MOBILE PHONE INDUSTRY IN UK

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MOBILE PHONE INDUSTRY IN UK
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INTRODUCTION

• Began in mid 1980s
• 25 million subscibers
• 50 market penetration (Oftel)
• Economic benefits
• Increased quality of life?

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PEST ANALYSISPOLITICAL

• Mobile phone transmitter stations
• Government intervention to ensure competition
• 3G license selloff

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ECONOMIC

• Commitment to 3G
• Subsidised handsets on expected revenues
• Pay As You Go has lost money on some users
• Contract customers are 3 times more lucrative (FT
  source(!))
• Cost of building network infrastructure,
  maintenance and upgrading to 3G
• Income from callers dialling mobiles from
  landlines

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SOCIAL

• Estimated 2/3 of UK households run active mobile
  phones (Oftel)
• Creates many jobs in UK
• Text messages
• Social prerequisite
• Fashion accessory
• Cancer scares

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TECHNOLOGY

• Implications of WAP
• Phones get smaller with more features
• High bandwidth with potential for video

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5 FORCES ANALYSISThreat of new entrants

• Low because of infrastructure costs and broadcast
  license costs
• Large number of resellers but they are small and
  weak

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Buyers

• Small buyers give networks power
• Government watchdog keeps prices reasonable
• Competition between networks
• Tariffs not easily comparable

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Sellers

• Handsets
• Network equipment

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Substitutes

• No close substitutes
• Pagers not as effective
• Internet text messaging Genie.co.uk

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Competitive rivalry

• Hyper competitive market
• Mature market
• Regulation is essential
• 3G phones could create new sub-market