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PORTER

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  • 1. PORTERS 5 FORCE & 3 GENERIC STRATEGIES WITH RESPECT TO Presented by : Samuel David Mandal Amity Business School
  • 2. • Joint venture between Maxis Communication of Malaysia (74%) and Apollo Hospital Enterprise Ltd of India (26%) • Founded in1999 • Headquarters : Gurgaon • GSM Market share : 9.42% (sep 2010) • Revenue : Rs 4028 cr (approx ttm) • Revenue growth 9.36% QoQ Industry : 5.7% QoQ • Subscribers 4.65 crores • Present in 21 circles out of 23 telecom circles Presented by : Samuel David Mandal Amity Business School
  • 3. Presented by : Samuel David Mandal Amity Business School
  • 4. COMPETITIVE RIVALRY WITHIN INDUSTRY • With 13 players and 6-7 operators in a circle Indian market is overcrowded • Already India has the lowest call rates and still we have a Hard Price War. • High innovation leading to high costs Presented by : Samuel David Mandal Amity Business School
  • 5. THREAT OF NEW ENTRANTS LOW • Huge License Fees • Long gestation period LOW • Spectrum and regulatory issues • Entry of MVNOs and WiMax providers LOW • Infrastructure set up cost high • Rapidly changing technology Presented by : Samuel David Mandal Amity Business School
  • 6. BARGAINING POWER OF CUSTOMERS Price sensitive environment leading to lowering of call and data rates Low switching costs Implementation of Number Portability Lack of differentiation among service providers HIGH Presented by : Samuel David Mandal Amity Business School
  • 7. BARGAINING POWER OF SUPPLIERS AREA SUPPLIERS FEATURES Network Maintainance Nokia Siemens Lower operational cost Information Technology Hewlett-Packard Lower operational cost Passive Infrastructure BSNL Tower sharing, Higher revenue Call centre Aegis BPO, HindujaTMT Lower operational cost Presented by : Samuel David Mandal Amity Business School
  • 8. THREAT OF SUBSTITUTES LOW • Landline • CDMA HIGH • Video Conferencing • VoIP ENHANCER • E-mail • Social Networking Sites Presented by : Samuel David Mandal Amity Business School
  • 9. COST LEADERSHIP Offering lower call and data rates Low cost pricing strategy Lower operational cost * $ 400 million agreement with Datacomm * 10 year Passive tower sharing with BSNL * Billing, Data management outsoucing deal with Hewlett-Packard Presented by : Samuel David Mandal Amity Business School
  • 10. * Social Initiative Campaign *Stand out from a cluster of competitors *Instant brand recall *Ad Agency - Dentsu Targeting 3G Market for non- voice revenue Targetting Chennai and Tamil Nadu Pan India visibility through IPL DIFFERENTIATION Presented by : Samuel David Mandal Amity Business School
  • 11. Ooops....“Caught in the Middle” * Following different strategies together * Low cost but not best cost *Good differentiation strategy 140150160 169 148 150 145 144 89 18 29 23.99 15.02 14.71 9.42 8 Market Share Airtel Vodafone Idea BSNL Aircel Others Presented by : Samuel David Mandal Amity Business School
  • 12. Operator Customers Spending ARPU Spend Aircel 3,30,51,307 6449.46 92 1954 Airtel 9,02,58,820 12,295.46 162 1363 Idea 5,57,16,026 5768.59 139 1035 Analysis of Spending on 3G Licence in relation with competitors Presented by : Samuel David Mandal Amity Business School