8. CSL Limited
Headquarters Hong Kong
Industry Telecom
Founded 1983
Parent Company Telstra Corporation Limited Australia’s leading
telecommunications and information services company
Status The leading mobile operator in Hong Kong.
Introduction
─
8
10. Key Facts
It is Hong Kong's first mobile network operator.
It was the first in the world to begin a High Speed Switched Data
Service or HSCSD.
It was the first in Hong Kong to launch a commercial General
Packet Radio Service or GPRS, and launched Asia‘s first.
Introduction
10
11. Business
Retail
Around 40 retail shops under three different brands.
Corporate
Provide total mobile solutions to corporate customers and industries.
Wholesales & International Services
Prepaid cards & third-party operators, IDD;
No. 1 roaming coverage in Hong Kong with most overseas’ partners.
Technology
Customer Relationship Management
Introduction
11
13. Sales of mobile communication equipment and devices
Basic communication charges (pre-paid, post-paid)
Value-added service charges
Revenue Model
13
14. Revenue Model
Cloud Service
Anyplex
Library of Hollywood blockbuster movies on demand
GameBox
Cloud-based mobile gaming service
Books On Demand
Online book store service
MyRoom
Personal cloud storage and content sync service
Entertainment
Music
Musicholic
Playliz
Music Channel
Connecting Tone
MyRingtone
Invest Family
Invest Power
Invest Pro
Invest Express
Contents Channels
Information Channel
Studio On Demand
Mobile entertainment with live
and archived TV programs
Others
Disney Channel
LUXE Traveler app
Non-traditional Voice & SMS Management
Call Manger app
Call Filtering
Multi number
Multi SIM
SMS forward
Secretarial Service
Customer Care
Service App
Personalized Self-served channel to
manage customer account
oneRewards
Mobile coupon App for one2free
customers with various benefits
Others
Content Billing
Short code service for
3rd party content billing
14
23. Operation-Content Management
How to realize cooperation? e.g. Game Box
Game publishers invent games and gain licenses
CSL negotiates with game publishers
CSL and Game publishers sign contract for their
cooperation
CSL includes the games into the GameBox and do
promotion
CSL shares a certain part of their revenues with game
publishers
23
24. Mobile Device
receives streaming video
and sends commands
Cloud-gaming Server
does all the heavy work
Low Latency Video
Controller Action
powered by one2free’s 4G LTE network
Operation-Cloud VS GameBox
How does GameBox work?
24
26. Cooperated products (e.g. GameBox)
Contents are produced by other game publishers (Capcom/Atari)
Technical support is provided by CSL
IP is owned by both CSL and game publishers
Intellectual Property
Technical
Support Contents
IP
26
27. Products invented completely by others (e.g. Movie, music)
CSL only provide a platform and help to do promotion and marketing.
IP (including concept, content, etc. ) belongs to that party.
Intellectual Property
Platform Content & IP
27
31. Ecology-competitors
Credit Suisse Telecommunication Network Ratings
Telecommunications
Operator
3G
Coverage
Score
3G
Speed
Score
4G
Speed
Score
4G
Speed
Score
Common
Usage
Score
Continuous
Performance
Total
Score
SmarTone 4 5 5 4 4 5 27
Hutchison Telecom 5 5 3 5 3 4 25
CSL* 5 3 3 4 2 4 21
China Mobile HK 3 2 4 3 4 5 21
PCCW 3 4 3 3 2 3 18
Notes: General usage includes browsing websites and uploading images, with 5 points being the
highest score for the item. Final scores are rounded up in the test.
*Credit Suisse tested CSL’s one2free network
31
32. Ecology-competitors
CSL
Hutchison Telecom
SmarTone
PCCW
Hong Kong Telecommunications Operators Market Share
Based on the number of users
29.7%
12.9%
13.6%
25.8%
Note: Based on statistics from last year-end.
Credit Suisse estimated the number of users and profits made from services
32
38. Rivalry among
Existing
Competitions
Threat of New
Entrants
Threat of
Substitute
Products or
Service
Bargaining Power
of Suppliers
Bargaining Power
of Buyers
Five Forces Framework
38
39. Rivalry among
Existing
Competitions
Threat of New
Entrants
Threat of
Substitute
Products or
Service
Bargaining Power
of Suppliers
Bargaining Power
of Buyers
Five Forces Framework
39
40. 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 …… 2020
3G
3.5G 3.75G
4G LTE
LTE CAT 4
LTE ADVANCED
5G
100MB 300MB150MB
Price War, Service War, Quality War, New Product War
Rivalry among Existing Competitors
40
41. 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 …… 2020
3G
3.5G 3.75G
4G LTE
LTE CAT 4
LTE ADVANCED
5G
100MB 300MB150MB
Rivalry among Existing Competitors
Service War
Canceling the
“plan of limitless
data use”
41
42. 42
2011.11
2012.2
2013.9
Office of the Telecommunications Authority “guidance for fair data use”
CSL, 3HK “fair data usage” 5G
SmarTone cancel “limitless data use” “fair data usage” 5G & 8G
PCCW cancel “limitless data use” ONLY!
CSL,3HK, SmarTone cancel “limitless data use”
China Mobile “limitless data use”
Rivalry among Existing Competitors
Service War-Cancel the plan of limitless data use
43. 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 …… 2020
3G
3.5G 3.75G
4G LTE
LTE CAT 4
LTE ADVANCED
5G
100MB 300MB150MB
Rivalry among Existing Competitors
Quality War
Comparison between
1800MHz and
2600 MHz
43
44. 44
2012.8 SmarTone change 1800MHz from 2G to 4G
better for indoor signal
CSL dual-band: 1800MHz and 2600MHz
more capacity, more stability
Rivalry among Existing Competitors
Quality War-Comparison between 1800MHz and 2600 MHz
45. 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 …… 2020
3G
3.5G 3.75G
4G LTE
LTE CAT 4
LTE ADVANCED
5G
100MB 300MB150MB
Rivalry among Existing Competitors
New Product War
CSL
vs.
Genius Brand
(PCCW+3)
45
46. 46
2013.3
2013.6
Genius Brand(PCCW + 3HK)
new 10MHz band width of 2600MHz total 20MHz!!!
CSL LTE Cat 4: download speed—150Mbps
necessary requirement: 20MHz bandwidth
PCCW LTE Cat 4
3HK LTE Cat 4
Rivalry among Existing Competitors
New Product War（LTE CAT 4）- CSL vs. Genius Brand (PCCW+3HK)
48. Rivalry among
Existing
Competitions
Threat of New
Entrants
Threat of
Substitute
Products or
Service
Bargaining Power
of Suppliers
Bargaining Power
of Buyers
Five Forces Framework
48
49. No 3G License
Rent 3G capacity from CSL & PCCW
Terrible user experience
Reauction 3G License in HK
The entrance of China Mobile HK
Threat of New Entrants
China Mobile Hong Kong
49
50. Plum Consulting:
“Increasing overall spectrum instead of redistributing existing holdings.”
Threat of New Entrants
Protests from Operators in HK
50
51. Rivalry among
Existing
Competitions
Threat of New
Entrants
Threat of
Substitute
Products or
Service
Bargaining Power
of Suppliers
Bargaining Power
of Buyers
Five Forces Framework
51
52. Threat of Substitute Products
Fixed Carriers
Pure Fixed Carriers
Not trendy
Wharf T&T, HK Broadband
Triple Players: PCCW
TV, Broadband, Mobile
FMC VS FMS
Convergence, Wifi
52
53. Threat of Substitute Products
OTT
Skype/Wechat:
Long-Distance Call, SMS
Other APPs:
Music, Pictures Download
Add into Industrial Chain
53
54. Rivalry among
Existing
Competitions
Threat of New
Entrants
Threat of
Substitute
Products or
Service
Bargaining Power
of Suppliers
Bargaining Power
of Buyers
Five Forces Framework
54
55. The bargaining power of suppliers
KEY POINTS GAME MOVIE/BOOK/MUSIC
Substitute products are unavailable in the marketplace. ☆☆☆ ☆
The supplier’s product is highly differentiated. ☆☆☆☆ ☆
There are few suppliers and many buyers. ☆☆☆ ☆☆
It is dominated by a small number of companies and is
more concentrated than the industry to which it sells.
☆☆☆ ☆☆
The cost of switching from one supplier’s product to
another supplier’s product is high.
☆☆☆ ☆☆
Its products are an important part of the buyer’s business. ☆☆☆ ☆☆☆
55
56. Rivalry among
Existing
Competitions
Threat of New
Entrants
Threat of
Substitute
Products or
Service
Bargaining Power
of Suppliers
Bargaining Power
of Buyers
Five Forces Framework
56
57. KEY POINTS BUYER
The telecommunication service is sufficiently standardized among
sellers that not only can buyers find alternative sellers but also they
can switch suppliers at virtually zero cost.
☆☆☆☆
The supplying industry is comprised of large numbers of relatively
small sellers.
☆☆☆☆
The buyers pose a threat of integrating backward to make the
industry’s product.
☆☆☆☆
The buyer’s purchases directly determine the revenue of the company. ☆☆☆☆
The bargaining power of buyers
57
58. As for now, CSL has the largest market share in HK.
However, due to the fierce competition of HK
telecommunication industry, CSL has to move really fast
and being creative enough. Otherwise, the future of CSL
cannot easily be as good as it is now.
Conclusion
58
