost 97% of Irish adults owning a mobile phone now in 2013. (Irishexaminer.com, 2013) In order to fully understand the rapid development of this industry and the future of it, we must first look at its history in 1998. The Telecommunications Industry in Ireland in 1998 was a duopoly, meaning that there were only two service providers in the market. These were Eircell, which is better known today as Vodafone, and Esat Digifone, known today as O2. The industry therefore was small and had very limited competition. The industry was only in it’s initial early stages. Michael Porter created the five Forces Framework in order to analyse industry competitiveness and attractiveness.(Porter,1997, pp.137-145) The varying degrees of strength or weakness of these five forces determine whether an industry can make high returns, thus determining whether it is an attractive industry or not. The more powerful each of these five forces is, the less profitable an industry will be. These five forces, the threat of new entry, power of buyers, power of suppliers, the threat of substitution and the intensity of rivalry should be examined in relation to the telecommunications industry in 1998 in order to assess its attractiveness. The first force is the threat of new entry. In the telecommunications industry before December 1998, the threat of new entry was very lo... ... middle of paper ... .... 2006. Meteor-ic Rise: How a Carefully Executed Advertising Strategy can Grow a Brand’s Market Share in Under a Year. [online] Available at: http://www.adfx.ie/cases/cases06/meteor.pdf [Accessed: 29th Nov 2013]. Ibec.ie. 2011. Telecoms industry discuss future mobile trends | Ibec - Newsroom. [online] Available at: http://www.ibec.ie/ibec/press/presspublicationsdoclib3.nsf/wvSectorNews/63D99994F6B244E9802578B90053DDA5 [Accessed: 31st Nov 2013]. heanet.ie. 2013. The next decade in Mobile Communications – An Irish Operators perspective. [online] Available at: http://www.heanet.ie/conferences/2011/files/46/Pat%20Moynihan%20-%20O2.pdf [Accessed: 29th Nov 2013] Irish Times. 2013. Three Ireland suffers outage as O2 sale agreed. [online] Available at: http://www.irishtimes.com/business/three-ireland-suffers-outage-as-o2-sale-agreed-1.1440839 [Accessed: 31st Nov 2013].
Porter’s Five Forces Forces Grade Note Segment Rivalry Strong The current market is divided between a few powerful competitors that can relatively easily attract customers from one another as the switching costs are low and practical absence of product differentiation contributes to the easy loss of market share. Threat of Mobility Weak While the new entrants only need a relatively simple GUI and a supplier in order to enter the market, the federal and local regulations will require significant investments prior to any positive cash flow. Again, the differentiation is practically non-existent and the new entrants will have to compete with financially established enterprises capitalizing on competitive advantage. Supplier power Strong
Of particular importance is the deregulation of the telecommunications industry as mentioned in the act (“Implementation of the Telecommunications Act,” NTLA). This reflects a new thinking that service providers should not be limited by artificial and now antique regulatory categories but should be permitted to compete with each other in a robust marketplace that contains many diverse participants. Moreover the Act is evidence of governmental commitment to make sure that all citizens have access to advanced communication services at affordable prices through its “universal service” provisions even as competitive markets for the telecommunications industry expand. Prior to passage of this new Act, U.S. federal and state laws and a judicially established consent decree allowed some competition for certain services, most notably among long distance carriers. Universal service for basic telephony was a national objective, but one developed and shaped through federal and state regulations and case law (“Telecommunications Act of 1996,” Technology Law). The goal of universal service was referred to only in general terms in the Communications Act of 1934, the nation's basic telecommunications statute. The Telecommunications Act of 1996 among other things: (i) opens up competition by local telephone companies, long distance providers, and cable companies ...
Years later, the Telecommunication Act of 1996 triggered dramatic changes in the competitive landscape. SBC Communications Inc. established itself as a global communications provider by acquiring Pacific Telesis Group and becoming the new AT&T. The merger of AT& T and BellSouth, along with the ownership consolidation of Cingular Wireless and YELLOWPAGES.COM, will speed convergence, competition and continued innovation in the communications and entertainment industry, creating new solutions for consumers and businesses and positioned to lead the industry in one of its most signifi...
In the 1990s, the telecommunications market was rapidly changing with the addition of new entrants from a competition standpoint that were forcing WorldCom to decrease prices. Long term leases for
Porter expresses how bargaining power of buyers in the five forces of competitive forces and explain that “the buyers compete with an industry by exerting a downward pressure on its prices, negotiating for higher and better quality service.” The company or organization plays off the competitor at the expense of an industry profitability. “Everything is based upon the market size situation according to Porter (P. 271).”
In a competitive environment where market is changing instantly, organizations are in a fix to design a strategy that could market their products enticing the consumers to buy their products and services. Market is the arena for business gladiators who fight out for maximum share and profitability and this is possible only through effective marketing strategy. Competing in present economy means finding ways to break out of commodity status to meet customers’ needs better than competing firms (Ferrell and Hartline, 2010). The intensity of competition has increased after the introduction of media and internet where the companies present their product in the best way through advertisements, product reviews, blog entries, etc. With the advancement in technological innovations, companies have found various ways of providing services to the consumers in a cheaper and effective way and this has resulted in communication revolution in late 1990’s as the cellular technology was unfold in most of the regions. Singtel Optus Pty Limited (Optus) is one such company that has evolved during this period as a leader in integrated communications and this paper is assumed to make an analysis of the company’s marketing strategy and its financial position in the market industry.
Cellular phones carry a diverse group of users. In June 1985, there were about 203,000 cellular phone service subscribers. By June 1989, the number had exploded to 2.7 million subscribers, and by June 1995 there were mire than 26 million subscribers. When cell phones were first introduce, only people with a lot of money had them and the service was very expensive. It was a lot cheaper to stop and use the pay phone than it was to use a cell phone. Now, it is almost as cheap to use a cell phone to make a long distance call as it is to make a long distance call using AT&T.
Analysis of the Environment of the Mobile Network System Executive Summary 3 Glossary of Abbreviations 4 Introduction 5 Recent History
The following report will analyse Vodafone and their current position in the international market. This report will cover the competitive strategy of Vodafone and their influence of products and services in relation to the demand of the market.
Mobile is the first order priority device for access because people are connecting with others, finding entertainment, and doing business—all with smart phones. The prices of mobile phones are never over $1,000 in today’s world. They are affordable and accessible. As the result of the changes the worldwide and national business environment has undergone, people own 1-2 cell phones on average. However, the mobile markets in US seems to have been saturated.
There is a slowdown in sales of mobile handsets, in some markets like the UK, as the mature part of the product lifecycle is reached. Customers are exposed to a barrage of different images and messages by mobile phone companies, as the competition gets tougher. Vodafone appeals to new customers and aims to keep its existing ones by emphasising the uniqueness of the brand.
Print. The. Gordon A. Gow, and Richard K. Smith. Mobile and wireless communications: an introduction, McGraw-Hill International, 2006. Print.
The economic problem was that WorldCom had a vast supply in telecommunications capacity that emerged in the 1990s, as the industry rushed to build fibre optic networks and other infrastructure based on overly optimistic projections of Internet growth (Lyke and Jickling, 2002)
Porter’s five forces is a framework for analyzing an industry and business strategy development. It looks at forces that determine the competitive intensity of an industry and hence the overall attractiveness of that industry. The configuration of the five forces differs by industry. Understanding the competitive forces and their underlying causes reveals the roots of an industry’s current profitability while providing a framework for anticipating and influencing competition over time.
We should know how everyday life is changing and how this relates to mobile telephony. Work Cited = == ==