Essentials of Telecommunications Management - Assignment Example

Business-Level and Corporate-Level Strategies Answer There are more than 243 million subscribers of AT&T in US. It actually represents the market penetration of 81%. Moreover, the wireless market sells the mobility of data and voice (Plunkett, 2009). Business-level strategies AT&T has implemented several unique business strategies over the years. Effective business-level strategies like cost-leadership strategy, differentiation strategy, master strategy and unique marketing strategy has made AT&T a strong brand name in US telecommunication industry. Several strategies are described below. Cost Leadership strategy In order to lead the competitive telecommunication market in US; AT&T has placed to present the competitive pricing to frequent services which is being offered by the company. For an example providing services in US market like Family Unity Plan, Rollover Minutes are the implementation of effective cost leadership strategy. Moreover, AT&T provides GSM, TDMA and UMTS services. These are the example of niche marketing activities. Differentiation strategy AT&T has started to sell their wireless and GSM services in iphone, collaborating with Apple Corporation (Grant and Meadows, 2012). Its exclusive accord to competitive market place has differentiated AT&T from its potential competitors. Vast spectrum utilization of AT&T offers its subscribers the video conferencing service. Marketing and Master Strategy AT&T wireless is the only telecom company in US market that promises; people can get connected with each other anywhere and anyway by its efficient telecom service. AT&T has successfully diversified their business in several international markets. It is the leading wireless service provider in global market that provides Voice-IP, Voice-PTT, HSPDA and video sharing. Moreover, efficient channel exposure has increased the competitive advantage of AT&T. Answer 2 The story of AT&T depicts the 130 years old history. The old giant company has efficiently served the customers in telecommunication sector. From the foundation in 1875 by Graham Bell to this present era, the global telecommunication industry has evidenced several key events of AT&T. The study focuses on the corporate-level strategies of AT&T. Corporate-level Strategies Graham bell invented telephone in the year 1875. Since then slowly and gradually after almost 250 years the company AT&T has diversified their business successfully in global market. After the successful invention of telephone in the year 1875 by Graham Bell, the company has diversified their business. The vertical integration of the company created the opportunity of transferring the corporate skills of the company. In an addition, BTC also did acquisitions of many licenses. It actually increases the market power of BTC. Years after years the both vertical and horizontal integration helped BTC to create the economies of scope. Moreover, they have continuously generated the know-how technology. The monopolistic status of the company resulted many filed regulation suits. At one point of time AT&T lost the brand image and huge market share due to the huge competition in existing market. Therefore, the ability to reach in every house has reduced. AT&T is still the huge revenue generating companies but some inadequate corporate-level strategies give key chance to the competitors to lead in market. In order to overcome several problems, they have planned to diversify in several sectors. Therefore, few synergies have been created on the account of diversification. Last but not the least, this strategy also failed. Today there are few synergies that are established in global market. Answer 3 In order to analyze the competitive environment to determine the most significant competitor of AT&T; Porter’s Five Force model can be implemented. This model analyzes the impact of several competitive elements on the business performance of an organization. Analysis of competitive environment (Porter’s Five Force Analysis) Porter’s five force models analyzes the industry rivalry, threat of new entrants in the industry, buyer’s bargaining power, threat of the substitutes in the industry and supplier’s bargaining power. All the elements are described below. Industry Rivalry AT&T had to face limited competition in US market from the starting years. After globalization and introduction of advanced technology the competition has increased in global telecommunication market. The major competitor of AT&T in US market is Verizon. These two are leading players in US telecommunication industry. In order to expand network, strategically AT&T has introduced 3G and $G network. With regular product and service diversification AT&T continues to be the leading service provider in US telecommunication sector due to the superior network, effective cost leadership strategy and supreme customer service. Therefore, it is feasible that the threat of industry rivalry for AT&T is moderate. Threat of New Entrants AT&T is the most popular and oldest telecommunication company. Today the company has diversified their products and services by targeting in all the areas like wireless, internet, landline, and broadband, GSM, telephone and many more. As a new company has to face limited entry barrier, the new companies try to enter and provide similar products and services in the potential market place. It is the huge brand image and brand loyalty, by which AT&T is still leading the industry. Therefore, it can be state that AT&T has to face limited challenges from the new entrants. Threat of Substitute In terms of AT&T the threat of substitute is high due to the several implementations of substitute services by the competitors. Usage of advanced technology has increased the competitive strength of the competitor like Verizon, but the effective business level strategy and differentiation strategy of AT&T has made them leading player within the industry. Using switching cost can discourage the consumers to go for other companies. Looking into these factors it can be state that threat of substitute is high (Constable and Somerville, 2003). Bargaining power of buyers In us there are many telecommunication Service providing companies. Therefore the consumers easily can switch over to other companies in order to get service in low price. Several cost saving plans for subscribers have increased the brand image effectively in customer’s mind. After analyzing these factors it can be identified that bargaining power of buyers is moderate (Ugarkar, 2010). Bargaining power of suppliers The suppliers are available by large number in this industry. The company can choose cost effective suppliers and can cut down the additional operational cost. Therefore, it is feasible that the supplier’s bargaining power for AT&T is quite low. Answer 4 Answer 4 will determine whether the company AT&T will lie in slow cycle market or the fast cycle market considering the competitive environment analysis. It can be concluded that AT&T will lie in both of the cycle market. In the early years AT&T was the leading company within the industry. Slowly and gradually AT&T diversified their products and services. The company has created almost monopolistic market due to the limited competitors and substitutes in global market. They were the only distributer. It is the perfect example of slow cycle market as AT&T has to face limited competition. In slow cycle market the companies do not need to diversify the products and services as the business remain stable and very much certain. Moreover, the negative impact of several competitive environmental factors on the business performance was limited. Therefore AT&T has enjoyed the huge profit and brand name for a longer period of time. The total scenario has changed after the Second World War. Every company in present era wants to capitalize on the advantages of globalization. Advanced technology, modern information strategies and the increasing demand of people has increased the competition level for the companies. Therefore, the competitive existence is becoming uncertain in global competitive market. Rapidly the business environment is changing too. Huge number of new companies and several new diversified products is being introduced due to high demand of customers. Therefore, in order to survive in competitive market, companies need to diversify their products and market regularly. These are the examples of fast cycle market. In terms of AT&T, they have regularly diversified their products and services. Moreover, the company has implemented the international diversification strategy in order to achieve huge market share. The effective business level strategies like cost leadership strategy, product and service differentiation strategies are implemented by AT&T in their business model which helped to gain the competitive advantages in global market place. As the global business environment is changing rapidly, and the telecommunication industry is getting saturate, AT&T has to continuously diversify their products and services. References Grant, A. and Meadows, J. (2012). Communication Technology Update and Fundamentals. Waltham: CRC Press. Plunkett, J. (2009). Plunketts E-Commerce and Internet Business Almanac 2009. Houston: Plunkett Research Ltd. Ugarkar, J. (2010). The Essentials of Telecommunications Management. Bloomington: AuthorHouse. Constable, G. and Somerville, B. (2003). A Century of Innovation. Washington: Joseph Henry Press. Read More