Europa Vs. Índia Strategic Changes in the Teleco
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Universidade de Aveiro Departamento de Economia,Gestão e Engenharia 2012 Industrial SASMITA MUDANÇAS ESTRATÉGICA NO SECTOR DAS MOHANTY TELECOMUNICAÇÕES: EUROPA VS. ÍNDIA STRATEGIC CHANGES IN THE TELECOMMUNICATIONS SECTOR: EUROPE VS. INDIA Universidade de Aveiro Departamento de Economia,Gestão e Engenharia 2012 Industrial SASMITA MUDANÇAS ESTRATÉGICA NO SECTOR DAS MOHANTY TELECOMUNICAÇÕES: EUROPA VS. ÍNDIA STRATEGIC CHANGES IN THE TELECOMMUNICATIONS SECTOR: EUROPE VS. INDIA Dissertação apresentada à Universidade de Aveiro para cumprimento dos requisitos necessários à obtenção do grau de Mestre em Gestão, realizada sob a orientação científica do Doutor António Carrizo Moreira, Professor Auxiliar do Departamento de Economia,Gestão e Engenharia Industrial da Universidade de Aveiro Este trabalho é dedicado à minha família e sogros. o júri presidente Profa. Doutora Maria Madalena Gomes Vilas Boas Professora Auxiliar Convidada, Departamento de Economia,Gestão e Engenharia Industrial, Universidade de Aveiro Prof. Doutor Daniel Ferreira Polonia Professor Auxiliar Convidado, Departamento de Economia,Gestão e Engenharia Industrial, Universidade de Aveiro Prof. Doutor António Carrizo Moreira Professor Auxiliar, Departamento de Economia,Gestão e Engenharia Industrial, Universidade de Aveiro agradecimentos Este trabalho foi feito com ajuda valiosa e sugestões de vários amigos, colegas e professores. Um agradecimento especial a minha tese de conselheiro António Carrizo Moreira Prof por sua orientação e valiosas sugestões. Agradeço também a meus familiares pelo seu amor e apoio. Especialmente, ao meu marido que me ajudou em vários aspectos. palavras-chave Gestão de Telecomunicações, a estratégia de estratégia, em telecomunicações, mudanças estratégicas em telecom, telecomunicações na Europa, as mudanças estratégicas no setor de telecomunicações na Europa, indiano de telecomunicações, as mudanças estratégicas no setor de telecomunicações indiano. resumo Neste trabalho, as mudanças estratégicas no setor de telecomunicações da Europa são estudados. Dez maiores empresas da Europa são selecionados para esta análise. Suas mudanças estratégicas sobre a década 2001 - 2011 são estudadas e analisadas. Essas mudanças estratégicas do mercado Telecom Europeia são posteriormente comparados com o seu homólogo indiano. Estes dois mercados são, então, analisada a partir dos pontos de vista de mudanças estratégicas. Finalmente, as semelhanças e diferenças entre os dois mercados são analisados e comparados. keywords Telecommunication management, strategy, strategy in telecom, strategic changes in telecom, telecom in Europe, strategic changes in telecom sector in Europe, Indian telecom, strategic changes in Indian telecom sector abstract In this work, the strategic changes in the telecom sector of Europe are studied. Ten largest companies of Europe are selected for this analysis. Their strategic changes over the 2001 – 2011 decade are studied and analyzed. These strategic changes of European Telecom market are subsequently compared with its Indian counterpart. These two markets are then analyzed from the view points of strategic changes. Finally, the similarities and differences between the two markets are analyzed and compared. Contents List of abbreviations ……………………………………………………………………………………… iv List of figures ……………………………………………………………………………………………... vi List of tables ………………………………………………………………………………………………. vii Chapter Title Page Introduction ……………………………………………………………………………. 1 Objectives ………………………………………………………………………………………… 2 Methodology ……………………………………………………………………………………... 2 Previous Works …………………………………………………………………………………... 2 1 Overview of Telecom Market (Literature Review) …………………………………. 5 1.1 A Brief History of Telecommunication Industry ………………………………………………… 5 1.2 Basic Telecom Statistics ………………………………………………………………………….. 6 1.3 Key Indicators of Europe and the Rest of the World …………………………………………….. 10 1.4 Telecommunication Market Shares ………………………………………………………………. 11 1.5 Bandwidth Demand per User in the Internet ……………………………………………………... 13 1.6 Top Broadband Economies of the World ………………………………………………………… 14 1.7 The Reasons behind the Strategic Shifts …………………………………………………………. 16 1.7.1 Market Penetration and Growth Rate …………………………………………………………….. 16 1.7.2. Mobile Cellular Market …………………………………………………………………………….. 16 1.7.3 Fixed Broadband Market …………………………………………………………………………… 17 1.7.4 Mobile Broadband Market …………………………………………………………………………. 17 1.7.5 Internet Users Market ……………………………………………………………………………….. 18 2 Factors and Indicators of Strategic Changes of Big Companies of Europe ………... 19 2.1 Analysis of Big Companies of Europe …………………………………………………………… 19 2.2 Fluctuation of Revenues ………………………………………………………………………….. 21 2.3 Technological Factors ……………………………………………………………………………. 23 2.4 Competition and Globalization Factors …………………………………………………………... 23 2.5 Market Dynamics ………………………………………………………………………………… 24 2.6 Social Factors …………………………………………………………………………………….. 24 3 Changes in Internal and External Strategies of European Telecom Companies ….. 25 3.1 External Strategic Changes in the main European companies …………………………………… 25 3.1.1 Strategic Changes due to Demographic Segment ………………………………………………. 26 3.1.2 Strategic Changes due to the Economic Segment ……………………………………………….. 26 3.1.3 Strategic Changes due to the Political Segment …………………………………………………. 26 3.1.4 Strategic Changes due to the Sociocultural Segment …………………………………………… 26 3.1.5 Strategic Changes due to the Technological Segment ………………………………………….. 27 3.2 Strategic Focus of the Companies towards Competitors …………………………………………. 27 3.2.1 Strategic Changes due to threat of new Entrant …………………………………………………. 27 3.2.2 Strategic Changes due to Bargaining power of Suppliers ……………………………………… 27 3.2.3 Strategic Changes due to Bargaining Power of Buyers ………………………………………… 28 i 3.2.4 Strategic Changes due to Threat of Substitute of Products …………………………………….. 28 3.2.5 Strategic Changes due to Intensity of Rivalry among the Competitors ………………………. 28 3.3 Internal Strategic Changes in the main European companies ……………………………………. 28 3.4 Managing Changes ……………………………………………………………………………….. 30 3.4.1 Change in Focus due to Competition: Wireless companies looking towards landline ……... 30 3.4.2 Outsourcing of Services to cheaper destinations ………………………………………………… 31 4 Changes in the Business Level Strategies and Strategic Actions …………………… 33 4.1 Changes in Business Level Strategies ……………………………………………………………. 33 4.2 Competitor in one country and Alliance Partners in another country ……………………………. 33 4.2.1 Rivalry through Alliance ……………………………………………………………………………. 34 I. Case of Orange and T-mobile alliance in the UK ……………………………………... 34 II. Case of Vodafone and Airtel in India …………………………………………………… 35 4.3 Internationalization of European Companies …………………………………………………….. 35 4.4 Other cases of Mergers, Acquisitions and Takeovers ……………………………………………. 36 4.5 New Trends due to advanced technologies ………………………………………………………. 37 4.6 Reversal of Strategies …………………………………………………………………………….. 38 4.7 Strategic Changes in Leadership …………………………………………………………………. 39 4.8 Strategic Changes in Entrepreneurship …………………………………………………………... 39 4.9 Changes in Marketing Strategies …………………………………………………………………. 40 4.10 Cultural Diversities and other Management Strategies ………………………………………....... 40 5 Company-wise Strategic Changes of European Players in the Last Decade ………. 43 5.1 Strategic Changes of Vodafone …………………………………………………………………... 43 5.2 Strategic Changes of Deutsche Telecom …………………………………………………………. 43 5.3 Strategic Changes of France Telecom ……………………………………………………………. 44 5.4 Strategic Changes of Telefónica…………………………………………………………………... 45 5.5 Strategic Changes of TIM………………………………………………………………………… 46 5.6 Strategic Changes of BT ………………………………………………………………………….. 46 5.7 Strategic Changes of Telia Sonera………………………………………………………………... 47 5.8 Strategic Changes of Telenor …………………………………………………………………….. 47 5.9 Strategic Changes of MTS ……………………………………………………………………….. 48 5.10 Strategic Changes of PT ………………………………………………………………………….. 48 6 Telecom Scenario of India in the 2001 to 2011 Period ………………………………. 51 6.1 Overview of Indian Telecom Market …………………………………………………………….. 51 6.2 Top 10 telecom players of India ………………………………………………………………….. 54 6.3 Changes in Strategic Moves ……………………………………………………………………… 56 6.3.1 Arrival of International Companies ……………………………………………………………… 56 6.3.2 Alliances between Companies …………………………………………………………………….. 56 6.3.3 Mergings and mega-mergings ……………………………………………………………………... 56 6.3.4 Joint Ventures with Telecom Vendors …………………………………………………………….. 56 6.3.5 Changes in Advertising and Branding ……………………………………………………………. 57 6.3.6 Looking for Fixed Network and Infrastructure Business ……………………………………….. 57 6.3.7 Introduction of VAS and new Services ……………………………………………………………. 57 ii 6.3.8 Expanding Services in other Related and Unrelated Sectors …………………………………. 57 6.3.9 New Services Adaptable with VoIP ………………………………………………………………. 57 6.3.10 New Ventures with Companies like Google ……………………………………………………. 58 7 Comparison between the European and Indian Industries …………………………. 59 7.1 The Figures ……………………………………………………………………………………….. 59 7.2 Similarities ……………………………………………………………………………………….. 59 7.3 Differences ……………………………………………………………………………………….. 59 7.4 Strategic Differences between the two Markets ………………………………………………….. 61 Conclusions …………………………………………………………………………….. 63 References ……………………………………………………………………………… 65 iii List of Abbreviations 3 : 3G and other advanced service provider of Hutchinson Whampoa 2G : 2nd Generation of Mobile Communications 2.5G : The Intermediate