QUESTION
This Report should identify the most important current trends in the industry in your allocated country, including:
- What have been and what will be the consequences of continuing globalization on the industry in the particular country?
- What are the major economic trends and forecasts and what impact are they having now on the industry in the country and how will that change in the future?
- What are the major ecological and environmental challenges the industry faces in this country and how will these evolve and change in the future?
- What political, government and legal factors are important to this industry in this country and are these likely to change or evolve in the foreseeable future?
- How are technological advances influencing the development of this industry in this country and how do you expect this to change in the future?
- Do the key elements of the culture and society in the country have a significant impact or influence on the industry currently and is this changing?
SOLUTION
Executive Summary:
Flat TV in India is really a new concept for the Indian television industry and the market. Earlier we used to have a traditional kind of television with cervical screen structure. But after the globalization, MNCs came up with this new kind of innovative feature in the traditional TV i.e. flat TV screen. They just changed the scenario in India. As we know TV is one of the most important parts of our life, in each and every house we have at-least 1 or 2 TV set. It is one of the most important parts of entertainment in our life. Globalization changed the scenario and made a new kind of scenario in the TV industry with the Flat TV innovation. Indian customer adopted this new kind of Flat screen TV. So it was a kind of booming market for the MNCs such as LG, SONY, Videocon and other.
After sometimes they came up with new add on features like golden eye, auto colour adjustment and various other features to attract the customers. The report includes all the aspects of the economics, ecological, social, demographic, cultural aspects and the considerations which is being taken care by the market players to make an effective and integrated step in the evolution of Flat Screen TV industry in India.
What have been and what will be the consequences of continuing globalization on the industry in the particular country?
As we know the cost which is incurred to establish the TV industry is not very much high. So it is easy for the players to come up in the market. This concept is increasing the competition in the Flat Screen TV market in India.
MNCs are coming with new kind of innovation and advantages in their television and attracting the customers and grabbing the market share of the existing players. Indian players are now no more able to compete with these global players due to their non innovative and ineffective R&D considerations and this is a greatest strength for the MNCs to grab the market share effectively.
If the globalization will be continued in the same manner then there will be a good and even better chances and options for the consumers at a competitive and less price. Earlier we used to pay high for the traditional TVs but now we are paying very much less compared to the earlier days and also getting lot more features at the lowest price. These all drastic changes are only possible due to the globalization in the industry. Due to increase in market players, the existing players were forced to change their strategy and make a flexible kind of strategy including R&D, pricing strategy, innovation in their product, economies of scale and other aspects. These are the important aspects to sustain in the market. If the players are lacking in these aspects then there are very less and even no chances to sustain in the market. And it is obvious that the strong player will gain advantage of your weakness.
Globalization is also working on the same concept and it is very much effective and required for the economy to make it more flexible and effective rather than continuing with the same kind of traditional concept and strategy. So it is quite necessary to continue with the globalization to make the whole scenario more consumers friendly.
What are the major economic trends and forecasts and what impact are they having now on the industry in the country and how will that change in the future?
In India there is a 100 percent FDI allowed in the electronics goods sector. So it is again a kind of effective and integrated sources of strategy and considerations for the TVs manufacturers to come up with new and innovative kind of features to make an effective use of the economic considerations and the same has happened with the Flat Screen TV sector in India. The MNCs came up with this new kind of feature that was really a new feature for the Indian customers due to the inefficiency and non innovativeness in the Indian players. And MNCs used that weakness as their greatest strength and they trapped the whole market very easily.
Setting up the manufacturing plant: MNCs started setting up their manufacturing plant in India itself due to various advantages such as,
Low cost labour presence: Due to high population there is a good chunk of low cost labour force. MNCs utilized this aspect for setting up their manufacturing plant in India itself to save the cost and economics of scale production.
Suppliers: Availability of suppliers for the ease of production at competitive prices. This is again a good advantage for the manufacturer to establish their manufacturing unit in India.
Transportation: Mode of transportation is also available in India. Roadways, trains, shipping, and other sources of transportation have made it more effective and efficient.
Easy availability of raw material: Raw material availability is again easy in India. There are umpteen sources of raw material at a cheap price. That is a good sign for the manufacturer to establish their own manufacturing unit in India.
Land availability: Land availability is also easy and competitive in India. Most of the land is being used by the farmers for the farming purposes. Industrialists are making use of these lands at a competitive and cheap prices compared to the other places.
These aspects are really good sources of encouragement of the new players and keeping a kind of flexibility in the Flat Screen TV industry and its advancement in India. These aspects will surely increase the existence of the new entrants in the market. That will again help the economy to increase the economic aspects and make it more flexible and consumer friendly.
What are the major ecological and environmental challenges the industry faces in this country and how will these evolve and change in the future?
There are still lots of challenge in this sector, and the market players need to make them more effective to reduce these kind of challenges to open the more place for their market.
Taxation: Taxation is one of the biggest challenges for the market players in India. At present it is around 25-30 percent and in other Asia countries, it is between 8-17 percent. So we can understand the scenario. It should be made more industry friendly and that will surely be an advantage for the economy and the consumers as well.
Power supply: India is a country of villages, and most of the villagers are still not having the power supply. So it is again a challenge for the TV sector in India to catch the most of the untapped market in India.
Brand and product promotion: People who live in villages are still very much unknown about the Flat Screen TV in India. They are still not very much known about this kind of innovation in the TV. So there is a need to effective brand and product promotion to make an effective and strong brand building.
If these challenges are being reduced and uprooted then it will be a great source of income for the economy and the whole economy will boom collectively. So we need to take some effective steps in this regards.
What political, government and legal factors are important to this industry in this country and are these likely to change or evolve in the foreseeable future?
There are various political, government and legal factors that are required to be fulfilled and addressed while working in this industry in India. The taxation considerations, various certifications, financing considerations, budgetary considerations and other aspects are also there which is required to be fulfilled and followed by the market players strictly, without any failure. These aspects should be made more market friendly and flexible for the better implications of these rules and regulations. For a better and long-lasting future perspective, these challenges and issues should be make more flexible and market friendly to get the maximum benefit out of that.
The Competition Act, 2002 provided for the establishment of a Competition Commission, to prevent practices that have adverse effect on market competition, to promote the competition in markets, to protect the consumer’s interest and to ensure freedom of trade in India.
How are technological advances influencing the development of this industry in this country and how do you expect this to change in the future?
These changes in the product from traditional to the Flat screen and other innovative aspects are all due to the change in technological aspects and their effective implications by the manufacturers and the companies. The adaptation of new technologies and their advancement is being encouraged by these devices and the Indian consumers are very much attracted towards these kinds of implications of the technologies in the products and they are utilizing these advantages effectively.
One by one the manufacturers are coming up with new and advance technological implications in their products and the customers are utilizing these new innovations in the product like the flat screen TV, LCDs and other new upcoming products in this concept. So we can easily see the market share and growth rate of the MNCs which are coming up with these new and innovative kinds of add on features in their product such as Samsung, LG, Sony and others. They are most of the booming and highest growing companies in this sector. So we can foresee the kind of future for the Indian television industry with this kind of innovation and technological advancement.
Do the key elements of the culture and society in the country have a significant impact or influence on the industry currently and is this changing?
There is always an influence of cultural and social aspects of the particular country to the product or the services which is being provided in that particular country. No in a broader aspect but there are some cultural and social significance of the country works in the Flat Screen TV industry in India.
According to Seshaiah and Krishna (2003), branding of Flat Screen TV is an important factor in determining the choice of Flat Screen TV by buyers and mostly in villages, which not only depends on education, age and income, but also on psychological and personality traits and dimensions.
The Indian people are very much encouraged and influenced by the new kind of innovative aspect of the Flat Screen TV and their colour consideration and other add on features like the golden eye, woofer additions and other features. These aspects have made a different kind of concept in Indian television industry. Now we can get an add on and fully loaded television and no need of buying the external music systems.
So these are the upcoming features which have changes the whole scenario which we were having earlier. And in the coming future these aspects will surely change the current trend of Flat Screen TV by some other substitute like 3 D or 4 D TVs.
Reference
Porter, M.E. (1980), Competitive Strategy: Techniques for Analyzing Industries and Competitors, The free Press: NY, pp 129-130
Seshaiah, Venkata and Radah, Krishna. Liberalization and Color Flat Screen Television Industry in India. JEL Classifications: L96, 03, 053. Estudios Económicos Regional Sectoriales. AEEADE. Vol. 3- 2 (2003).
Parikh A. Mihir. Globalizing the Indian Television Industry: Implications and Opportunities. Nishith Desai Associates, Legal and Tax Counselling Worldwide.
Gupta Seema. Indian Television Industry: A Strategic Analysis; IIM, Bangalore. 2006.
Bhattacharjea Aditya & Nanda Nitya. Cr0ss-Border Competition Issues. Towards a
Functional Competition Policy for India. An Overview. Edited by Pradeep S Mehta.
CUTS International. 2005. Academic Foundations.
Chakrabotry Adrija, Gupta Aman, Gupta Pritha and Saxena Sofia, Demand Forecasting:
The Color Television Market. Managerial Economics.
Electronic and Appliances Manufacturing- The India Opportunity. ASSOCHAM. E&Y
Report. August 2009.
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