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TitleStrategic Audit of Vodafone
Tags Technology Economies Technology (General)
File Size2.4 MB
Total Pages35
Document Text Contents
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Cellular Service Providers:
As on Apr 2007 India has 167 million mobile phone subscribers. Out of this 125 million are
GSM users and 41 million CDMA users. BSNL, Bharti Airtel, Hutch, Idea, Aircel, Spice and
MTNL are the main GSM providers in India. Reliance Communications and Tata Indicom
are the main CDMA providers in India.

Bharti Airtel
Airtel is providing cellular services in Delhi, Mumbai, Kolkata, Chennai, Andhra Pradesh,
Gujarat, Haryana, Himachal Pradesh, Jammu and Kashmir, Karnataka, Kerala, Madhya
Pradesh, Maharashtra, Goa, Orissa, Punjab, Rajasthan, Tamil Nadu, UP and West Bengal.
Airtel is the No.1 cellular service provider in India using GSM technology. Airtel has 23%
market share in India with a total subscriber base of 38 million.

Reliance Communications
Reliance has both CDMA and GSM networks and total subscriber base of 29 million or 17%
market share. It has GSM network in Assam, Bihar, Himachal Pradesh, Kolkata, North East,
Madhya Pradesh, Orissa and West Bengal. Reliance has CDMA networks in other states and

Bharat Sanchar Nigam Limited (BSNL)
BSNL is a state owned telecom company which has GSM presence in almost every cities and
towns. BSNL has 27 million subscribers with a market share of 16%.

Vodafone is another emerging GSM provider in India with coverage in Kerala, Mumbai,
Delhi, Kolkata, Chennai, Gujarat, Andhra Pradesh, Karnataka and Punjab with a total
subscriber base of 27 million.

Tata Indicom
Tata Indicom is a main CDMA provider in India with 16 million subscribers all over India.
Tata Indicom has presence in almost every state and cities in India.

During Vodafone competitor analysis, I determined what would drive Vodafone's
competitors, as shown by their future objectives, what their competitor's are doing and can
do, as evidenced by their current strategies, what the competitor's believe about the industry,
as shown by their assumptions, and what the capabilities of competitors are, as shown by
their strengths and weaknesses.

1. Future objectives
Vodafone, unlike its competitors, focused exclusively on the mobile telephony market.
Vodafone believed that fixed-line operations would be a distraction from being a pure
wireless operator. This exclusive focus allowed Vodafone to offer sale and rental of mobile
phone handsets, transmission of both mobile voice and data, and support a wide range of
products and a variety of payment systems. Vodafone, unlike its competitors, had a focus

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Vodafone with the help of its correct marketing strategy & quality products & services at an
affordable price is one of the world’s leading telecom companies with the customer base of
over 250 million & the future plans & policies of Vodafone will help the company to achieve
its target of adding 500 million by the end of 2010.

An unattractive industry has low entry barriers, suppliers and buyers with strong bargaining
positions, strong competitive threats from product substitutes, and intense rivalry among
competitors. The mobile telephone industry has high entry barriers and a low threat of
product substitutes, but these attractive forces do not sufficiently offset the threats posed by
the strong bargaining position of suppliers and buyers in combinations with the intense
rivalry competitors face.

Vodafone is pursuing a focused cost leadership business-level strategy through their
exclusive focus on the mobile telephony industry. Because Vodafone did not have the
distractions that faced their competitors (such as fixed-line telephony) they are able to save
money and pass the savings to their customers or maintain a profit even when their closest
competitor is only achieving average returns. Vodafone maintained a broad competitive
scope and focused on cost for their competitive advantage.

Vodafone was in a superior financial position compared to its competitors, with substantial
assets and high operational efficiency. Vodafone is the largest player in the European mobile
telephony market through its newly acquired assets and organizational expertise. Vodafone
has a high gross margin and profit margin when compared to its competitors, making more
money per customer than its competitors, with more customers than its competitors. Across
the board, profit margins are decreasing at an increasing rate. In a fast cycle market such as
the mobile phone industry it is important to stay ahead of the curve and constantly improve
and search for better ways to accomplish the same goal at a low cost. By being first-mover,
Vodafone can retain high price points and profit margins compared to its competitors.

Over the years the Group has made excellent progress in executing against their strategic
goals however Vodafone is still looking to improve and remain innovative. They have
restructured the business to more closely align themselves to their strategic goals and have
outstanding and passionate leaders and people in the organization to deliver them. Their
commitment to deliver on their goals is supported by their values, which state that
“everything they we do is driven by our passion for customers, our people, results and the
world around us.”

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