phase 5 part1 market analysis; advantage and disadvantage; business option

Market Analysis

Based on the analysis and discussion made above, this report further looks into the future regarding
the next step of development for Optus and players in the telecommunication industry.

Opportunities and Threats

Standing on the summit of era of internet it is time to have a look at the back and look into the
future. Rapid growth in technology and application has dramatically changed our way of
communication in the past decades with a significant proportion of our daily communication tasks
and information flow uploaded to the internet world where the PC has become the access to the
huge world and data available from online. Simultaneously the reinvention of mobile phones has
opened the era of smart mobile device which far exceeds the traditional use of calling and texting of
phones but extends to almost all functions you need on the go. As telecommunication connection
serve provider Telstra has significantly benefited from the boom of internet and mobile phone
usage.

Looking into the future, the major opportunity still lies in the field of mobile device based service
and application. With hardware producers and software developers exploring into the mobile device
market in the past decade the industry has accumulated valuable experience and data in how the
customers use the new type of communication tools and how the tool could be further utilised for
more wonderful applications in real world. Opportunities for greater support service for mobile
device is still relevant for the market. This could be from both innovative technology ground
breaking break through and steady upgrade of existing technologies. The existing 3rd and 4th
generation of network still has the capacity for further improvements in coverage, stability and
speed. New technology for 5th generation of network could be turned into business development in
any time depending on the maturity of technology. Also the glass wire based NBN project also
significantly improves the PC internet market as well. Optus could find great opportunities in the
related services in these areas.

Together with the opportunities brought by mobile device, there are also threats. The most
important one is the obsolesce of telecommunication service. Traditional telecommunication still
heavily relies on infrastructures of copper wire and radio tower base stations which could be
possibly replaced by cheaper new technologies. Wireless network (WiFi) technology is a good
replacement if major obstacles could be overcome in the future. Wireless networks coverage for
entire city have come into practice in many cities around the world (Agustín-Blas, 2011). Visible light
based signal transmission technology or LiFi could potentially replace the existing infrastructure
network for signal transmission completely (Shahadat, 2014). This could significantly change the
operation model and environment of Optus as a service provider.

Alternative Blue Ocean Strategies

Blue Ocean strategy focuses on the exploration of new market where no existing competitor is in the
game which eliminates competition. For Optus, the blue ocean strategy is to explore new
telecommunication market and service. This report identifies two alternatives which are both
platform based. The first option is to deliver a platform based service where products and services
could be exchanged on the platform which is similar to a B2C and C2C platform but different in
features. The new platform should be based on mobile devices and provide easy access for end
users. The second option is to develop an application based service. The application would integrate
the function of real time communication, social network, business application and third party
payment functions. The application could be directly connected to Optus service as an access point
to end customers. Both strategy are based on the local community of customers which strengthen
their preference for local products. As a local brand Optus has the opportunity to enter into this new
mobile device based platform market which is not yet occupied by competitors.

The main advantage of blue ocean strategy is that in new market there is no existing competitors
which gives the company irreplaceable competitive advantages and bargaining power against
customers (Kim, 2004). Optus is an established service provider in the telecommunication industry
with established brand and loyal local customer base. As a result it is beneficial for Optus to transfer
its customer base onto its new proposed market area with ease. Blue Ocean strategy focuses on the
exploration of new markets based on the existing and available resources to an entity which
connects the past and the future (Kim, 2005).

The major disadvantage of the blue ocean strategy is that it involves higher risk. Expedition into new
markets with new products is risky business adventure without certainty in business success. No
competitors also indicates that there is no existing experience available to follow (Kim, 2005). Hence
the blue ocean strategy for Optus always require careful business planning and study to avoid failure
in the new market.
Reference

Agustín-Blas, L.E., Salcedo-Sanz, S., Vidales, P., Urueta, G., & Portilla-Figueras, J.A. (2011). Near
optimal citywide WiFi network deployment using a hybrid grouping genetic algorithm. Expert
Systems With Applications, 38(8), 9543-9556.

Md. Shahadat Hossain, Md. Samiul Islam, Afm Zainul Abadin, & Md. Anwar Hossain. (2014).
Methodology to Achieve Enhanced Data Transmission Rate using Li-Fi in VLC Technology.
International Journal of Engineering Research, 3(12), 803.

Kim, W., & Mauborgne, R. (2004). Blue ocean strategy. Harvard Business Review, 82(10), 76-84, 156.

Kim, W., & Mauborgne, Renee. (2005). California Management Review Vol. 47, p. 105-121.