Strategic Analysis of SingTel Telecom

Strategic digest of SingTel telecommunicationIntroductioncapital of Singapore telecommunication (Singapore telecommunications Limited, referred to as SingTel, AFP) was realized in 1879, is a wholly- leted by Singapore goernment-owned company, it is Singapores largest telecommunications companies.Singapore Telecom to increase soundly in commercializes come forwardside of Singapore, and a partial s posit in the operator, including the Australian carriers Optuss 100% stake in 2000, the British C qualified and Wireless Optus, and other shell outholders of the shargons.Singapore Telecom a majority stake is controlled by Temasek Holdings, the Chairman is lee(prenominal)Hsien Yang (the trice son of former Prime Minister Lee Kuan Yew and current Prime MinisterLee Hsien Loong, his younger brother).Products and ServicesSingTel is Asias leading telecommunications company, with across receiving set and Internet platforms for voice, data receiptss, service-oriented vexation, as intum esce as home two areas. Singapore Telecom has considerable been committed to providing guests with the Asia- peaceful regions most gamey- woodland service. Now the focus is on the Internet service deliverrs, roving phones and fixed telephone communications work above.Company HistoryOver the past decade, Singapore Telecom has successfully holy their high efficiency to the worlds leading operator changes. The company offers a wide range, the price is preferably competitive telecommunications services, and global 5000 companies from different countries to provide telecommunications services. Singapore Telecom has already built a large scale in Singapores domestic telecommunications network, and the annual investment of 1 billion impudently coins update the network. In nine to conjure up competitiveness at home and abroad, the company offers gifted fixed telecommunications services. At present, the company has been in the world, 15 countries, 23 cities and regions set up o perative organs, including China, the United States, Britain, Japan, Korea, Malaysia, Indonesia, Vietnam and Hong Kong and Taiwan. It has a glorious history of 120 years. SingTel marks to be a new era of pan-Pacific region bears the brunt of the true sense of the telecom operators. To this end, Singapore Telecom go out continue to expand with other Asian countries in telecom peers, and the scope of cooperation. SingTels Group CEO is Chua Sock Koong and CEO is Allen Lew.Business schemaSingapore Telecommunications Ltd. owns 7800 million as the users SingTel is Asia Pacific region, excluding China, the largest restless Internet operators. 1992 companies from the former government monopoly privatized, SingTel in 2003, when the postal service from its opening, the focus is forthwith on the Internet service providers, mobile phones and fixed telephone communications services above. Hopes by means of a comprehensive and sophisticated inter home(a) leading-edge technology, and gradual ly lounge about rid of the public color, precipitously turned into a full private sector. Goal is to build a world-class institutions, not only to win the international community for its recognition of knowledge and technology and technical expertise, and quality service and results provided by domestic users name in any case been positive.LogoNew corporate logo by a simple, exemplary of the ellipse, with the two squares. Designed to highlight the companys innovative technology, international affairs and services-oriented. Elliptical lines out of Singapore Telecoms global vision, the two squares on behalf of the acclivitous digital technologies, eyepatch the red and black of a stable and reliable dissemination of messages. The new visual corporate identity and prove Singapores telecommunications as a global application leaders pivotal position.From the above mentioned, we understand that SingTel Group is a leading company in the telecommunication industry in the region, d ue to successful business organization strategies. Thus, it is important that all organizations understand their strengths and weaknesses originally implementing strategies. They should first analyze their goals and operations to see if the current practices are working towards the com get byionary working and vision.A companys vision and mission is crucial to an organization, as it paves the way for where the company is headed and what it assumes to provide for its stakeholders. At the beginning of strategic management process, the organization ineluctably to develop its vision statement and mission statement. A vision statement is what the organization wants to deform and describe how the future get out look if the organization achieves its mission. A mission statement explains what the organization does, for whom and what the receipts is. The vision, mission statements and core cling tos of SingTel are shown in table 1 as followPrior to the development of scheme and ma rketplaceing plans, they should evaluate some(prenominal) the external and versed factors. Hence, the corporate world usually utilizes various strategic tools like the deck out Analysis that whitethorn influence the implementation of plans.Below is the SWOT Analysis of SingTelSingTel SWOT AnalysisSWOT analysis is the overall evaluation of a companys Strengths, Weaknesses, Opportunities, and Threats. The external analysis looks at opportunities and threats created by the environment while the internal analysis looks at the strengths and weaknesses of the company. In strategic planning, the company matches its capabilities with available opportunities and takes action to minimize threats. (Kotler, Bowen and Makens, 2006)SingTel Group is the leading integrated communications service providers in the Asia Pacific region and their core business operations are located in Singapore and Australia. The company has business in a number of sectors of the telecommunications market in the Asi a Pacific region (http//home.singtel.com/investor_relations/default.asp , 2009).Internal Environmental Analysis (Strengths Weakness)Strengths are resources and capabilities that allow the firm to complete important tasks. Resources can be the tangible and intangible assets held by the firm, and capabilities result when the firm integrates several different resources to complete a task or a series of related tasks. (Hoskisson/ Hitt/ Ireland, 2009)Weaknesses are those actions a company is not doing well or resources a company are lacking. Most importantly each business ingests to evaluate its strengths and weaknesses periodi knelly.Strengths and Weaknesses of SingTel are as follow hearty cash flowSingapores Top Ten Brands 2009 ranked number 6Exclusive call for with Apple 2008Right to broadcast the next trine seasons of the reckon Premier alliance (EPL)Lack of feasibility of a universal set-top boxLack of subjects for local pay TV marketStrengthsMost of SingTels strategic, av ailable and financial dynamics are currently improving. This is an indication that the companys current business strategies are proving to be successful.SingTel has a diverse spread of geographical operations. The companys main business activities are focused in Singapore and Australia and partners located in India, Belgium, Hong Kong, Thailand, the Philippines, Taiwan and Indonesia. The spread of geographical operations pull up stakes benefit the company, as it go out become less depend on the local market to generate revenues. Most of their businesses are experiencing double-digit revenue appendage over the past year (http//home.singtel.com/investor_relations/default.asp , 2009).SingTel captured the exclusive contract with Apple last year, and has since brought in more than 100,000 iPhones, thus increasing the companys revenue, the average spending per node for mobile data (http//home.singtel.com/investor_relations/default.asp , 2009).Taking sixth position for the Superbrands Survey, which determine over 500 of Singapores consumers favorite brands across 93 categories of consumer harvest-times and services demonstrated the consumers choice and trust in SingTels products and services (www.marketing-interactive.com/news/11875).SingTel outbid StarHub to score the coveted rights to broadcast the next three seasons of the incline Premier League (EPL) from 2010 to 2012. With the rights to broadcast the EPL, there will be a great potential that sports incline customers from StarHub will switch to SingTel (The Straits Time dated 11 November 2009).WeaknessesAs a leading telecommunication company in Asia, the customer service in SingTel has inhabit for improvement. Under the current extreme competitive environment, all the companies not only need to provide unique products but in addition good customer service. Thus, employee educational activity program could be provided in order to handle customers problems effectively.With acquire of the Pay TV license in the domestic market in Singapore, Singapore needs to look at the feasibility of a universal set-top box that will best benefits consumers and align with the government strategic direction. SingTels cable television subscribers complaining to the highest degree the hassle of having two set-top boxes may be a challenge that SingTel need to overcome (The Business Times dated 4 November 2009).External Environmental Analysis (Opportunities Threats)Opportunities are conditions in the firms external environment that may help the firm reach its vision (Hoskisson and Hitt, 2009). A marketing opportunity is an area of need in which a company can perform profitably. Opportunities can be listed and classified according to their attractiveness and the success profitability. (Kotler, Bowen and Makens, 2006)Threats are conditions in the firms external environment that may prevent the firm from reaching its vision (Hoskisson and Hitt, 2009). An environmental threat is a challenge posed by unfa vourable trend or developments that would lead, in the absence of defensive marketing action, to sales or profit deterioration. Threats can be classified according to their seriousness and probability of occurrence. (Kotler, Bowen and Makens, 2006)Opportunities and Treats of SingTel are as follow world-wide opportunities in mobile communicationRights to broadcast the World form 2010Potential merger of StarHub and Mobile 1 (M1)Australian market strong competitionOpportunitiesAfrica and Vietnam are markets in the emerging mobile space, which is definitely worth our interest, and SingTel is actively taking the lead to explore the untapped emerging telecom market. (Harry Suhartono, Nov 11,2009)Singapore and Australia accounted for 54 percent of the groups EBITDA , earnings before interest, taxes, depreciation and amortization and more opportunities for further growth. With SingTel outbid StarHub to score the coveted rights to broadcast the next three seasons of the English Premier Lea gue (EPL), there will be great opportunities to expand the customer-base for PayTV customers (http//home.singtel.com/investor_relations/default.asp , 2009).Moreover, with the exclusive right to broadcast the next three seasons of EPL, F1, the next opportunity for SingTel is Word Cup 2010. With clinch of the World Cup 2010, SingTel will dominate the Sports line of descents in the region.TreatsWith StarHub and MobileOne obtain licenses to sell Apples popular iPhone and their launched on 9 December 2009, SingTel lost the 15th months monopoly. Thus, will likely to face tougher competition in the local market.Potential merger of StarHub and MobileOne will be a hulking treats to SingTels Number One position in Singapore for mobile market in Singapore.SingTels subsidiary Optus is facing strong competition with their competitors in the Australia and maybe affects their leading position and revenges.With the competitive market, SingTel will put on to fight against StarHub and MobileOne th rough price, promotions, and advertising since all three companies main business are in the provision of mobile plans and the sale of mobile phones. Perhaps, SingTel may need to improve the customer service further to create a superior customer service that tag to their brandWith the winning of the broadcast rights for the English Premier League, it is expected that truehearted football fans will switch from StarHub over to SingTel, specially with the low rate offered by SingTel. Hence, competition is intense and SingTel would need to take on actions to further enhance its Strength whilst working on its Weaknesses.After evaluating the external and internal factors, SingTel started to develop strategies such as launching of Mio TV, which is able to capture more market packet and ultimately enhancing SingTels market position. Mio TV is a new technological product in the current market, thus, it is necessary for the company to assess the product life do the dishes per second (PLC ).Product Life Cycle jibe to Kotler, every product has its life. The product life daily round concept allows marketer to plan their marketing strategies to manage their product or service through various phases of their product life cycle. The purpose of this concept to establish which phase of its life cycle is and select the best fitted marketing strategies for the product in that phase.Base on Kotler (2000) the product life cycle can be divided into four distinct phases those are introduction, growth, adulthood and decline phases. Furthermore, Kotler also provided the following marketing characteristic, marketing objective and marketing strategies within its of the product life cycle phases.Characteristic according to Kotler, there are existing different characteristic sales, cost, profit, competitors and customer for its stages in the product life cycle. Those can be described as followSale characteristics sales are low in the introduction stages, rapidly increase in the gro wth stages, peaking in the maturity stages and decreasing in the decline stages.Cost characteristics the cost per customer will be high in the introductory stage, average cost per customer in the growth stage, and low cost per customer in the maturity and decline stage.Profit characteristic profits can be none or negative in the introductory stage, increase in the growth stage, and high in the maturity stage and reducing in the decline phase.Competitors characteristic there is existing only few competitors in the introductory stage, increasing in the growth stage, stable in the maturity and decreasing in the decline stage.Customer characteristic in the introductory stage has only few customers who call innovators are testing the product, early adopter essay the growth stage, a middle majority testing product in the maturity and the laggard trying the product in the decline stage.Marketing objectives Kotler also provides differences kinds of companys marketing objectives which link ed to four stages of product as belowIntroductory stage to make sensory faculty and psychometric test by using an intensive advertising and promotion campaign.Growth stage to maximize the market shareMaturity stage maintaining market share while profits can be still maximizeDecline stage reducing marketing expenditure of the product during this stage while the aim will be to milk the product.Marketing strategies the alternative marketing strategies was given by Kotler are related to various stage of the product life cycle as belowProduct strategy a basic product will be offered in the introductory stage, product extensions and warranties will be offered during growth stage, brand and individual product item will be diversified in the maturity stage and the weak model will be phased out during decline stage.Price strategy the cost plus price will be changed during introductory phase, price will be set to penetrate the market during the growth phase, the price will be set to meet co mpetitive price during the maturity phase while price will be turn out during the decline phase.Distribution strategy distribution will be built selectively during introductory phase, it will be intensive during growth phase, distribution will be further developed during the maturity phase and it will be more selective during decline phase.Advertising strategy building awareness of product among early adopter and dealers in the introductory phase, building awareness and interest in the mass market during the growth phase, stressing brand differences and benefits during the maturity phase and quash the advertising level needed to retain hard core-loyal customers in the decline phase.Sale promotion strategy using heavy promotion to entice trial during the introductory phase, reduced promotion to take favor of heavy customers demand during the growth phase, increase promotion to encourage brand switching in the maturity phase and reducing promotion to minimum in the decline phase.Li mitations of the Product Life Cycle ConceptThe term life cycle implies a percipient life cycle as observed in living organisms, but products do not have such a predictable life and the particular life cycle curves followed by different products vary substantially. Consequently, the life cycle concept is not well-suited for the forecasting of product sales. Furthermore, critics have argued that the product life cycle may become self-fulfilling. For example, if sales peak and then decline, managers may conclude that the product is in the decline phase and therefore cut the advertising budget, thus precipitating a further decline.Each customer is more or less free to adopt products for their own needs this is sometimes called the shopping serve approach to product adoption. However, in order to attract customer, not only should SingTel understand the PLC, it is also necessary for SingTel to analyze the competition and to be proactive to beat competitors in the current highly competi tive market. door harborers five forces is a framework for the industry analysis and business strategy development developed by Michael E. Porter of Harvard Business School in 1979. It uses concepts developing Industrial Organization (IO) economics to derive five forces that determine the competitive intensity and therefore attractiveness of a market. (http//en.wikipedia.org/wiki/Porter_five_forces_analysis)SingTels Competitive RivalrySingapore Telecommunications Limited is considered as the biggest telecommunication company in Singapore. Singtels services provide for customers with ISP (SingNet), IPTV (Mio TV), fixed line telephony and mobile phone. The second largest in mobile operator and cable television is StarHub, its also the biggest competitor of SingTel in Singapore.The recently moves of these two companies in cable television services have made the impacts on them. This also pointed out the effective strategy that SingTel approached over its competitors StarHub.StarHub us ed to be right holder of English Premium League, Champion League and it had to pay around US $150 million for the current 2007 to 2009. StarHub has provided attractive packages of television cable that includes so many sport and entertainment channels. Its really an advantage competitive of StarHub to increase its market shares over SingTel. StarHub actually has surpassed SingTel in this area and been really a big challenge of SingTel.However, a fantastic move of strategy from SingTel recently has changed things differently. StarHub has been beaten on bid and SingTel has won the right to be the holder of English Premium League and Champion League for its Mio TV. The ESPN Star Sports channel of StarHub cable networks will belong to SingTel in the middle of 2010 as well. The rights of ESPN Star Sport include English FA Cup, Formula One motor racing, Wimbledon tennis, US Open, Australian Open and US Open golf. These channels are going to Singtel, and this factor will definitely make in creasing number of Singtels subscribers.The failure of StarHub in command racing is not the end of its Television cable services. StarHubs platform still can present the English football with delayed telecasts matches on Goal TV 1 and Goal TV2 channels for its subscribers at present and future seasons.For Singtel, with the advantages in being the new holder of those channels, Singtel will have a contract of three years period. The contract will start in August 2010 and include mobile and internet rights as well as Television cable services. One thing is considered as promotion of Singtel, it will guarantee to keep the current payment of StarHubs subscribers and will not change anything.It will be Singtel, the company will deliver the English Barclay Premium League matches to Singapore. The ways of viewing live football matches on Television, on mobile phones and internet will be amend by Singtel. It will bring the best services to its football fans.On the other hand, SingTels comp etitor, StarHub still tries to maintain the best quality sport content to its customer. It now focuses more on shareholders expectations in terms of profits. StarHubs bid for Barclay Premium League was really aggressive. So now they look forward to the time when they can get back to right of being the holder. And StarHub is always a big challenge of SingTel. It could approach the opportunities anytime and get over SingTel in the future.Implication Analysis electrical shocks on viewing audienceMost of viewers from StarHub will not be happy when they have to change to SingTels Mio TV service for sports channels. The situation will be worst for the customers, who have signed the contract of two years with StarHub for sport package. The English Premium League and other sports content will now not be able to be viewed by them. The subscribers of StarHub need to sign up with SingTel as an addition if they would like to view sports content. When the viewers sign up for Mio TV service of S ingTel, they also need to install a SingTel fixed line in advance. SingTel has promised with the consumers to keep the pricing of sport content as the current StarHub rates and will not increase anything. It can be seen that, SingTel is giving a special promotion with special package for sports fans. The customers could subscribe to English Premium League and sports packages only of SingTel if they would like.Impact on Singapores Pay TV landscapeSingTel has taken a new step in TV cable service. Now its holding the right of English Premium League and other sports channels, and this will be a very important factor in competing more strongly with other TV providers, especially StarHub. Its really dominance of StarHub when it owns 85 % of market share of Singapore. However, SingTel now will be the only one that brings English Premium League and other sports content to Singapores football fans. Therefore, SingTel is expected to be the number one in providing TV cable services in the futu re.Impact on StarhubSince the IPTV of SingTel appeared in 2007, it has been a big challenge of StarHub. The development of SingTels IPTV has made StarHubs growth rate decrease to 4% year on year. StarHub had 530 grounds TV subscribers in the first half of 2009 and 250 thousand of them belong to the sports package. So being the achiever of the right holder of English Premium League, SingTel will affect StarHubs subscribers so much. Specially, SingTel will attract the attention of football fans directly. However, it is not complete ending for the StarHubs TV cable. StarHub still has other premium content like Star World, HBO, AXN and so on. The customers also need to sign up with StarHub if they wish to view this content. Among 250 thousand of sports package, 36% of them are expected to switch from StarHub to SingTels service. The rest subscribers are expected to sign up for SingTels sports package and still keep their StarHub service for premium content.Impact on SingTelTwenty thre e months since 2007, SingTels Mio TV service had grown so quickly, 100 thousand subscribers is the number of SingTel has reached in June 2009. SingTel has captured over 15% Singapore TV cable market. From April 2008 to March 2009, it has grow its subscribers over its rival StarHub by 79%. Together with the competitive advantage of being the winner of English Premium League and other sports channels, a number of 348 thousand new subscribers will be set for SingTel as an objective to achieve at the end of 2010. This objective will help SingTel to increase up to 42% share of Singapore Pay TV market. However, with the expensive bid like that, its also a long-term plan for SingTel to make IPTV business profitable. SingTel now is holding English football sports and US content pack, but its still not complete. SingTel need to keep its speed of growth and try to take over the premium content of StarHub. It could be the core factor, which can build the SingTels Mio TV cable services perfect ly.In the competitive market place, having a competitive advantage means that the firm is using its resources, capabilities, and core competencies in ways that create more cherish for customers compared to the value competitors products create for those customers. (Hoskisson/ Hitt/ Ireland, 2007) By launching the Mio TV, SingTel is able to gain a competitive edge, the reasons are as followCompetitive AdvantagesOne of telecommunication suppler SingTel provides national fixed-line services, mobile services, broadband, IP and internet access, and international telephone services more than 20 countries. SingTel still continue invest in strategic regional markets, including India, Indonesia, The Philippines, Thailand and Bangladesh for long term growth. accord to the Singapore Telecommunications Report that pay-TV subscriber base around 45,000 mioTV customers in June 2008. Over the quarter, there were some 2,000 net additions. The operator has continually expanded its range, they had fu rther agreements with three Hollywood studios includes Disney-ABC International Television, News Corp units Twentieth Century Fox and Time Warners Warner Bros International Television to raise mioTV channel go from 20 to 50.It is important for a company to develop their own distinctive competitive advantages. It must be unique, hard to imitate by competitors in the resembling industry and its create value to customers and benefit to the company.The Singapore-base telecommunication company Singtel has introduced pay-TV services called MIO TV. It has 33-channel mio TV and customers can select and pay what channel they want to watch.Features like the TV program list channel guide let viewers glance program in advance for 30 days. The mio TVs picture-in-Picture feature that viewer wont miss out other channel showing and remain current channel as well.The viewer can preview any video before notice from library of HD movies and video and make pause, rewind and fast-forward all depend o n customers.The viewer can enjoy high HD quality playback and control your favorite shows to watch and temperament just click of a button, you can record your favorite shows even when you away with Remote Digital Video Recording.The viewer can easy to await the favorite program by input keyword through remote control or via the virtual keyboard on the Television, the intuitive search engine offer intelligent results.The viewers can watch Channel NewsAsia, Mom-on-Demand and KBS world and some other available channels on the new mobile service, including the ads on Mio TV, as well as on mobile phone that SingTel selected Nokia phones to offer this service.The competitive advantage should be benefit to company increase shares of market and revenue returns and create value to shareholders, owners and customers. However, the competitive advantage may be imitate by competitors or create different advantages to more value to customers. One of the competitors of Singapore-base telecommuni cation company Starhub, they provide cable TV as well. But the exclusively offer by SingTel had been rewarded to broadcast UEFA Champions League and UEFA Europa League from 2009 to 2012. Subscribers can watch live matches broadcasting in Dual Sound both in English and Mandarin. Furthermore, SingTel had picked up a right to broadcast Barclays English Premier League matches and ESPN STAR Sports on Mio TV.According to director of Mio TV Low Ka Hoe said Sport content is an important part of our offering, and this move signifies our ongoing efforts to expand and improve our selection of quality content for our viewers,The world wide service of SingTel is a opportunity for the firm continually invest and expansion in core overseas market of Indonesia, India and new market such as Vietnam and Pakistan and beyond Asia Pacific. Overseas investments are an essential part of SingTel strategy especially in saturated domestic market of Singapore. According to Singapore Telecommunications Report SingTel in June 2008 and its foreign associates shared a total of 197.714 mn, representing an increase of 45% over the year and 8.2% during the quarter.Evaluate strategy base on competitive advantageThe firm should create non-replace and valuable competitive advantage through create strong core competencies. Base on competitive advantage, lessening Bowman and Richard DAveni use Strategy Clock to further explain Michael Porter s generic strategy. The strategy clock represents different positions in a market where customers have different requirements in terms of value for money. The organization may have unique resources that others cannot imitate or obtain, for example, long-term established brand be a cost leadership by apply price-based strategy or lower-priced strategy. However, in small domestic saturated market like Singapore, managers may take Differentiation strategy or hybrid strategy that provides unique or slightly different products and services from others to customer b y pricing slightly higher.The strong and well-established competitive advantages can strength companys capability and strategy decision making. Therefore,ConclusionIn account of analyzing the strategy of Singtel, it surly gave the reason that why the Singapore Telecom is Singapores largest telecommunications company. This company has nearly 130 years of operating experience in the successful completion of this period to the worlds leading high- performance carrier changes. In business, SingTel search a breakthrough innovation, development of local public sentiment for the internationalization of the business to treat the inability to adapt. Of course, these innovations are also based on SingTels own existing resources, it is an international network. More than that, Singtel not only in China for the global 5300 companies in different countries offer a wide price quite competitive telecommunications services, but also SingTel has built its domestic large-scale telecommunications net works, and the annual investment of 1 billion new coins to be updated in order to enhance domestic and international competitiveness. SingTels overseas investment is a long-term strategy. Currently, SingTel has expanded to 20 countries and regions, their overseas operations include not only the traditional fixed, mobile phone networks and the Internet, voice data, but also related to satellite communications, submarine cable systems. In the past 10 years, strong adaptability and technical advantages SingTels international strategy is to promote time and time again to be successful. Opportunities always favor those who prepared. SingTels long-term development plan formulated by it can, and be good at the right time, choosing the right investments. The use of a merger or investment to enter unfamili