CS5261 Group 8 Presentation - US Mobile Industry 14 Nov 2007

1. 2007
Group 8
Oh Kwang Shin
Peng Yee Nar
Tong Nguyen Quynh Tram
Tran Nguyen Thuy Duong
Tran Quang Hien
Vu Tung Lam
US Mobile Service Industry

2. US Mobile Service
Industry
14 Nov 2007 2
AgendaAgenda
• Background
• SWOT Analysis
• Recommended Strategy
• Current Pricing Plan
• Unique Pricing Strategy
• Final Remark

3. US Mobile Service
Industry
14 Nov 2007 3
Background - USBackground - US
• Area
– 3.79 million square miles (9.83 million km²)
– Singapore: 271.8 square miles (704 km²)
• Population
– Over 300 million
– Singapore: 4.68 million
• Federal Constitutional Republic
– Comprising 50 states and a federal district
– Different rules in different states
• Largest national economy in the world

4. US Mobile Service
Industry
14 Nov 2007 4
Background –Background –
US Mobile IndustryUS Mobile Industry
• Many mobile operators
– Nation-wide: cover >80% population area
• AT&T Inc., Verizon, Sprint Nextel and T-Mobile
– Region-wide: within several regions
– Mobile Virtual Network Operators (MVNO)
• Do not own or operate a wireless network
• Resell wireless service under their brand name
• Heterogeneous technologies
– 3rd
generation: UMTS, CDMA 1xRTT/EV-DO
– 2nd
generation: GSM, CDMA, TDMA, iDEN
– 1st
generation: analogue technology (AMPS)

5. US Mobile Service
Industry
14 Nov 2007 5
Background –Background –
Stock PriceStock Price
AT&T Inc.
Sprint Nextel

6. US Mobile Service
Industry
14 Nov 2007 6
Strengths
SWOT AnalysisSWOT Analysis
of AT&T Inc.of AT&T Inc.
Helpful
to achieving the objective
Harmful
to achieving the objective
International coverage
Enterprise experience
Strong market strategy
Innovative products
High churn rate
Poor customer satisfaction
Cash flow problem
Acquisition plan
Sales of iPhones
iPhone security hack
Threat from competitor
Non-telecom industry
(Google Inc.)
Saturated market
Internalorigin
attributesofthe
organization
Exter
attrib
environ
S
O T
W

7. US Mobile Service
Industry
14 Nov 2007 7
Recommended StrategyRecommended Strategy
for AT&T Inc.for AT&T Inc.
• Continue strong market strategies
and innovative products to attract
customers
• Focus on young customer to achieve
higher growth of subscriber
• Customer loyalty program
• WiMAX – emerging technology

8. US Mobile Service
Industry
14 Nov 2007 8
AT&T Pricing PlanAT&T Pricing Plan
-- IndividualIndividual

9. US Mobile Service
Industry
14 Nov 2007 9
AT&T Pricing PlanAT&T Pricing Plan
-- FamilyTalkFamilyTalk

10. US Mobile Service
Industry
14 Nov 2007 10
Pricing StrategyPricing Strategy
- AT&T Inc.- AT&T Inc.
• Grouping targeted users
– Individual users
– Business users
– Family users
• Versioning in monthly minutes
– 500 ~ 6000 minutes nation plans
• Bundling in FamilyTalk plans
– First two lines for one low price
– Each additional line for US$9.99/mth

11. US Mobile Service
Industry
14 Nov 2007 11
Unique PromotionalUnique Promotional
Strategy - AT&T Inc.Strategy - AT&T Inc.
• Exclusive deal with AT&T and Apple
– Grab iPhone with any two-year contract
• Apple iPhone
– US$399 requiring 2-year plan
– 1.1 million subscribers
– Roughly 40 percent of those subscribers
were new AT&T customers

12. US Mobile Service
Industry
14 Nov 2007 12
Final RemarkFinal Remark
• Decrease of mobile phone subscribers
growth rate
• Strong competition
– 75% market share: AT&T Inc., Verizon Wireless
and Sprint Nextel
• Heterogeneous technologies
– AT&T Inc.: GSM
– Verizon Wireless and Sprint Nextel: CDMA with
3G (1xRTT and EV-DO)
– T-Mobile: W-CDMA
– Sprint Nextel: WiMAX-based 4G platform