...COMPANY PROFILE: Orange is a French telecommunications operator, previously known as France Telecom, it was operated and regulated by the French Ministry of Posts and Telecommunications. In an effort to create competition in the public services sector, France Telecom was ordered to privatize and comply with European directives in 1998. In order to expand globally, France Telecom acquired Orange, a UK mobile operator, in 2001. This led to a re-branding strategy and France Telecom grouped all its operations as well as its products and services under a single brand - Orange. Today, Orange provides a broad range of telecommunication services, including fixed-line and mobile telephony, internet, multimedia services such as television and digital services for both consumers and businesses. Orange is the eight largest telecommunications operator in the world with almost 210 million customers globally and €45.5 billion in sales. Orange operates in 32 countries, primarily focussing on Europe, Middle East and Africa and has 169 000 employees. In response to globalization, deregulation and the internet revolution, Orange’s management team have instituted a policy of proactive and continuous review of strategy, organization, and market position, which allows Orange to quickly anticipate and react to changes in the market. In less than two decades, Orange has managed to emerge from a local, government sponsored and regulated telephone operator to a successful, market leader in global...
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...The Mobile Phone Industry The market for mobile phones is enormous, with media regulator Ofcom reporting in Q1 of 2012 that 92% of the adult population in the UK own at least one mobile phone – this figure could have risen further as we are now in Q1 of 2013. What's more, four out of five children are expected to own a mobile phone by the age of 11 years old. With many people calling this the digital age, it is difficult for people now not to own a mobile phone. The mobile phone industry also poses a massive threat to other industries. An example of this is that most mobile phones now come complete with an inbuilt camera. Is the massive mobile phone industry the main reason behind the well-publicized collapse of camera firm Jessops earlier this year? (Fig A) See in figure A that demand for mobile phones shifts from D1 to D2, thus more are supplied. The mobile phone industry consists of two main sectors: manufacturers and network operators. Manufacturers: The demand for mobile phones is ever growing; in 2011 there were approximately 81.6 million active mobile phone contracts in the UK. Because of this, we see the ‘mobile phone’ evolve each and every year. It’s not surprising that we are still seeing massive changes today. From 1998 until 2012, Nokia was the biggest mobile phone manufacturer worldwide. Today, a ‘Nokia Brick’ is not accepted by society and as a result Nokia has suffered declining market share due to the likes of Apple’s iPhone and Samsung’s Galaxy line...
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...Orange Telecom Background Orange is the key brand of France Telecom, one of the world's leading telecommunications operators. With more than 131 million customers, the Orange brand covers internet, television and mobile services in the majority of countries where the Group operates. At the end of 2009, France Telecom had sales of 44.8 billion euros (33.7 billion euros for the first nine months of 2010). At 30 September 2010, the Group had a total customer base of 203 million customers in 32 countries. These include 144.5 million mobile customers and 13.3 million broadband internet customers worldwide. Orange is one of the main European operators for mobile and broadband internet services and, under the brand Orange Business Services, is one of the world leaders in providing telecommunication services to multinational companies. The brand was created when Hutchinson Telecom acquired a controlling stake in Microtel Communications Ltd during the early-1990s and rebranded it Orange. It became a subsidiary of Mannesmann in 1999 and was acquired by France Telecom in 2000. With its industrial project, "conquests 2015", Orange is simultaneously addressing its employees, customers and shareholders, as well as the society in which the company operates, through a concrete set of action plans. These commitments are expressed through a new vision of human resources for employees; through the deployment of a network infrastructure upon which the Group will build its future growth; through...
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...boost/effect on the competitiveness of a business as firms are able to buy out or merge with other large firms, in either their market place or another, to make one big firms in the market. The main firm will gain a larger percentage of the market at the two original market shares of the business are joint together. An example of this happening is in the mobile phone industry with the merger of Orange and T-mobile. This merger had brought together two of the UK’s biggest mobile phone networks and as a result gained them a combined 30 million customers, which meant they had overtaken O2 as the market leaders with a 37% market share. Furthermore, because of the two networks merging it provided them with a USP as it allowed customers to be able to receive signal of both networks to help provide a better signal range. The integration of the two businesses therefore helps both orange and T-mobile to provide a better service to its customers which in turn can tempt customers of other phone networks to use them and therefore gain them even more market share. Moreover, the merger has allowed Orange and T-mobile to compete with the main phone networks like O2 on specific...
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...Q1 Answer: For the economic rationale, first, the attraction of Orange was its spectacular growth of CAGR of 115% over 1994-1998, the fastest growth rate among all UK operators and the third largest wireless operator in UK. Thus from the acquisition, Mannesmann could achieve high inorganic growth in UK markets, which suits Mannesmann’s business strategy to become a leading telecommunication company focused on European market. Second, Orange adopts aggressive market mobile services strategy, as it recently announced plans for developing a single global internet platform. Mobile segment had experienced a very high growth (CAGR of 52% from 1990 -1999) and data traffic on mobile networks was less than 2% in 1999 but forecast to increase to 45% by 2003. DoCoMo in Japan had launched mobile internet service “i-mode” and its ARPU increased 25%. Mannesmann could assume the same 25% ARPU enhancement upon the launch of Orange’s similar mobile service internet platform. We believe Mannesmann underpay for acquiring Orange. Although referring to past mobile transaction table, which assumes control premium - Exhibit 8, Mannesmann was relatively paid more as EV/Sub is 8,857x and EV/POP is 533x, which are higher than means for controlling deals, which are 6,530x for EV/sub and 330x for EV/POP in Europe and 4,569x and 203x respectively in U.S. However, transaction in same industry doesn’t necessarily reflect firm-specific characteristics, thus we developed a proximate synergy valuation...
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...Iphone Marketin MIX When it comes to Apple Corporation, I always expect something new, something sensational, something transformational. They made Mac that realized Graphic User Interface before Microsoft’s Windows and actually enabled us to call personal computer from just computer. They made the iPod which not only boost sales and shares of Apple and saved from the crisis but also put Steve Jobs at the center of attention. Facing 35% shares down and softened consumption that probably caused by sub prime mortgage, Can iPhone be killer product for Apple? I am going to approach iPhone’s marketing plan from the business perspective. PRODUCT ”The iPhone is like the Mac for mobile.” says Jakob Nielsen. Indeed, iPhone’s major appeal might be the function as a tiny Mac computer. iPhone has capability to operate a various software and it has touch screen only interface. People can have videoconference and get the latest information as they wish through the iPhone. PRICE Researching ebay, I found that iPhone 8GB is being sold with around $430. Even though Apple built the premium image and has a number of loyal customers, considering current softened consumption and competition model, Blackberry, the price $430 seems to be way too expensive. I think $370 is proper price point. PLACE You can get iPhone in the AT&T or Apple store. However, I couldn’t find iPhone in Walmart and BestBuy’s web page. They sell iPhone’s accessory but iPhone. However, I don’t think that the limited...
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...Mobile Handset Subsidies Strategy Implementation Team 6 Bibin Bopan E011 Shirshendu Dutta E015 Suman Ghosh E019 Srihari Rao Kasaraneni E028 Satchit Sawant E045 Utsav Shah E045 Shubham Shukla E049 Contents Mobile Handset Subsidies 1 Part1 2 Introduction on handset subsidies and their purposes 2 Part 2 4 Different subsidy models used across different economies and firms 4 (Except India/Indian) 4 Part 3 6 Subsidies and Implementable Models for India 6 Part 5 9 Government Regulations on Mobile Handsets 9 Part1 Introduction on handset subsidies and their purposes Handset Subsidy as defined by Technology Glossary is: Handset Subsidy: Frequently, a wireless company will sell a phone (handset) below cost, with the hope of making up the loss later on customer usage fees. The amount of loss per handset is called the handset subsidy. Purpose behind lowering upfront payment for mobile handset devices: A lot of purposes could be attributed to models that lower upfront payments for handsets in return for longer term service contracts designed to recover fees in One to Three years. a. Upfront costs for new mobile handsets or tablets could be a barrier for people who are otherwise willing to pay in instalments. b. Ability to lock in customers or retain old ones or to attract them from other operators by giving them better handsets by more valuable contracts. c. Leveraging the capabilities...
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...Large Business User Panel - Mobiles Questionnaire To feed into the Oftel review of prices of calls to mobiles, we would be grateful if you could spare the time to complete the questionnaire below. Panel members are assured that any information they give will be treated confidentially and will not be attributed to themselves or their company. Once you have completed the form, please return it, by 8 January 2001 at the latest, to Melanie Smith, Oftel, 50 Ludgate Hill, London EC4M 7JJ (fax 020 7634 8757; e-mail: melanie.smith@oftel.gov.uk). In the meantime, please get in touch if you have any queries (020 7634 8741). Thank you for your help. 1. Are all your company’s phones on the same network (BT Cellnet/Vodafone/Orange/ One2one, Dolphin)? please tick relevant box Yes go to question 2 No go to question 1b 1b. How many mobile networks does your company use? please tick relevant box Two networks go to question 2 Three networks go to question 2 Four networks go to question 2 Five networks go to question 2 2. Approximately what proportion of your company’s fixed telecoms bill is made up of calls to its own mobiles? please tick relevant box 0-10% 51-75% 11-20% 76%+ 21-50% Don’t know all go to question 3 [pic] 3. How important were the following factors when your company chose all of the mobile network/s it currently uses? Please tick one box across the row for each factor | |Very...
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...Estimating Switching Costs in the Mobile Telecommunications Industry in the UK∗ Lukasz Grzybowski Center for Information and Network Economics Munich Graduate School of Economics September 2004 Preliminary version, Comments are welcome Abstract In this paper I estimate the magnitude of switching costs in the UK mobile industry. Using a survey data with individual choices of network operators in two consecutive years I find a presence of very strong average switching costs, which make the majority of consumers reluctant to switch networks. The size of average switching costs differs significantly across networks and the observed switching may be due to heterogeneous switching costs across consumers. The willingness to switch networks depends to some extend on consumer’s characteristics. Keywords: mobile telephony, switching costs, discrete choice. JEL Classification: C25, D12, L96 ∗ I would like to thank Volkswagen Stiftung and Munich Graduate School of Economics for the generous financial support which made this research possible. All errors are mine. 1 1 Introduction The presence of switching costs has a critical impact on the consumers’ behavior and firms’ strategies in many industries. The anticompetitive effects of switching costs are of major concern for the regulators. Therefore, the identification and measurement of the magnitude of switching costs should provide important information for the regulators. In particular, the mobile telephony may be subject to...
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...com/8301-1035_3-57618080-94/price-war-cuts-roaming-fees-for-french-mobile-customers/?part=rss&subj=news&tag=2547-1_3-0-20 by Stephen Shankland January 30, 2014 9:46 AM PST Price war cuts roaming fees for French mobile customers Orange CEO Stephane Richard, shown here speaking at the LeWeb conference in 2013, has brought his company into a price war that's giving French mobile subscribers lower roaming rates elsewhere in Europe. Three French carriers -- Orange, Bouygues, and Iliad's Free Mobile -- have begun competing for customers by cutting the roaming fees that can spook travelers and tourists from using mobile phones when abroad. The price war is good news for people in Europe, where a fragmented mobile-network market means it's common to worry about the extra costs for making calls and downloading data while traveling outside one's home country. But it's likely the carriers aren't just motivated by the urge to woo customers: they're also likely angling for a better bargaining position for talks about proposed European legislation that would scrap roaming fees completely. Neelie Kroes, the European Commission vice president overseeing the region's digital agenda, has been strongly pushing for a unified telecommunications market that would make it easier for carriers to span multiple countries and for individual customers to cross borders. One tenet of proposed legislation is an end to roaming fees by 2016. Kroes wants Europe to reclaim mobile-network leader leadership it's lost...
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...company, Vodafone Airtouch, illustrates how crucial it is to see service offers in terms of the benefits they bring to customers. The company was aware of extensive research which had found high levels of confusion among purchasers of mobile phones, with a seemingly infinite permutation of features and prices. With four main networks to choose from, dozens of tariffs and hundreds of handsets, it easy to see why buyers sought means of simplifying their buying process. Throughout the 1990s, Vodafone had positioned its UK network as superior technically to its competitors. Advertising focused on high coverage rates and call reliability. Vodafone was the UK's most popular mobile phone operator, with almost eight million customers, including 4.2 million Pay as you Talk customers. It had opened the UK's first cellular network on 1 January 1985and was the market leader since 1986. Vodafone's networks in the UK - analogue and digital - between them carried over 100 million calls each week. It took Vodafone more than 13 years to connect its first three million subscribers but only 12 months to connect the next three million. Vodafone had the largest share of the UK cellular market with 33% and had more international roaming agreements than any other UK mobile operator. It could offer its subscribers roaming with 220 networks in 104 countries. Despite all of the above, Vodafone was aware that although it was recognised as an extremely strong business in the corporate marketplace, it was...
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...Essay 3) Use an extended example to discuss how ‘the sector matrix’ framework is useful for analysing demand and supply linkages in an industry. The end of the 20th century has experienced rapid changes in the way of trading, due to the expansion of capitalism. The Oxford dictionary defines capitalism as “an economic and political system in which a country’s trade and industry are controlled by private owners for profit, rather than by the state”. Due to high competition, firms have desperately been trying to reduce costs of production in order to maximise profits. Published in “Competitive Advantage” in 1985, Porter’s value chain is a great example to show how much importance firms gave to the supply side of the market in this period. Porter described the value chain as “a set of products and services linked together in a sequence of value adding economic activities”. In other words, it analyses the stages in which a product is created from raw material until it’s finished, each stage adding value to the product. Gereffi’s ‘Global Commodity chains’ uses the old strategy chains and links them with their political and geographical context, adding a spatial and territorial dimension to the demand and supply in a market.________________________________________ In 1998 in their article “Breaking the Chains? A sector Matrix for Motoring”, Julie Froud, Colin Haslam, Sukhdev Johal and Karel Williams tackled the settled chain concepts by showing its limits regarding complex industries...
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...Large Business User Panel - Mobiles Questionnaire To feed into the Oftel review of prices of calls to mobiles, we would be grateful if you could spare the time to complete the questionnaire below. Panel members are assured that any information they give will be treated confidentially and will not be attributed to themselves or their company. Once you have completed the form, please return it, by 8 January 2001 at the latest, to Melanie Smith, Oftel, 50 Ludgate Hill, London EC4M 7JJ (fax 020 7634 8757; e-mail: melanie.smith@oftel.gov.uk). In the meantime, please get in touch if you have any queries (020 7634 8741). Thank you for your help. 1. Are all your company’s phones on the same network (BT Cellnet/Vodafone/Orange/ One2one, Dolphin)? please tick relevant box Yes go to question 2 No go to question 1b 1b. How many mobile networks does your company use? please tick relevant box Two networks go to question 2 Three networks go to question 2 Four networks go to question 2 Five networks go to question 2 2. Approximately what proportion of your company’s fixed telecoms bill is made up of calls to its own mobiles? please tick relevant box 0-10% 51-75% 11-20% 76%+ 21-50% Don’t know all go to question 3 [pic] 3. How important were the following factors when your company chose all of the mobile network/s it currently uses? Please tick one box across the row for each factor | ...
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...Compaq, which will sell product under Compaq’s brand names. HTC operated two distinct segments- ODM business and its mobile operator business. Wanting to build a direct relationship with the customer, HTC invented in a complimentary business. Yet creating a brand bore significant risks. Own brand sales means HTC would now directly take on inventory, marketing and support as well as warranty risks. HTC also started selling products in China. The closed nature of the U.S. market posed more challenges for HTC. Its success in the U.S. would depend on the operators’ willingness to subsidize its products and offer co-marketing support. Introductrion: HTC had generated a buzz for revealing two new handsets, as well as surprising the world with the announcement of HTC magic, the second phone that ran on Google’s new mobile platform, Android. Indeed, HTC was gaining more respect as a leading manufacturer of mobile phones. Twelve years ago, the company started out as a relatively obscure Taiwanese firm that made personal digital assistants (PDAs) for other companies. HTC then transitioned into the fast-growing smartphone category-high-end mobile phones that could do everything from e-mail to internet surfing to playing digital video. Dedication to innovation and preserverance had helped make HTC the worlds leading manufacturer of smartphones that ran Microsoft’s Window Mobile operating system. Historically, HTC had...
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...in the UK market Roger A. Strang We will be the communications leader in an increasingly connected world. Vodafone website, 2009 In 2009, Vodafone, the world’s largest mobile telephone operator by revenue, was under increasing pressure to develop a strategy to ensure leadership in the rapidly growing market for high-speed internet services in its UK home market. The challenge for the company was that the development of new technologies for voice, data and video transmission was blurring the boundaries among traditional industries and forcing reconsideration of what was required for a strategy of ‘total communications. This growth in demand for new services had attracted the interest not only of Vodafone’s traditional competitors in the telephone industry, but also from other communications companies such as Virgin Media ((the largest cable operator in the UK) and Sky Broadcasting which was the UK’s largest provider of satellite-based television. Other new competitors included the largest UK retailer of mobile phones and services, Carphone Warehouse and suppliers such as Apple (iTunes) and Nokia (Ovi) which had been investing heavily in digital content. Google was also increasingly involved in the communications field with a new, open, mobile operating system, Android and investments in mobile search and advertising. In addition to changes in competition, Vodafone and other operators faced rapid changes in technology with the growth of IP (internet protocol allowing...
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