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...
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