Business case study on Bell - Assignment Example

Moreover, prior knowledge of these factors facilitates development of effective strategies for sustainable success, especially in the era of highly competitive global business environment. It was important for Ron Close to have in-depth understanding of these five forces for Bell Canada Enterprise before accepting the position of President, consumer VoIP for Bell Canada. The examination of these forces would enable him to assess the viability of VoIP (voice over internet protocol) within the operation of Bell or as a new venture, independent of the influence of Bell, in Canada.

Bell Canada was a leadership company in the field of telecommunication. It provided fixed line telephones and internet services to approximately 13 million customers in its core territory of Quebec and Ontario. It was also 14th largest company as per 2004 survey with major stake in Aliant, which operated in Eastern provinces. Through acquisition of fiber cable network and merger with other different media interests like print, television, IT etc., Bell not only provided fixed line, mobile services and internet, it also was in possession of huge network of fiber cable used for high speed internet which could hugely contribute to the success of VoIP.

Hence, evaluating the five forces would significantly influence the decision of Ron Close to accept or not to accept the challenge of being the president of VoIP division, Bell Canada. Answer 2 Competitive Rivalry Industry rivalry is an important element for developing distinct competencies and differentiating products to gain leverage in the market. Bell was pioneer in the telecommunication field in Canada with near monopoly. Bell’s main rivals in telephony were: Telus, which operated in British Columbia and Alberta; SaskTel in Sasketchewan; and 50 small telephone companies.

In the cable network, Roger, Cogeco and Shaw were key opponents in Ontario; and Videotron and Cogeco in Quebec. In 2005, all these firms had launched VoIP through high speed internet or HIS. While Cogeco and Videotron did not have nationwide network, Roger, Shaw and Bell had the advantage. But Bell had the leverage in the sense that it owned a satellite operator, Teleglobe and its vast network of cable spread across Western Canada that also extended to America which would significantly reduce the cost of infrastructure which may run in billions.

Most importantly, its market credibility and huge database of customers were crucial factors that could be turned into VoIP customers. VoIP is barrier free and therefore small players like Primus and Vonage become important as with relatively small investment they can offer continent wide internet telephony. Messenger from Microsoft and Skype have also emerged as popular VoIP service provider attracting huge numbers of customers from the globe. Answer 3 Supplier power Bell does not have suppliers except for the government from which it buys bandwidth for HIS.

But so far as customers are concerned, Bell is part of various other suppliers of VoIP services. This is important element that indicates the bargaining power of suppliers vis-a-vis provision of goods and service. When there are lots of suppliers, they have less bargaining power and operate within highly competitive environment. In the case of Bell, especially related to VoIP, there are some major suppliers who have good database of custo