Industry Analysis: Li-Fi

T able of Contents
Table of Figures ............................................................................................................................ 2
Table of Tables ............................................................................................................................. 2
Executive Summary ...................................................................................................................... 3
Introduction................................................................................................................................. 4
Li -Fi Technology Assumption ..................................................................................................... 4
Report Scope ............................................................................................................................ 4
Report Structure ....................................................................................................................... 4
Chapter 1 UK Broadband Industry.................................................................................................. 6
Current Technologies ................................................................................................................ 6
Current Market & Key Competitors ............................................................................................ 7
Future Market .......................................................................................................................... 8
Race Online 2012 .................................................................................................................. 9
Chapter 2 Porter’s Five Forces – Threat of New Entrants............................................................... 10
Product Differentiation ........................................................................................................... 11
Switching Costs....................................................................................................................... 12
Capital Investment.................................................................................................................. 13
Economies of Scale ................................................................................................................. 14
Supplier and Distribution Channels .......................................................................................... 15
Chapter 3 Conclusions ................................................................................................................ 17
Opportunities ......................................................................................................................... 17
Threats................................................................................................................................... 18
Recommendations.................................................................................................................. 19
Bibliography............................................................................................................................... 20
Appendix 1 – Ofcom Communication Facts & Figures.................................................................... 23

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T able of Figures
Figure 1 - C urrent UK Broadband Technologies ................................................................................................... 6
Figure 2 - UK Broadband Market Share - July 2011 (5) ..................................................................................... 7
Figure 3 - No of Broadband Customers UK ............................................................................................................. 8
Figure 4 - UK Broadband market Progress (4) ...................................................................................................... 8
Figure 5 – Selected Five Most Important Factors for Threat of New Entrants......................................10
Figure 6 - Electromagnetic Spectrum (18) ............................................................................................................11
Figure 7 - Li-Fi Technology Supply and Distribution Channels ....................................................................16
Figure 8 - Opportunities ................................................................................................................................................17
Figure 9 – Threats .............................................................................................................................................................18

T able of Tables
Table 1 - No of Broadband Customers & Prices in UK (5) (6) (7) (8) (9) (10) (11).............................. 7
Table 2 - Ofcom - UK Communications Facts and Figures (33) ....................................................................24

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E xecutive Summary
Li -Fi is a new visible light communication technology developed by the University Research Group.
The technology is a revolutionary approach in wireless communication in the UK home broadband market. The University Research Group has claimed that they can achieve 200 MB /S speed in the typical UK home environment.
The industry report provides information about UK home broadband market, the market leaders, technology used and plans. The major aim of this industry study is to analyse the attractiveness of l aunching a new company providing Li - Fi technology to UK households.
A threat of New Entrants is one of the Porter’s Five Forces. Five most important factors Product
Differentiation, Switching Cost, Capital Investment, Economies of Scale and Supply Chains have been analysed. Opportunities and threat have been identified and report concludes with list of recommendations. MSEC 31131 – Assignment 2: Industry Analysis

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I ntroduction
L i - Fi Technology Assumption
The University Research Group is not willing at this stage to disclose any information regarding its i nnovation or intellectual property for commercial reaso ns. (1) Hence, there is a basic technological assumption made to provide this analytical report.
Newly developed Visible Light Communication technology called Li -Fi is a total alternative method and technology currently used in providing wireless broadband communication services within UK households. However, Li -Fi would use existing wired internet broadband backbone infrastructure .

R eport Scope
The aim of this report is to analyse and evaluate prospect of starting a new company providing broadband communication services to UK household. There are choice of three i mportant business scenarios that can be analysed for University Research Group to enter UK home broadband market.
Business Scenario #1: Li-Fi as independent Internet Service Provider
Business Scenario #2: Li-Fi as VLC1 service provide to current and future ISPs2.
Business Scenario #3: License Li -Fi technology and earn royalties.
The analysis is performed using historical data and current information available via various sources such as Mintel reports and Ofcom data. The information and data are analysed with keeping maximum of 3 years in future of UK home broadband market.
The report analyses external business environment using Porter’s Five Forces. Threat of New
Entrants i s one of the PFFs 3 and only Business Scenario 2 is analysed for the purpose of this report.
The report also contains comprehensive analysis and conclusions identifying business opportunities and threats. The conclusion provides concrete recommendations to help URG4 make business decisions. R eport Structure
Chapter 1 focuses on UK Broadband industry including the technologies, market size, and key competitors. In addition, the f uture of UK home broadband market is also discussed.

VLC = Visible Light Communication
ISP = Internet Service Provider
3 PFFs = Porter’s Five Forces
4 URG = University Research Group
1
2

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Chapter 2 focuses on five most important barriers to enter UK home broadband market associated with Li-Fi technology.
Chapter 3 concludes report by identifying opportunities and threats with concrete recommendations. The word count for this report consisting of Introduction and from chapter 1 -3 is 3598 words. MSEC 31131 – Assignment 2: Industry Analysis

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C hapter 1 U K B roadban d I ndustry
The main aim of this section is to provide brief information about current technologies involved in providing broadband services in UK households . In this chapter, detailed information about UK
Broadband market is analysed.
Some detailed information about UK broadband market and customer market sh are by major companies has been analysed in this section. In addition, this section provides analysis for future of broadband in the UK household and corporate technologies.

C urrent Technolog ies
Currently there are four main technologies available whereby the broadband is delivered in UK household (2) and i s shown in Figure 1.

ADSL

Cable

Broadband
Fixed
Wireless
Accesss

Satellite

F I G U R E 1 - C U R R EN T U K B R OAD B AN D T ECH N OLOG I ES

These present technologies create the internet backbone for providing major communications services i n the UK such as internet, p hone and digital television. These technologies are evolving and maturing on commercial level where faster and higher broadband speed can be delivered. (3)

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C urrent Market & K ey Competitors
The present UK broadband market is very healthy and Figure 2 market share chart illustrates it very well. According to Ofcom, 2011 Q1, broadband penetration is 74% in UK households. (4)

UK Broadband Market % Share - July 2011
4%
4%

5%

2 9%
1 6%

2 1%
BT

Virgin Media

2 1%
Talk Talk

Sky

O2

Orange

Others

F IGU RE 2 - U K BROADBAND M ARK ET S HARE - J U LY 2 0 1 1 ( 5 )

The table 1 shows number of broadband customers in millions subscribed to major companies for the internet services. It also compares typical monthly subscription prices. We can conclude from above data that UK broadband market size is approx. £3.8 billion and calculation is show in equation below.

Market Size: Total Customers * (Average monthly price *12) ≡ £3.8 Billion
Company
BT
V irgin Media
TalkTalk
Sky
O2
Orange
Total
Customers

No of Customers
(in Millions)
5.832
4.314
4.172
3.161

Broadband Deal

Price/Month (£)

Broadband and Evening & Weekend Calls
Broadband XXL
TalkTalk Plus
Sky Broadband Connect

13
35
7.25
17

0.7
0.716

O2 Broadband
Broadband and Anytime Calls

13.50
15

18.895

Average Price

16.79

T ABLE 1 - N O OF BROADBAND C U ST OM ERS & P RIC ES IN U K ( 5 ) ( 6 ) ( 7 ) ( 8 ) ( 9 ) ( 1 0 ) ( 1 1 )

We can conclude from table 1 that there are four major companies in the market and each one of them holds significant percentage of market share. Figure 3 illustrate that there are four major companies BT, Virgin Media, Sky and TalkTalk having over 90% of market share.

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No of Customers by companies (%)
3% 4%

3 1%

1 7%

2 2%
2 3%
BT

Virgin Media

Talk Talk

Sky

O2

Orange

F IGU RE 3 - N O OF BROADBAND C U ST OM ERS U K

These four companies are major competitors in the home broadband market and all of them provide home phone line as well. To differentiate a company from their competitors, most of them have started adding different bundled package deals such as television, digital contents and recording.
Except TalkTalk, other three companies provide identical services in similar price range of each other. Therefore, there is very little to differentiate between in their overall offer.

F uture Market
The future of broadband in UK is very promising. In the Autumn Statement from Chancellor
George Osborne said (12) that he would create “new superfast digital networks for companies across our country”.

F IGU RE 4 - U K BROADBAND M ARK ET P ROGRESS ( 4 )

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The prediction of near future market can be made by analysing trends from the past. Figure 4 above shows the increased trends in usage of personal computers, mobile phones. In addition it also show the rapid increase in total broadband connection in past 5 years which is predicted to grow. Race Online 2012
In year 2010, the broadband penetration was 70%. “Race Online 2012” was an i nitiative started to get rest 30% online before London Olympic 2012 (13) . The latest statistics from Ofcom (4) shows that home broadband penetration has increased to 74%.
Race Online 2012 is a government initiative to get as many people as possible to get online by the
London 2012 Olympics (13) . Race Online 2012 team has an ambition to make the UK the first nation i n the word where everyone can use the web.
Race Online 2012 has launched various campaigns collaborating with universities, libraries, multi national companies and individuals. One of the recent campaign “Go on Give Hour” l aunched on 30
October 2011, which encourages people to spend extr a hour helping people go online (14) .
All the detailed information about Race Online 2011 such as their vision, manifesto, partners and campaigns can be found on their official website: www.raceonline2012.org

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C hapter 2 P orter’s Five Forces – T hreat of New Entrants
According to Oxford University Press (15) “The external environment is tremendously complex and dynamic. Take your eyes off it for a moment and you may find there has been a significant change in the competitive landscape.”
There are number of many barriers associated for new entrants in the existing broadband marketplace. In this chapter, five most important barriers for new entrants have been identified namely, Product Differentiation, Switching Cost, Capital Investment, Distribution Channels and
Economies of Scale.

Product
Differentiation

Supplier and
Distribution
Channels

Threat of New
Entrant

Economies of
Scale

Switching Cost

Capital
Investment

F IGU RE 5 – S ELEC TED F IVE M OS T IM PORTANT FAC TORS F OR THREAT OF NEW EN TRANTS

These five barriers to new entrants are very important and crucial for making any conclusive business decisions. These five barriers are discussed below in detail achieve whether Business
Scenario #2 is a good option for University Research Group.

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P roduct Differentiation
Li -Fi provides total product differentiation in the field of Wireless Communication. The Visible Light
Communication is a revolutionary change in wireless connectivity of Internet in the UK households.
Li -Fi has many advantages over current Wi -Fi technology and 3 most important benefits are discussed below.
1. Speed
According to Ofcom (16) , the average UK broadband speed has increased by 10% from 6.2
MBPS5 i n November/December 2010 to 6.8 MBPS i n May 2011.
University Research Group claims that (1) using Visible Light Communication, the data transfer speed of 200 MBPS can be achieved for UK domestic customers. Assuming these claim is based on current broadband infrastructure, this is a significant increase in speed for wireless broadband connectivity.
2. Spectrum Availability
Wi -Fi uses the radio waves for transmission of data (17) whereas Li -Fi uses the visible light for wireless data transmission. The figure 6 below is of Electromagnetic Spectrum and i ndicates that visible light has 10000 times more frequency spectrum than radio waves.

F IGU RE 6 - E LEC TROM AGNETIC SPEC TRU M ( 1 8 )

The major benefit of this available spectrum is that high speed wireless communications can be achieved in such locations namely hospitals, aeroplanes where wireless co mmunication is not possible with radio waves.
Unlike radio waves, visible light does not penetrate through walls and with it the issue of frequency channels associated with each router in neighbourhood is resolved.

5

M BPS = Mega Bit Per Second
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3. Security
Security is one of the biggest concerns with home broadband connection and Wi-Fi system has many flaws associated . One of the major flaws is l ack of user awareness and knowledge of security implications .
Wi -Fi uses the radio wave signals for transmitting data and radio waves has property that it penetrates through walls and can be accessed outside of the house. According to survey findings published in ISPReview, (19) “58% admit to having used somebody else’s broadband connection without permission and 29% saw absolutely nothing wrong with practice”. The new study conducted by Information Commissioner’s Office also shows that 40% of home
Wi -Fi users don’t understand security settings (20) and shockingly only 3% of the users change their Wi -Fi network password ones a month or more often (21) .
These concerns can be mitigated with Li-Fi technology because visible light cann ot penetrate walls. In essence, the Li -Fi can provide private and protected wireless connection in households without any issues of neighbourhood snooping and/or accessing network outside the house.
In summary, Li -Fi provides total alternative for wireles s communications in UK households. Above points also illustrate that benefits of Li-Fi such as Speed, Availability and security has significant advantage over current Wi -Fi system. To conclude, Li-Fi is not just an alternative to Wi -Fi but a significant advancement i n wireless communication benefiting broadband users’ needs.

S witching Cos ts
Switching Cost is one of the biggest barriers of new entry that has major dependency on whether Li Fi technology can be converted into a successful commercial business.
According to Office of Fair Trading (22) , “Switching costs arise when there is a cost incurred by changing supplier that is not incurred by remaining with the current provider. These costs typically arise due to some firm-specific investment that is not transferable to the new supplier, such as i nvestment in equipment or in learning how to use a firm’s products ”.
We are analysing Business Scenario #2 and for that reason, Hardware Compatibility and Cost are two most important factors that affect Internet Service Providers and customers.
Currently almost all hardware that can connect to internet i s Wi -Fi enabled devices including wireless printers and portable music players. Therefore, Li -Fi has very strong competition w ith a l arge market share of Wi -Fi compatible devices.
1.

Availability & Usability of Li-Fi compliant LED lights
V isible Light Communication relies heavily on LED 6 l ight bulbs for data transmission . The market availability of these Li-Fi compliant LED bulbs is extremely important. In addition, the usability of these LED bulbs with current home electric wiring is another catalyst.
The manufacturing and retail costs of LED are major factor for Internet Service Providers and customers wishing to switch from Wi -Fi to Li -Fi respectively.

6

LED = Light Emitting Diode
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2.

Li-Fi compatible Adapters for Wi-Fi enabled devices
Li -Fi must produce a receiver (or an adapter) that is compatible with current Wi -Fi enabled hardware available in market. This will provide a platform to launch Wi -Fi  Li -Fi switching program. The cost per adapter is very important factor for ISPs. These Li -Fi adapters can be provided to customers’ part of the broadband package via their ISPs to provide easy technology switch over. These adapters’ can be manufactured on an industrial scale in partnership with current Wi -Fi router companies such as NETGEAR and Linksys.

3.

Li-Fi compatible Adapters for new hardware
University Research Group (URG) must work in partnership with all hardware manufacturers producing laptop s, mobile phones and tablets to incorporate Li -Fi receivers i n their new hardware. The wider availability of new hardware devices is very important for l ong-term success of the business.
The partnership with wide array of manufacturers can is possible throug h technology l icensing where both URG and hardware manufacturer has stake i n the technology being successfully adopted in consumer market.

In summary, Switching Cost is the most important barrier to entry in the broadband market.
However, by creating adequ ate technological awareness and providing sound hardware compatibility at competitive cost then this factor can be mitigated.

C apital Inves tment
According to Michael Porter (23) “The need to invest large financial resources in order to compete creates a barrier to entry, particularly if the capital is required for unrecoverable expenditures in up front advertising or R&D. Capital is necessary not only for fixed facilities but also for customer credit, inventories, and absorbing start-up losses.”
We are analysing Business Scenario #2 and f or any new start-up business, capital investment is very critical and important factor. I t has direct correlation between company staying small or growing big.
Financial Investment is very i mportant for three most following factors.
1. Producing new VLC receivers - Li-Fi Adapters
As mentioned earlier, Li -Fi is a total alternative to wireless communication and it must be compatible with current Wi- F hardware. Assuming URG has patents and technological e xpertise; the company must produce number of Li -Fi adapters compatible with Wi -Fi e nabled devices. The important p urpose of these adapters is for Pilot Testing.
The cost involved at start will be higher because only small and fixed number of adapters is being produced. Ones the pilot is successful and ISPs start rolling out Li -Fi broadband, more adapters can be produ ced in l arge quantities, which can significantly reduce adapter cost per unit.
2. Piloting Li-Fi technology in partnership with ISPs
According to NC3Rs (24) , “A pilot, or feasibility study, is a small experiment designed to test logistics and gather information prior to a larger study, in order to improve the latter’s
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quality efficiency. A pilot study can reveal deficiency in the design of a proposed experime nt or procedure and these can be addressed before time and resources are expended on large scale studies.”
Piloting Li -Fi technology has some initial cost associated up front. However, piloting i n partnership with ISPs has three most important advantages.
a. Convincing ISPs and associated partners is that Li -Fi technology works in real life scenarios and provides superior services of wireless communication.
b. Analyse pilot study results and improve technology and/or procedure for l arge-scale deployment. c. Create market buzz and start marketing the new revolutionary wireless communication technology
3. Consumer Awareness & Marketing
According to Chartered Institute of Marketing (25) , “The management process responsible for identifying, anticipating and satisfying customer requirements profitably .”
Marketing is the most important aspect when launching new tech nology into an existing market. All major broadband companies use various ways such as emails, flyers, television advertisements to market latest broadband deals to existing and new customers.
The success of Li -Fi has significant importance on how University Research Group works with ISPs to promote new technology to customers. T he consumers awareness program is very i mportant that includes technology introduction, how it works, benefits over the e xisting technologies and its differentiating properties.
The financial investment is greatly required up front for marketing Li -Fi and must be budgeted in the plans.
In summary, finance is very important of any business but for the new start -up, it is one of major barriers to entry.

E conomies of Scale
Britannica defines (26) , “The relationship between the size of a plan or industry and the lowest possible cost of a product. When a factory increases output, a reduction in the average cost of a product is usually obtained. This reduction is known as Economies of Scale.”
UK has 74% of home broadband penetration (4) and with increase in governmental policies of bringing remaining 26% online; the future of broadband services i s bright. University Research
Group can scale Li-Fi technology to reach almos t all home broadband customers. To achieve this, the rise in usage of wireless communication within UK households is very important.
There has been a steady increase in use of hardware devices enabling wireless communication .
There are three main types of hardware devices via which customers’ uses internet wirelessly.

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1. Laptop PC: Laptops are becoming very popular in British households and according to Mintel report, in 2011 (27) , 55% of UK households have laptops leaving desktop s with 46% in second position.
2. Mobile Phones: Mobile phones have become important form factor and users are i ncreasingly accessing internet from it whether they are connected via home broadband network and/or cellular mobile connection. According to BBC (28) , 30 million mobile phones are sold in UK every year.
3. Tablets: Tablet computers have been around for very long time however they are becoming popular in UK in past two years. According to Guardian (29) , currently 3.62 million people own tablets and further 2 million more are predicted to be sold next year. In addition, 90% of them have connected them to a Wi -Fi network at home.
Television is one the product that has potential to be connected to i nternet via home broadband network but somehow, the concept has not taken off. According to Mintel report 2011 (30) , “Some
29% of consumers agree that they would pay extra for a TV with Wi-Fi capabilities while 24% agree they would pay extra for radio or music player with Wi-Fi capabilities”.
From above, we can conclude that personal computers and home entertainment devices in portable forms are increasingly becoming an i ntegral part i n current UK household s. Li -Fi technology can perform a critical role in providing super -fast home broadband speed that will allow higher bandwidth data communication on different platforms at the same time.

S upplier and D istribution Channel s
We are analysing Business Scenario #2 and for that reason, there is a significant importance on supply chain of Li-Fi technology. To start a company as a supplier to Internet Service Providers, the company itself must establish an efficient supply chain.
According to Marquis Codjia (31), “An organisation needs to build and nurture effective relationships with its vendors to secure good prices for materials and services.”
University Research Group must consider some of the following questions directly related to supplier chain. The outcome of these questions has direct impact on capital investment requirements and consumer switching costs.





How much is the current production capacity and expected future capacity of Li -Fi compliant LED light bulbs?
Who can manufacturer Li-Fi receiving adapters? What will be the cost?
Which hardware manufacturer will embed Li-Fi receivers in the new hardware?
How cost reduction in manufacturing and supplying of Li-Fi technology cost per unit can be achieved?

Above questions are the first four of many questions regarding supply chain that has huge importance on success of the new company.
Figure 7 shows the high-level view of the Supply and Distribution channels associated with Li -Fi technology. This custom generated diagram also indicates various types of partnerships and deals which can benefit University Research Group as a business.

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University Research Group : Li-Fi Technology Supply and Distribution Channel (High Level View)

LED Light
Manufacturer(s)

Mobile Phones &
Tablets Hardware
Manufacturers

PC Hardware
Manufacturers
License new Li-Fi technology to create Li-Fi enabled devices and bring them to market

Provides new Li-Fi enabled mobile phones and tables

Provides new Li-Fi enabled
PCs, Laptops
Customer

Produces special Li-Fi compliant
LED Light Bulbs

Li-Fi compatible
Adapter
Manufacturer(s)

University
Research
Group
(Company)

Produce Li-Fi adapters compatible with Non LiFi devices

Provides Li-Fi Broadband
Internet service

Internet
Service
Providers
Provides Li-Fi technology to ISPs with support of Li-Fi supply chain consisting Li-Fi compatible adapters and LED Light Bulbs

F IGU RE 7 - L I - FI TEC HNOLOGY SU PPLY A ND DISTRIBU TION C HA NNELS

In summary, Supply and Distribution Chain Management is one of the most important factors that can increase growth of Li -Fi technology adaptation, achieve reduction in overall cost and increase profitability. MSEC 31131 – Assignment 2: Industry Analysis

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C hapter 3 C onclusions
In this chapter, we draw conclusion on all the factors analysed in this report. The conclusions are made with logical reasoning of identifying opportunities and threats associated if University
Research Group starts a company with Li-Fi technology. SWOT is one of the most widely used analytical techniques to identify business opportunities and threats from external factors.
In this chapter, there are also some recommendations for Univ ersity Research Group. These recommendations are based on logical reasoning and analysing external factors discussed in the report. O pportunities
An o pportunity is any favourable situation in the external environment, which has potential of improving performance and increase customer/product base (32). Figure 8 illustrates all the major opportunities that can benefit University Research Group.

• UK home broadband market is established and growing .
• Wirelss commnunication is growing . There are increasing number of hardware devices s old s olely replying on wirelss communication.

Opportunities

• UK Govenment is on home broadband s trategy. They are working in partnership with regulators and funding various programs to increase broadband reach and s peed by 2012 and 2015 respectively.
• UK home broadband customers are focusing on s peed and reliability when choosing Internet Service Provider.

• UK Home entertainment market is growing and increasingly becoming Internet enabled. Along with large established market of personal computers, mobiles ; the economies of scale can be achieved. F IGU RE 8 - O PPORTU NITIES

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T hreats
A threat i s any unfavourable situation in the external business environment, which has factors potentially affecting company’s strategy (32) . Figure 9 illustrates the major external threats that have potential of damaging business strategy and company as a whole.

• Switching Cost from Wi -Fi to Li-Fi for Internet Service Providers
• Switching Cost from Wi -Fi to Li-Fi for home broadband customers
• Licensing and manufacturing Costs for Li -Fi receiving adapters
Threats

• Intellectual Property protection and product substitution of Li -Fi against other Visual Light Communication technology
• Improvements in current Wi -Fi technology

• Lack of access and control over Li -Fi technology supply chain

F IGU RE 9 – T HREATS

In summary, the best strategy would be to exploit and take advantage of all opportunities presented and negate or compensate on all arising threats.

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R ecommendations
In this report, the Threat of New Entrant and associated five most important barriers have been analysed and evaluated in detail. The purpose of this study was to evaluate attractiveness for Li Fi technology to launch as a company. Therefore, the simplest conclusion is below.
University Research Group can launch a new company with Li -Fi technology as a V LC service provider to current and future ISPs (Business Scenario #2). There are many o pportunities in the current UK home broadband market place to achieve success.
However, there are some important recommendations for University Research Group to consider before starting a company and list is below .
1. Thoroughly understand and evaluate all the discussed factors of Threats of New
Entrants.
2. Understand and plan how to exploit external business opportunities.
3. Understand and plan against potential threats from external factors.
4. Build partnership with ISPs and pilot new system in small environment to prove and improve the system.
5. Build a supply chain to provide Li-Fi compliant LED light bulbs, compatible adapters for all kind of hardware.
6. Reduce the minimal and maximum cost of switching from Wi-Fi to Li-Fi.
7. Extensive Consumer Awareness Marketing
The above recommendations are for next 3 years of UK home broadband market. They provide high-level approach to consider for the business planning and strategy.

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B ibliography
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11 12 2011.] http://www.ico.gov.uk/news/latest_news/~/media/documents/pressreleases/2011/wifi_guid ance_news_release_20110316.ashx.
21. YouGov. Wi-Fi Settings Research. Information Commissioner's Office. [Online] 04 03 2011.
[Cited: 12 12 2011.] http://www.ico.gov.uk/~/media/documents/library/Corporate/Research_and_reports/wifi_se ttings_research_by%20yougov_for_ico.ashx.
22. Dr Amelia Fletcher, Office of Fair Trading. Switching Costs. Department of Trade and
Industry. 2003. p. 11, Economic Discussion Paper 5.
23. Porter, Michael E. HB - How Competitive Forces Shape Strategy. s.l. : Harvard Business
School, 1979. p. 3.
24. Doug Altman, Norman Burton, Innes Cuthill, Michael Festing, Jane Hutton, Laura
Playle. Why do a pilot study? National Centre for the Replacement, Refineme nt and Reduction of
Animals in Research. [Online] 2006. [Cited: 14 12 2011.] http://www.nc3rs.org.uk/downloaddoc.asp?id=400. 25. Definition of Marketing. The Chartered Institute of Marketing. [Online] [Cited: 14 12 2011.] http://www.cim.co.uk/resources/understandingmarket/definitionmkting.aspx. 26. Economy of Scale. Britannica. [Online] [Cited: 15 12 2011.] http://www.britannica.com/EBchecked/topic/178584/economy -of-scale.
27. Mintel. Desktop, Laptop and Tablet Computers - UK - August 2011. Mintel Reports. [Online]
08 2011. [Cited: 10 12 2011.] http://academic.mintel.com/sinatra/oxygen_academic/search_results/show&&type=RCItem&s ort=relevant&access=accessible&archive=hide&source=non_snapshot&list=search_results/disp lay/id=545485/displaytables/id=545485/display/id=591355&?select_section=591354. 28. BBC. BBC Technology. BBC. [Online] 09 07 2010. [Cited: 10 12 2011.] http://www.bbc.co.uk/news/10569081. MSEC 31131 – Assignment 2: Industry Analysis

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29. Charles Arthur, The Guardian. Guardian Technology - Tablet Computers. [Online] 12 09
2011. [Cited: 10 12 2011.] http://www.guardian.co.uk/technology/2011/sep/12/apple-tabletmarket-share-set-to-fall.
30. Mintel. Internet-enabled Home Entertainment - UK - march 2011. Mintel Reports. [Online]
03 2011. [Cited: 10 12 2011.] http://academic.mintel.com/sinatra/oxygen_academic/search_results/show&&type=RCItem&s ort=relevant&access=accessible&archive=hide&source=non_snapshot&list=search_results/disp lay/id=545445/display/id=545445. 31. Codjia, Marquis. What is Supply Chain Management Software? eHow. [Online] [Cited: 15 12
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32. Management Technology Policy, Institute of Manufacturing. University of Cambridge.
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33. Communication UK - Facts and Figures. Ofcom. [Online] [Cited: 05 12 2011.] http://media.ofcom.org.uk/facts/. 34. G.D. Karagiannopoulos, N. Georgopoulos, K. Nikolopoulos. Forthoming Porter's five forces model in the internet era. Info. 2005, Vol. 7, 6, pp. 66-76.

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A ppendix 1 – O fcom Communication Facts & Figures
Here are the latest facts and figures about communications in the UK. (33)

Internet
Number of fixed residential broadband connections in the
UK
Proportion of adults with broadband in the UK (fixed + mobile) Proportion of adults with mobile broadband in the UK
What is the market share of the major fixed broadband providers in the UK? (connections)

18.0 million (End 2010).

74% (Q1 2011)

17% (Q1 2011)
BT 28%,
Virgin Media 22%,
TalkTalk Group 22%,
Sky 15%,
Everything Everywhere 4%,
O2/BE 3%
6.8 Mbit/s (May 2011)

Average actual broadband speed in the UK
Proportion of adults with a social 48% (Q1 2011) networking profile
Proportion of people who use
32% (Q1 2011) their mobile to access the internet Number of mobile broadband
4.8 million (end 2010)
(Dongles/PC datacard) s ubscriptions

Landline/mobile phones
Number of residential fixed landlines in the UK
Number of fixed landlines in the
UK, including ISDN channels
What is the market share of fixed line providers in the UK?
(voice call volumes)
Proportion of adults who personally own/use a mobile phone in the UK
Proportion of adults who live in a home that has a mobile phone but no landline phone in the UK
How many PAYG mobile

23.7 million (end 2010)
33.4 million (end 2010)
BT 37%,
Virgin Media 12%, other direct 18%, other indirect 33% (end 2010)
91% (Q1 2011)

15% (Q1 2011)

51% (Q1 2011)
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s ubscriptions in the UK ?
Number of text messages sent per mobile subscription per month What is the market share per mobile provider in the UK?
(connections)

Number of 3G mobile s ubscriptions in the UK

133 (in 2010)

Everything Everywhere (inc Virgin Mobile) – 38%
O2 (inc Tesco) – 30%
Vodafone – 25%
3UK – 7%
(end 2010)
33.1 million (end 2010)

Digital television
Proportion of UK homes with digital TV
Number of TVs in the UK
Number of HD TVs in the UK
Number of minutes of TV people aged 4+ watch each day
Number of UK homes with
Freeview on any set
Proportion of UK homes with
Freeview on their main set

93% (Q1 2011)
60m (end 2010)
24m (Q1 2010)
242 (average in 2010)
74% (Q1 2011)
38% (Q1 2011)

Digital radio
Proportion of households with access to a DAB Digital Radio
Proportion of listener hours through a digital platform (DAB, online, DTV)
Number of digital radio stations
Number of local radio stations
(excluding community stations)
Number of national radio s tations

37% (Q1 2011)
26.5% (Q1 2011)

216 (end 2009)
344 (July2011)
21 (July 2011)

T AB LE 2 - O F COM - U K COMMU N I CATI ON S F A CTS AN D F I G U R ES ( 33)

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