Airtel Pest Analysis and Porters Five Forces

Airtel Pest Analysis and Porters Five Forces AIRTEL PEST Analysis Political The ministry of telecom industry hiked FDI limits from 49% to 74% which enabled Indian promoters of telecom sector to spark off the competition and consolidation by selling their stakes to foreign entities. Airtel already have tie up with foreign partner SINTEL which is going to help in investing more in infrastructure and latest technology to provide the best services to their subscribers. Also due to this increase in foreign direct investment in telecommunication market, Airtel will be able to modulate the foreign stakes in their companies that have already acquired a range between 67-69 percent of their assets. With the increase in globalisation and tremendous growth of Indian telecommunication sector, Airtel launched its mobile services in Srilanka in Jan 2009 and investing to expand its network with latest technology in next five years. Recently Airtel have also acquired Zain for Africa operations which is the second biggest overseas purchase by an Indian company. Economical In telecom budget 2008, raw material for the manufacture of specified electronic hardware items have been exempted from excise duty which lowers the network equipment costs to benefit major mobile services provider, so Airtel can expand their network coverage to more rural areas at much cheaper cost. During the recession period Government policy to reduce the custom duty on convergence product from 10% to 5% helped in establishing parity devices used in communication sector, so this will help Airtel in lowering their cost for DTH expansion. Government has announced per second billing tariff for the subscriber along with the per minute billing plan. Though the per second plan is not beneficial for the telecom operators as this could reduce the sectors annual revenue by 10-15%.Operators are already struggling with the low Average Revenue Per user (ARPUs) due to high taxes (30 % of the gross revenue earned by the operators goes as various taxes) levied by government will now struggle more with this new plan. To overcome this situation Airtel has launched low tariff per minute plans along with per second plan. As majority of the subscribers make longer duration calls and the per second call could be detrimental for them with the new reduced per minute plan. Airtel could also launch pay per character for SMS services to increase the VAS revenue. Social Government has hiked FDI limits which would lead to better infrastructure in telecom due to intake of more investment by the foreign investors. As 70% of Indian population still resides in rural areas, improvement in telecommunication infrastructure and services will reduce isolation, increase business viability, farming productivity and access to educational and medical services. Airtel has already announced to set up 100000 service centres and telecom infrastructure in rural India by march 2010. Rollout of national rural employment scheme to all 596 districts in India with a provision of Rs.160 billion, to aid faster penetration of mobiles and consequently faster growth of Airtel as they hold major Indian telecom market with 24% growth at the end of 31st March 2009. Government has announced the auction for 3G and BWA spectrum and Airtel is one of the qualified bidders for the same and Airtel has already signed a deal with Ericsson to upgrade their network for 3G. It will help Airtel to undertake social initiatives of the government such as e-education, tele medicine, and e-health and e- governance, providing affordable broadband and mobile services to sub urban and rural areas.   As demand for the value added services and high speed broadband is increasing among the youth. Airtel being the leading private broad band service provider in the country has introduced the ultra fast speed of 50 Mbps for the broadband users on next generation VDSL2 technology which will allow users, the convenience to download a full feature film in less than 3 minutes. Along with it is providing free value add services like parallel ringing, website builder (Basic), PC secure (Anti-Virus software), online storage, unlimited gaming on games on demand. Increasing competition with the entry of many new operators in the telecom industry has forced in reduction of tariffs. So consumers get more options and can change their network operator according to their need. In this Airtel has introduced many low tariff plans like youth Plan for young people, ladies special, and friends prepaid plan, family celebration plan according to the requirements of the different customer segments. Segmentation strategy aims towards understanding the need gaps of specific consumer segments and creating special segmented products for them. Technological Increase in FDI limits also benefited inflow of latest technology with improved infrastructure, as AIRTEL is well established with better infrastructure so it can provide better services to its customers in urban and can expand its network in more rural areas. Introduction of Mobile Number Portability (MNP) which allows the consumer to retain their existing mobile number, even when they change the service provider. This will increase the competition among the service providers as the subscribers can change their network if they are not happy with the services of the existing service provider. Airtel has the edge over his competitors as their services are much better than other service providers.   Government has announced the auction for 3G and BWA spectrum which will allow telecom companies to offer additional valued services like high resolution video and multimedia services with high data rate transmission capabilities. Airtel has already qualified to bid for the auction. Also Airtel has signed a 1.3 billion deal with Ericsson to expand and upgrade its network for 3G services in 15 of Indias 22 telecom circles. Porters 5 Forces Analysis Threat from competition High Fixed Cost: The industry also suffers from high fixed cost which makes the entry barrier also very high for the industry. It comes as no surprise that in the capital-intensive telecom industry the biggest barrier to entry is access to finance. To cover high fixed costs, serious contenders typically require a lot of cash. When capital markets are generous, the threat of competitive entrants escalates. When financing opportunities are less readily available, the pace of entry slows. Meanwhile, ownership of a telecom license can represent a huge barrier to entry. There is already 6-7 players in each region excluding 3 -4 big players like Bharti Airtel, reliance, Vodafone and BSNL. Very less time to gain advantage by an innovation: Every company in this industrial sector in investing a huge amount in research and development and marketing strategy. That is why we see when any offer launched by any company is always counter attacked by other companies very soon. This makes the industry rivalry most prominent. E.g. Caller tunes, Life time cards. Price wars:  The price war is really very fierce in this industry. Price war in telecom industry has commoditized the market that branding has taken a backseat. New players are reducing their tariffs to get better hold in the market and in turn the existing big players like Airtel, reliance etc. also have to compete by introducing low tariff new plans such as youth plan for younger generation, ladies special etc. Threat of New Entrant Both potential and existing competitors influence average industry profitability. The threat of new entrants is usually based on the market entry barriers. They can take diverse forms and are used to prevent an influx of firms into an industry whenever profits, adjusted for the cost of capital, rise above zero. In contrast, entry barriers exist whenever it is difficult or not economically feasible for an outsider to replicate the incumbents position. The most common forms of entry barriers, except intrinsic physical or legal obstacles, are as follows: Economies of scale: In telecom industry the economies of scale exists from the supplier side. That is why companies try to increase their subscriber base at drastic rate. Distribution channels: Distribution channels are also providing a major determining factor. These channels are not loyal to any company and competitors can easily access them and make out work for them. Though huge licence fee to be paid upfront and high gestation period reduces the threat of new entrant and discourages investment and infrastructure in the telecom sector. Limited Spectrum availability, Regulatory issue which again leads to high licence fee also restrict new players from entering into the market. Rapidly changing technology and setup the efficient Infrastructure for the same accordingly is also the major factor which stops new player to enter into the telecom sector. New entrants are ready to enter huge capital considering the attractiveness of the market. Increase in FDI limits to 74% is bringing competition from foreign players. Huge investments are being made by the foreign companies to setup better infrastructure and getting latest technology into the country. Threat from the non telecom background brand which could foray into the telecom industry by the ease of outsoucing. Customer switching cost is very low, as cost of new connection is really low. And new connection offers more benefits to the customers Threat of substitute The threat that substitute products pose to an industrys profitability depends on the relative price-to-performance ratios of the different types of products or services to which customers can turn to satisfy the same basic need. The threat of substitution is also affected by switching costs that is, the costs in areas such as retraining, retooling and redesigning that are incurred when a customer switches to a different type of product or service. It also involves: The potential major substitutes for telecom industry are as follows: Products and services from non-traditional telecom industries pose serioussubstitution threats. Cable TV and satellite operators now compete for buyers. The cable guys, with their own direct lines into homes, offer broadband internet services, and satellite links can substitute for high-speed business networking needs. Wireless phones are also getting cheaper each year over the last decade; this has provided consumers with more convenience and mobility, to the extent that the younger demographic now considers a fixed line phone redundant. Just as worrying for telecom operators is the internet: VOIP i.e voice over ip telephony is becoming a viable vehicle for cut-rate voice calls. Delivered by ISPs not telecom operators internet telephony could take a big bite out of telecom companies core voice revenues. Applications like Skype have been extremely popular among younger generation users and are fast emerging as preferred means of communication. BUYERS POWER Buyer power is one of forces that influence the appropriation of the value created by an industry. The most important determinants of buyer power are the size and the concentration of customers. Other factors are the extent to which the buyers are informed and the concentration or differentiation of the competitors. Kippenberger (1998) states that it is often useful to distinguish potential buyer power from the buyers willingness or incentive to use that power, willingness that derives mainly from the â€Å"risk of failure† associated with a products use The following points influence the buyer power: Lack of differentiation among the service provider: As telephone and data services does not vary much regardless of which companies are selling them. Cut throat competition: Competition level has increased a lot with increase in new foreign as well as domestic players in the industry. Operators are engaging in an intense price war which is benefitting to the buyers in every way. Customer is price sensitive: Every operator is offering low tariffs with better services due to high level of competition among the operators which has made customer more sensitive to price. Low switching costs from one operator to other operator. The consumer now has access to several means of communication like email, instant messaging which are diminishing the importance voice services Attractive Schemes for new connections. Availability of all operators everywhere. SUPPLIER POWER Supplier power is a mirror image of the buyer power. As a result, the analysis of supplier power typically focuses first on the relative size and concentration of suppliers relative to industry participants and second on the degree of differentiation in the inputs supplied. The ability to charge customers different prices in line with differences in the value created for each of those buyers usually indicates that the market is characterized by high supplier power and at the same time by low buyer power. In the drawback of Indian telecom industry the following should be kept in mind: Large number of suppliers: The industry basically has a large number of suppliers, which helps them to choose from a lot of options. So they try to select the best option to deliver the value to the customers and to have a competitive advantage from their competitor. Shared tower infrastructure: Technology has helped them to share the tower infrastructure. This basically helps them to reduce the initial investment a lot. Limited pool of skilled managers and engineers especially those well versed in the latest technologies which put companies into weaker side in terms of hiring and salaries. Medium cost of switching since changing their hardware would lead to additional cost in modifying the architecture.

Health Care Conditions Essay

As we analyze the factors contributing to health care costs we must find a solution that provides high-quality care for an aging population. Improvements to modern medicine are prolonging life causing a schism between a health care system oriented towards acute care and the increasing chronic care needs of older adults. Studies do show that health care costs for older Americans account for one third of all national health care expenditures. This being said the average expenditure for health care services for adults 65 and over is nearly four times the cost of those under 65. More significant changes need to be considered given the financial crisis our health care system faces. Health care costs are not solely due to longevity; consider increased utilization, new medical technologies, general inflation, fraud, and waste and abuse. This paper will discuss one article to be used in my final presentation on health care for anaging population. Data collection procedures The study on chronic health conditions used a questionnaire presented to study participants by in-person and telephone interview using computer-assisted software. They also used the Statistics Canada Canadian Community Health Survey (CCHS) for age prevalence patterns and to show how chronic condition prevalence varies by age group. The use of the CCHS survey for historical data and comparisons is very appropriate for this study. The use of a questionnaire, while not ideal, is appropriate for the large number of participants. The survey sampled approximately 130,000 people aged 12 years or older. In-person interviews are the most reliable, but the downside to using telephone interviews using computer-assisted software is that participants may go through the questionnaire quickly or skip questions if they are unsure. Identity protection for research subjects Confidentiality is the protection of information that an individual has trusted you with and disclosed to you for a particular reason. Informed consent is a process in which the researcher explains to the participant what steps are taken to keep their information confidential and what would happen if there were a data breach. The participant then has the information needed to determine if this is adequate and whether or not to continue with the project. The article does not discuss the steps taken to  protect the identity of participants. There is no mention of patient record abstraction, personal information collected or informed consent. Reading the article, it is an assumption that the only information collected was the age and number and type of chronic conditions for each participant. Study reliability and validity The reliability of this study, that is, the consistency and repeatability of the measure is high. A question related to the number and type of chronic conditions experienced by each participant is reliable and is measuring one topic. The questionnaire meets face validity – it is a common-sense assessment and the question measures exactly what they want to study. Data analysis procedures To answer the research questions, the researchers used data from the CCHS survey to develop a baseline of the number of chronic conditions within certain age groups. That data was then projected for 25 years based on the target population which was derived from a model of the economic demographic system (MEDS) projection. The hypothesis, â€Å"The expectation is that, as the large baby boom cohort moves into older age categories, the overall proportion of the population with chronic conditions will increase† (Denton & Spencer, 2010), is best answered by projecting the number of people in each age group based on historical data and factoring in immigration, emigration, mortality, and fertility rates. I believe this study is quantitative. It involves randomly selected participants, uses face-to-face and phone questionnaires, the data analysis is statistical and is presented in tables and graphs, and is used to recommend a final course of action. The study design is descriptive, also called observational. Validity is important in descriptive studies; the lower the validity, the more study participants you will need. â€Å"For an accurate estimate of the relationship between variables, a descriptive study usually needs a sample of hundreds or even thousands of subjects.† (Hopkins, 2000) Conclusion In conclusion, the study shows that more than two-thirds of the population over the age of 12 has a chronic condition and 90% of them are over the age of 65. The researchers believe that as the participants move into higher  age groups the prevalence of chronic conditions will increase, which this study proves. The prevalence rate in 2005 is 68.7% and the prevalence rate in 2030 is 71.9% which is an increase of 3.2%. But how does this affect health care utilization and cost? With a modest reduction in the prevalence of chronic conditions, one-third of the projected increase in health care spending could be cut by 2030. In this study, a modest reduction is described as reducing the number of chronic conditions by one. Those with three chronic conditions would be reduced to two, two would be reduced to one, and one would be reduced to none. The strengths of this study are the high reliability and validity of the data recorded from the questionnaires. The data analysis and projections based on the target population, adjusted for emigration, immigration, mortality, and fertility was the best option for this type of study. The weaknesses of the study were the inability to abstract data on chronic conditions from the medical records of the participants, and the exclusion of participants in institutions which resulted in an under-estimation of chronic conditions in older populations. Another weakness noted by the researchers was that there was no record of the severity of the condition. This does not allow for accurate accounts of those cured of the chronic condition during the study period. References Denton, F.T., & Spencer, B.G. (2010). Chronic health conditions: Changing prevalence in an aging population and some implications for the delivery of health care services. Canadian Journal on Aging, 29(1), 11-21. Doi:http://dx/doi.org/10.1017/SO714980809990390 Hopkins, W.G. (2000). Quantitative Research Design. SportsScience, 4(1), retrieved online May 26, 2014 from http://www.sportsci.org/jour/0001/wghdesign.html

Ebay Inc Problems With Fraud - 1536 Words

Shelli M Dial BA 301-002 Homework Assignment #2 Ebay Inc Problems with Fraud EBay Inc Problems with Fraud Symptoms #1 Active Consumer PayPal acquires significant losses due to claims from consumers that merchants be inflicted with not performed or that their merchandise or services do not comply with the merchant s explanation, whether those requests occur from merchant counterfeit or from an accidental failure to achieve by the merchant. PayPal search for to salvage such claims from the merchant, although may perhaps not be capable to salvage in full stipulation the merchant is disinclined or incapable to reimburse. PayPal as well acquires losses from claims with the intention of the consumer did not authorize the transactions, from consumer fraud, from invalid transmissions and use of consumers who contain closed bank accounts or retain insufficient funds in them to fulfill payments( EBay 10K) . The Bill Me Later benefit is correspondingly subject to the danger of fraudulent activity connected with merchants, consumer of the Bill Me Later service and third parties conducting its consumer information. EBay’ s Payments establishment has taken actions to identify and decrease the hazard of fraud, except these actions require to be frequently enhanced and may perhaps not be successful in contradiction of latest and constantly developing structure of fraud or in association with original product contributions. If these procedures do not happen as expected, EBay industryShow MoreRelatedEbay Case Analysis1323 Words   |  6 PageseBay: Dominance in the On-line Industry eBay is The World’s Online Marketplace ®. Founded in 1995, eBay created a powerful platform for the sale of goods and services by a passionate community of individuals and businesses. 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