IT assignment on: Telecommunication industry
INTRODUCTION:
The telecommunication industry or sector has been regarded as one of the sectors which have been growing at a constant pace. Telecommunication is used as a way to transmit the important information through varied distances.
Initially, telecommunication was only confined to the use of visual signs, signal flags, telegraphs, heliographs, beacons, smoke signals, audio messages, etc. But, now the things have changed. People use various mediums of telecommunication which help the users to transmit the information easily & in a struck of a time. Various electrical devices have been used such as telephones, wireless phones, mobile phones, telegraphs, teleprinters, fax machines, fiber optics, etc (Sean, 2011).
In the 21st century, the wireless communication has taken up a roll. With the help of the various means of wireless communication the user is able to be in contact with everyone at any point of time (Sean, 2011). One of the most effective ways through which the two people could share their information would be with the help of two way communication. The two way communication networks has been growing at a fast pace. It grew from 281 peta bytes in the year 1986 to 471 in the year 1993 to 2.2 exa bytes in the year 2000 to 65 exa bytes in 2007. With such a continuous growth in the telecommunication sector, this industry plays a crucial role worldwide. The revenue generated by this sector has been estimated to be approximately $3.85 trillion in the year 2008. Whereas, the service revenue generated by the same has been estimated to be approximately $1.7 trillion in the year 2008 & has also forecasted to touch $2.7 trillion in the year 2013 (Sean, 2011).
It has been seen that, the telecommunication sector has been expanding itself globally. The demand as well as the supply has been increasing for this particular sector. With a constant rise in demand & supply has led to growth in this particular industry. This sector is expected to grow all across the globe at a very high rate. The telecommunication sector has also one of the major components attached to it terms of social, political & cultural aspects (Kotler & Armstrong, 2010).
In order to judge the demand side for this industry, growth has been geared up. Use of the information technology (IT) in normal life has led to a change in the social as well as economic activity of the same. In order to judge the supply of the telecommunication sector, rise in the technology has led to different types of developments of the same. This has also led to change the existing system & enhance the productivity of the same. Convergence of telecommunication industry has led enrich the information as well as publish the technologies to the available customers (Kotler & Armstrong, 2010).
5 FORCES PORTER’S MODEL:
The Five Forces Analysis refers to the 5 Forces Porter’s Model which should be used as one of the techniques in order to audit the marketing environment. This analysis would help in providing an exact picture related to the level of competition in the external environment (Poter, 2008).
The five major forces which would be taken into consideration under the Porter’s Model would be as under:
Þ Threat to entry
Þ Bargaining power of supplier
Þ Bargaining power of buyers
Þ Threat of Rivals
Þ Potential new competitors
THREAT OF NEW ENTRANTS :
The first factor to be taken in to consideration in 5 forces model would refer to the threat of new entrants (Kotler & Armstrong, 2010). It must be noted that, if the new companies would enter in to the market quite easily then the existing players have to seek cut throat competition from the new players (Poter, 2008). Factors which must be kept in mind in order to limit the entry (barriers to entry) in case of telecom industry would be as under:
Þ High fixed costs
Þ Sacristy of the resources available
Þ Existing major brands in the telecom industry
Þ High switching cost
Þ Government restrictions or regulation
Þ Incentives to use a particular brand
POWER OF SUPPLIERS :
The second factor which should be taken into consideration in the 5 forces model would be the bargaining power of the suppliers. This would pressurize the suppliers in the telecom industry. When one supplier has a full impact, this would affect the productivity, increase the margin & enhance the volume of the sector as well. The individual supplier would have a full impact or power (Kotler & Armstrong, 2010).
Some of the factors to be taken into consideration would be as under:
Þ No substitutes
Þ Switching cost is low. The cost to switch to another brand is quite high
Þ Few suppliers for a particular product
Þ Product is very important in case of this sector
Þ There is high profitability in case of supplying industry as compared to the buying industry
POWER OF BUYERS :
The third factor which must be taken into consideration in case of 5 forces model would be the bargaining power of the buyers. It must be noticed that, if there is only one buyer then the impact over the company could be seen with a rise in the volume of sales or margins (Kotler & Armstrong, 2010). In this case the buyer or the customer would have high levels of power. Some of the ways in which the buyer would have power would e as follows:
Þ Less number of buyers
Þ The buyer purchases large amount of volumes
Þ Customers or the buyers would be price sensitive
Þ In this case, the buyers are not considered about the product. They can compromise over the product for some point of time.
Þ Switching cost is low
AVAILABILITY OF SUBSTITUTES :
Availability of Substitutes in case of telecom industry, should take into consideration as more substitutes means high levels of competition amongst the various brands. The cost of switching to another brand in this sector is quite low (Kotler & Armstrong, 2010). This also poses a serious problem as more people customers to shift their preference from one brand to another. Price refers to one of the most crucial factors which should be kept in mind.
COMPETITIVE RIVALRY :
Rivalry amongst the competitors in case of the telecom industry would describe the intensity of competition amongst the various brands. It should be seen that, telecom refers to one of the most competitive industries which would earn low returns due to high cost of competition. The telecom sector should take into consideration the following i.e.:
Þ No dominance in the firm
Þ Little differentiation amongst the product offerings
Þ Try to attract competitors customers
RADAR PLOT 1
Radar plot refers to a graphical representation which would display multivariate data depicting different types of quantitative variables, from the same starting point. The radar chart also refers to a spider web or an irregular polygon or a star chart or a kiviat diagram, etc (Hamel & Prahalad, 2008).
In case of telecommunication industry, the Spider or the Radar Chart could be identified as under:
The measurement of the radar plot has been done on the scale of 10. Highest rating has been given to two of the factors such as low cost provider & competitive advantage. 7 out of 10 rating has been given to broad band access follows:-
POLITICAL:
Political factor refers to the first actor while conducting the PEST analysis. It must be seen that government has supported the growth of the Indian automobile industry. It has allows 100% owners investment in case of the same. Government has also framed various
norms, legislations, in order to ensure appropriate fuel policy to meet the carbon emissions in the atmosphere (Hamel & Prahalad, 2008).
High levels of R&D have been done in order to innovate the products as per the need as well as requirements of the customers.
The political factors which should be taken into consideration would be as under. They are as follows:
Þ Antitrust regulations
Þ Tax laws
Þ Environmental regulations
Þ Incentives
Þ Stability of the government
Þ Protection laws
Þ Attitudes towards foreign companies
Þ Trade regulations all across the globe
ECONOMIC:
Economic factor refers to the second factor to be taken into consideration while conducting the PEST analysis. The rate of inflation is at peak & the International economy has been growing a high pace. Taxes have been reduced drastically i.e. approximately by 150% in order to increase the level of sales in the automobile sector (Hamel & Prahalad, 2008). Government has been granting high levels of concessions in terms of low rate of interest which has helped in export financing, etc. has granted concessions, such as reduced interest rates for export financing (Chambers, Cleveland, Kleiner & Paul, 2003). The growth in the Indian economy has been estimated to be approximately 8.5% per annum. The rate of growth in case of the engineering sector has been approximately by 8-10 % per annum.
The economic factors which should be taken into consideration would be as under. They are as follows:
Þ Trends in the GDP rate
Þ Effects of price
Þ Fluctuations in the interest rates
Þ Money supply in the economy
Þ Level of unemployment
Þ Devaluation or revaluation of the currency
Þ cost
SOCIAL:
The next factor to be taken into consideration refers to the Social aspect. Change in the culture, mind set up as well as purchasing power has led to an increase in the level of sales. Now days, the engineering sector has a huge cliental (Chambers, Cleveland, Kleiner & Paul, 2003).
The social factors which should be taken into consideration would be as under. They are as follows:
Þ changes in the life style
Þ Career Expectation
Þ Consumer activism
Þ Rate at which the population grows
Þ Shift in the population
Technological: The last factor to be taken into consideration while conducting the PEST analysis refers to the change in technology. More emphasis is being put upon the R & D activities. This has helped many companies to innovate & have an edge over its rivals. Change in the technology would help the organizations in order to increase the profits thereby reducing the amount of loss. Continuous feedback would help the organizations in order to have an access of all the data (Chambers, Cleveland, Kleiner & Paul, 2003).
The technological factors which should be taken into consideration would be as under. They are as follows:
Þ Protection of patent
Þ New products
Þ Innovation in the existing products
Þ Focus on the technological efforts
Þ Focus upon Research & Development
Þ Improvement on the productivity
Þ Transfer in the technology
DRIVERS TO CHANGE
Some of the drivers which would affect the engineering services could be listed a sunder. They are as follows:
Þ Regulation
Þ Privatization
Þ Upgraded Technology
Þ Levels of competition
Þ Creation of national regulatory authority
Þ Price Sensitivity
Þ 3G licensing
Þ Globalization
Þ Technology & Standardization
RADAR 2
The Second Radar Plot would refer to the various aspects after conducting the PESTEL analysis of the same. The various aspects in case of the telecommunication sector should be taken into consideration. These variables would be as follows:
The measurement of the radar plot has been done on the scale of 10. Highest rating has been given to innovation i.e. 9 out 10. 7 out of 10 rating has been given to competition followed by technology & standardization.
COMPARISON
After the comparison of both the Radar and Spider Chart, it could be analyzed that the demand in telecommunication sector is expected to rise at a high pace. The government has been liberalizing the various regulations which would help in the growth of the same. With the ongoing growth of the telecommunication sector, various factors such as up gradation of technology, liberalization of 3G, privatization, etc have been emerged (Buffet, 2011).
Some of the recent trends have shown that, telecommunication sector would provide various opportunities in the years to come. In order to judge the demand side for this industry, growth has been geared up. Use of the information technology (IT) in normal life has led to a change in the social as well as economic activity of the same. This has also led to change the existing system & enhance the productivity of the same. Convergence of telecommunication industry has led enrich the information as well as publish the technologies to the available customers (Buffet, 2011).
If you want IT management Assignment Help study samples to help you write professional custom essay’s and essay writing help.
Receive assured help from our talented and expert writers! Did you buy assignment and assignment writing services from our experts in a very affordable price.
To get more information, please contact us or visit www.myassignmenthelp.Com
