Force 1 : Barries to entry
Barriers to entry measure how easy or difficult it is for new entrants to enter into the industry.
Microsoft had entered the mobile phone industry late, 1998, with no experience involving mobile phone software. However Microsoft manage to get benefits from $17 billion in cash more than they expect it to be.In a series of upgrades, Microsoft improved phone realibility and performance, while also building alliances with wireless network operators and phones manufacturers.
As for Palm, the Palm Pilot personal digital assistant redefined the PDA market, quickly achieving a us market share (among PDAs) that peaked at 70% in 1997, one year after it launch. Reviewers praised for Palm Pilot’s PCs, long battery life and modest cost. Although, Palm Centro gained share thanks to its low prices and user-friendly interface, boosting Palm’s market share back to 13% as of early 2008. In late 2003, Palm spun off its software into a separate company, called PalmSource, and Palm became a regular licensee of Palm OS. In September 2005, PalmSource was acquired by ACCESS, but Palm later repurchased the Palm OS source code from ACCESS so that Palm could modify the operating system without paying royalties to ACCESS.
However, Research in Motion Limited (RIMM) was the first to develop the first Blackberry smartphone – achieving critical acclaim for an unprecedented combination of voice capabilities with robush “push” email. Thanks to “push”,email arrived on user’s smartphones automatically – freeing users from checking mail manually, and greatly, and greatly improving device’s usefulness and reliability. RIMM’s market share had grown continuously since the introductions of the Blackberry smartphone in 2002.
A latecomer to smartphones, Apple took the market by storm with its June 2007 iPhone launch. The iPhones also made waves in product design thanks to its 3.5 inch touch screen, its motion-sensor switch to automatically sense screen orientation. Apple assembled them into a package that captured consumer’s attention. The iPhones appealing form factor and innovative design yielded rare reviews.
With its November 2007 announcement of the Open Handset Alliance (OHA) and the Google Android platform, Google prepared to enter the mobile telecom business. Google encourage development of third-party applications on Android by providing software developer’s kits (SDKs).
Force 2 : Threat of substitutes
How much does it cost the customer to switch to competing products or services?
Apples’s phenomenal rise in smartphones had taken the industry by surprise. A year after Clifford’s Barcelona comment welcoming Apple’s entry, Symbian and its licensees have to act fast to prevent Apple from becoming more of a threat than an opportunity.
The ability or the uses of the phone is the most important factor for the customers to switch the products or services to a better products. In addition, Apple is not the only newcomer(threat) to the smartphone industry. Soon after the launch of the first generation iPhone, Google announced that it would enter the mobile space through the creation of the Open Handset Alliance(OHA).
For those customers, the cost of the product is not important except it’s quality and also the application that the product provided.If a product can be easily substituded, then it is a threat to the company because it can only compete with price only.
Force 3 : Bargaining power of buyers
- · Buyer volume and concentration
If the volume or the concentration of the product is in a large amount, buyers will bargaining for the price.The supplier or the service provider will needed to tolerate with their price
- · Information
With a large information, buyers can differentiate what is the best for them. Example, among Symbian, Google and Apple, with the information of their product, buyers can decide which one among them have the highest value and are useful to them.
- · Negotiation
As buyers, they will do their best and give effort to lesser the price of the products. “ Less money, more product.” However, we as the supplier(have some share on the product) will only negotiate with them by increasing the amount of the product and lesser the price. This condition will benefit both party.
- · Loyalty of customers
From our view, loyalty of customers depend on the quality of the product, promotion and most important point is how we treat them as our customers. How can we make them be loyal to our product? Every company must have their own strategy to attract attention from customers. Apple’s product have attracted many phone’s user(customers) using their product design which is 3.5 inch touch screen, its support for rich “multitouch”interaction such as zooming and pinching, and its motion-sensor switch to automatically sense screen orientation. Others had develop most or all of these features previously, but Apple assembled them into a package that captured customers attention.
- · Price sensitivity
Buyers are also sensitive about the price of the product. However, we also think that not only the buyers, but the management or supplier of the product are sensitive about the price. They always want to provide a good and useful product for the customers or buyers.
Force 4: Bargaining power of suppliers
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- Strength of position as sellers
The strength of sellers are their product and the way they treat their customers.
- · Potential supplier
There is many potential suppliers that is competing to gain trust of the customers about their product.
- · Single VS group (concentration)
We have decided that having a group of supplier is important because it give more benefit to us as the sellers. We can negotiate more with them. This will give us benefit on the amount of the profit that we can make.
- · Amount of product from each of your supplier
The amount of the product will depend on the result of the negotiation that we can make from the supplier. However, the quality of the products is the most important factor to make a deal with the supplier.
- · Switching supplier (cost)
From our view, switching supplier is not as easy as it is said. A rigid and correct data with a concrete proof is required to switch supplier. This is because by switching supplier, it will not only destroy the image of the supplier, but also the relationship between supplier and sellers. Although, we would prefer negotiation more compared to switching supplier ( even if it will lesser the cost for the amount of the product ) because it would not benefit both party.
Force 5 : Rivalry among the existing players
- · Dominant or all equal in strength or size
The existing player has their own good and bad side. Some are good on strength and bad when talking about size. All players must have their own green button to regain.
- · Growing of the industries
The industry of mobile is growing rapidly and with the development of research of the technologies for the phones is growing rapidly among these several brands.
- · Differentiation of the product
Each product from each brand has their own specialities. Thus, it can be differentiate very well by the users.
