Porters five forces for telecom industry in india

This increases the industry attractiveness. Operating a cellular carrier requires specific human resources, with specialized skills. Additionally, they can be differentiated as either pre-paid or post-paid users.

Competitive Rivalry - This describes the intensity of competition between existing firms in an industry. These human resources are in limited supply and are expensive. Migration to the new market requires more upfront investments and thus hard cash availability with the providers becomes essential.

However, to minimize this high deployment costs, service providers have started considering infrastructure sharing, which has been discussed in Industry Transformation.

In order to allocate spectrum amongst competing service providers, auctions are often used. High costs of switching companies Government restrictions or legislation Power of Suppliers - This is how much pressure suppliers can place on a business.

The biggest barrier is the availability for credit financing which is highly dependent on many external factors.

Analysis of the Indian Telecommunication Industry

Despite technological changes that reduce the demand for spectrum, availability of spectrum continues to be a constraint. The preferred strategy among all competitors is to offer lower prices coupled with more value added services.

Purchases large volumes Switching to another competitive product is simple The product is not extremely important to buyers; they can do without the product for a period of time Customers are price sensitive Availability of Substitutes - What is the likelihood that someone will switch to a competitive product or service?

Thus, spectrum availability poses a huge barrier to entry, increasing the industry attractiveness. These increase strategic stakes for the players. The supplier for the telecom industry includes: If the cost of switching is low, then this poses a serious threat.

Bargaining power of suppliers: The service providers also incur expenses in procuring licenses and laying down network infrastructure. Moreover, it is always profitable to have the first mover advantage as it provides the opportunity to garner certain premium in pricing for services.

This has a damaging effect on the bottom line for the industry as whole, leading to commoditization of the market with decreasing individual market capitalization and makes the industry unattractive for the entrant.

There is almost no differentiation among the service providers regarding basic services, and even any innovations in value added services are quickly copied. Rivalry among competing firms: The market can be divided into household and industrial consumers.

Highly competitive industries generally earn low returns because the cost of competition is high. This makes the industry rivalry most prominent. Here are a few reasons that suppliers might have power: With each technology possessing inherent advantages as well as disadvantages, it presents a difficult proposition for a new entrant to decide on its offering.

It takes tremendous capital to build a cellular network, backhaul and operations center. Bargaining power of buyers: Also, the industrial users have customized offerings from service providers that bind them. For example, if the price of coffee rises substantially, a coffee drinker may switch over to a beverage like tea.

To garner these expenses, it becomes essential to have adequate capacity utilization.

Industry Handbook: Porter's 5 Forces Analysis

Here are a few factors that can affect the threat of substitutes: We see players in this market are the ones typically considering big business powerhouses in India Bharti Airtel, Relianceand they branch out into other industries as well.

Licensing also acts as a major barrier to entry as sometimes it becomes very difficult for the new entrants to obtain license. The industry suffers from high fixed costs and fast technology obsolescence. The main issue is the similarity of substitutes.Abstract— In this paper, we have discussed Porter Five Forces model and presented mobile communication The booming telecom industry has been presence through existing operations in all of India's 22 telecom circles.

The Hirschman-Herfindahl Index (HHI) for the Indian telecom industry stands at which indicate a highly contestable but oligopolic industry. Moreover, the concentration of top four firms at 66% also confirms this hypothesis. PORTER’S FIVE FORCES ANALYSIS OF US TELECOM INDUSTRY: Porter's 5 Forces analysis deals with factors outside an industry that influence the competition, the 5/5(2).

PORTER’S FIVE FORCES ANALYSIS FOR THE TELECOM INDUSTRY IN INDIA Prepared By Akash Agamya Great Lakes Institute of Management 2. Introduction India has a total of Million telecom subscribers, comprising of mobile subscribers & wire-line subscribers.

The Indian teledensity now stands at %. Telecom Sector in India. telecom industry ppt. Idea Cellular Strategy. Study of Competetive Strategies in Telecom Sector. Porter s Five Forces on Us Telecom Industry. Uploaded by. uday. Porter's Five Forces Analysis - Indian Automobile Industry 2.

Uploaded by. Ashish Mendiratta/5(12). Porter five forces analysis From Wikipedia, the free encyclopedia A graphical representation of Porter's Five Forces Porter five forces analysis is a framework for industry analysis and business strategy development.

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Porters five forces for telecom industry in india
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