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Background of DIGI
DIGI telecommunication Sdn Bhd is a mobile service provider in Malaysia. It is owned in majority by Telenor ASA of Norway with 49 percent. On 24 of March 1995, Digi became the first Telco in Malaysia to launch and operate a fully digital cellular network. Besides, in year 2004 DIGI were also the first to offer GPRS (2.5G) and later they had offer EDGE (2.75G) in Malaysia. DIGI primarily uses the GSM 1800 band with the network code of 50216. Other than that, DIGI also has listed on the Bursa Malaysia which under the infrastructure category. DiGi sister company, Pay By Mobile Sdn Bhd deals with electronic financial services, while its subsidiaries are DiGi Services Sdn Bhd (property holding, renting of premises) and Djuice.Com Sdn Bhd (others related services). DIGI is uses native dialling prefix identifier of „010‟, „016‟, „0143‟, „0146‟, as well as „0149‟ although with the implementation of mobile number portability mandated by the Malaysian government this does not apply to subscribes who switched from their old mobile service provider over to DIGI and at the moment switching to DIGI is free. In term of product and service, DIGI Telecommunication has provided variety mobile communication services such as voice under the prepaid plans and post paid plans, SMS, data plans and services, international roaming, international calling card and WAP services. The DIGI company also started a project that called „happy‟ and a group of DIGI staff has been assign to handle this special project and provide a new brand of Mobile Virtual Network Operators (MVNO) that also known as Happy Prepaid. And currently in 2010 DIGI became the second operator in Malaysia to offer the iPhone in month of April. (Wikipedia Foundation,Inc, 2001) DIGi has offer the plans more cheaply compared to Maxis iValue plans, while the price of iPhones sold are the higher than Maxis. Beside that, DIGI also be the first telecommunication company in Malaysia that introduce Mobile Number Selection service. And this service was implemented in 2008. This service can enable the subscriber to choose their own number instead of following the traditional way of purchasing a new SIM that has been pre assign fix mobile number. This kind of service can encourage customer satisfaction since they feel that DIGI is provided friendly service and close to them. (case study. DiGi telecommunication, 2009)
MGT 657 Page 1
DiGi telecommunication Sdn Bhd
Corporate Milestone • •
May 1995 April 1996 Dec 1997 Dec 1999 June 2002 Aug 2003 April 2004 May 2004 Aug 2004 Oct 2004 Jan 2006 Aug 2008 Dec 2009 April 2010
1st digital cellular network in Malaysia 1st digital cellular network in Sabah and Sarawak
1st telecommunication company to be listed on Bursa Malaysia.
• • • •
1st telecommunication company to introduce an e-pay system. 1st telecommunication company in Malaysia to GPRS
DiGi becomes 1st to launch MMS DiGi launches Malaysia's 1st Prepaid Online Billing. Launch of DiGi's EDGE 1st mobile to launch Mobile TV
• • • •
Flexi e-load and Talktime Transfer
DiGi Flexi E-Load for Postpaid. DiGi announced Deep Green to reduce 50% Carbon DiGi launch 3G services DiGi offer iPhone 3G services.
DiGi telecommunication Sdn Bhd
OBJECTIVE DIGI long term objective is “to create long tern shareholder value through providing innovative, easy-to-use and best value telecommunications service in the Malaysian market” (DiGi company Sdn Bhd, 2010)
THE VISION AND MISSION STATEMENT
Vision Enhancing communications to improve customers‟ quality of life… At home, work and play
Mission i Customer Provide customers with specific solutions to meet individual needs for communications, connectivity, and access to information and security
Concern for environment and society Contribute to improving life in Malaysia
iii Concern for employee Provide an environment where our employees can grow and be fulfilled
iv Shareholder Provide superior returns to shareholders
DiGi telecommunication Sdn Bhd DIGI COVERAGE MGT 657 Page 4 .
As a result. The management team of Digi works harder and smarter for the purpose of achieving the company‟s aim and target. (DiGi company Sdn Bhd. Digi has to ensure that they have enough knowledge about their own strengths and weaknesses as well as enough information on their close competitors.STRENGHTS i Strong Management Team Successes of one‟s company cannot be achieve without cooperation and support from the other member. strong management team plays an important role in a company since it can ensure the company are strong enough to face any threats and problem that occurred in the industry. Inside the company means that the communication among the company‟s member. Digi willing to spend about nine million in advertising in order to communicate and inform it product and service to the customer as well as to position it in the mind of the customers. For instance. Because of that. Digi can be considered as a company that has good communication either among it staff as well as with it customer. Digi should analyze the opportunities and grab it as well before the opportunity become the threats to them when it have been grab by the competitor. meanwhile outside the company means how the company communicate with the customer in term of the products and services offered. Each of them gives more focus on each of the task that given to them in order to ensure that the task can be done on time and give the great impact and result towards the company. For instance in 2001. 2010) S . Digi have that strength that enables the Digi Company to sustain and maintain in the competitive telecommunication industry. And fortunately. ii Effective Communication The effectiveness of the communication can be dividing into two which are inside and outside of the company. in case of DIGI this company need to compete with CELCOM and MAXIS.DiGi telecommunication Sdn Bhd SWOT ANALYSIS SWOT analysis is done in order to ensure that the company is able to compete in the competitive global market since there are few companies nowadays that offer the similar product and service. Effectiveness in communication can be a measurement of the company success MGT 657 Page 5 .
Furthermore. Digi also provide continuously improvement in order to develop the talent management by providing training and development program v Market In term of market. iv Men Digi has applied the flexible working hours for its employee. the company also provides care for the employee health and environment. iii Loyal Customers In business. The customer become loyal when they are satisfied with the product or service offered to them. Other than that. Digi has to ensure that these kinds of customers are loyal forever. Digi has entered the market of mobile broadband and mobile network service provider. it is harder for another competitor to switch them to use competitor‟s product or service. Digi‟s go to the market strategy base on LAS likely average speed-promised customer enjoy stable mobile internet connection. each of the company is trying to have their own loyal customer and same goes to Digi. Instead of difficulties faced by competitors to switch them towards their product or services. loyal customer also can bring good image of the company. MGT 657 Page 6 . Digi also has expanded it market by using electronic commerce or E-commerce that we knows this kind of market are having wide coverage and enable Digi to attract customers globally. Digi want to make its employee feel secure works with them and work in the happy environment. This is because once the company able to have the loyal customer. and as a result they will tell the others about their satisfaction. Since Digi has customers that being loyal to the company. Besides.DiGi telecommunication Sdn Bhd since it can create more customers and also create high motivation and loyalty employees.
ii Products and services expansion To be the a well established company.DiGi telecommunication Sdn Bhd W – WEAKNESSES i Number of Staff Needed Since Digi become bigger and bigger company and also has bigger market share. Digi must have to come out with excellent strategies in order to cover the cost and quickly can make a profit for the company. which a nationwide platform to cultivate the interest in music. The plan enable the Digi to have large opportunity to expose it product and service in international market and for sure enable the company to gain more profit. sports and arts and focus customer is at all aged. Product and service expansion that done by Digi giving them more opportunity to retain and attract more customers since Digi is available MGT 657 Page 7 . so that the management can reduce the number of task that delegate to each staff. It can ensure that each of the staff can put more effort and focus to each of the staff if they do not have to do much works. The company have to increase the number of the staff. the profit that they gain is not enough to cover the start up cost that had incurred. O – OPPORTUNITIES i Emerging markets and expansion abroad Digi has emerged the markets and plan to go abroad. In the other words. The company have to bear high cost as compared to the profit that they can gain. Digi has set few of the strategies and one of that is product and service expansion. ii Start up Cost is high The high cost that incurred during start up the company is part of the weaknesses of Digi. Dig has launched the DIGI LIVE Tour. The company does not profitable enough for this time and have to work harder if they want to stay long in this industry. Digi as well has made collaborative effort with Celcom Axiata in order to explore the potential of network sharing and to explore the new markets either locally and globally. the company need to hire more staff in order to give efficient and effective services to the customer.
For instance. Digi can grab this opportunity to increase the sale of it products. it is the largest mobile broadband and corporate services provider. Besides they already have lots of the loyal customer and difficult for Digi to compete. ii Network and System Failure The company is highly dependent on the technology such as key systems availability and uninterrupted network service in order to provide excellent service to its customers. with more than 160 million of customers across 10 Asian markets. Celcom itself is one of the world‟s largest telecommunication companies. iii Higher Living Standard in Malaysia Most Malaysian nowadays is able to afford at least one mobile (service provider) and broadband. These two companies are well known company and have strong market share. that covering over 98 percent of the population. The company continually works towards improving the availability of these key systems and network elements to ensure good customer experience and to exceed requirement set by regulatory bodies. Celcom has boasts the widest national 2G and 3G networks. Prolonged system downtime or network outages may severely affect customer experience and company revenue besides not meeting regulatory bodies‟ requirement. T – THREATS i Competition The competition become a threat to Digi because it need to compete with the establish telecommunication company such as Celcom and Maxis. Celcom is now moving towards integrated multi-access and multimedia services. MGT 657 Page 8 . in line with evolving technologies and consumer behaviour in Malaysia.DiGi telecommunication Sdn Bhd everywhere with many choices of plan offered as well as great service offered to the customer. Currently. Both of the company also have strong strategies in order to sustain and maintain in the telecommunication industry.
Kids actually have high power of influencer toward their parent.Inc.DiGi telecommunication Sdn Bhd iii Malaysian Government discourage cell phone usage among school kids Since the Malaysian government is discouraging the cell phone usage among the school kids. (Wikipedia Foundation. Digi able to increase the number of customer as well as profit. once Digi able to influence kids to use the product or service. 2001) MGT 657 Page 9 . it is become threat to Digi because kids are part of the best target market.
MGT 657 Page 10 . it is somewhat difficult and expensive to get an approve license due to MCMC strict requirements and procedures.DiGi telecommunication Sdn Bhd INDUSTRIAL ANALYSIS FOR DIGI PORTER’S FIVE FORCES Generally. License: Every potential entrant will need to obtain a license through MCMC. The Porter’s Five Forces Model Threat of New Entrants In general. simple yet powerful. Great competitive forces put more pressure on it while weaker competitive forces subdue the pressure. Porter‟s 5 Forces provide a good. a framework for developing an understanding of the competitive forces within DiGi‟s industry that influence its pricing decision. Several barriers are recognized: 1. telecommunications is not an easy entry industry despite the rumors of easy award of 4G spectrum of new entrants. However.
High Capital Investment: Other than expensive license. It might reach a few billion Ringgit Malaysia. The attractive of internet services making it more affordable to masses.DiGi telecommunication Sdn Bhd 2. It is not easy to copy or imitate. the pressure on the very low cost to use the phone calling internet or communicate through online messenger had threatened the mobile service industry. Threat of Substitute Products DiGi is operates through two business lines which is Voice and Data Services. fixed home line telephone. Advance Technology The advanced technology required in telecommunications industry not only incurred high capital investment but also need professional knowledge and skills likes human resources to ensure success in the industry. Voice Services: Many traditional and modern substitute such as letter. MGT 657 Page 11 . In addition. fax and email. Then. Mild threats of substitute products for both of the business line are recognized: 1. broadband Internet services which enable faster and always on connection to the worldwide web. Consumers have become more demanding in quality broadband service and this create an opportunity for new entrants to provide a substitute product for consumers in lower price or better performance than the existing ones. 3. 2. offer more promising growth potential. Data Services: This data services is focusing more on broadband. DiGi also required high fixed costs and spend relatively large on network equipment and to maintain development.
They try to gain competitive advantage through low call rate and price. Celcom triumphantly clinched 3 awards at the 2010 – the much coveted 'Service Provider of the Year' (2nd consecutive year). Yet. together with Telekom. within the industry. 'Broadband Service Provider of the Year' Award and 'Mobile Service Provider of the Year' Award thus further reaffirming its strength as one of the market leader. Maxis. The telecommunications industry has also been undergoing gradual liberalization since 1985. the industry witnessed more competition in various segments of mobile. the Malaysian government-dominated enterprise. and the functioning of the sector became more transparent. Each of them also invests a lot on advertising to promote their product – successful maintaining their place in Malaysia Top 10 Advertising high spenders list from Jan – June 2010 as shown: MGT 657 Page 12 .DiGi telecommunication Sdn Bhd Industrial Rivalry Malaysia mobile market is oligopoly nowadays after the consolidation in 2003. Celcom and DiGi continue to compete on differentiation of products and services through improvement and introduction of new innovative features – aspects such as call rates. package price and so on. Gradually. Early 2010 seems to favour Celcom when at the 2010 Frost & Sullivan Malaysia Telecoms Awards. granted a number of licenses to private sector telecommunication operators. fixed line and telephony services. when Telekom.
Then. Maxis re-enter the fixed broadband market in a way that surprise many. Just to be in the game. Ericcson and Trisilco Folec.DiGi telecommunication Sdn Bhd Other expected development in 2010 (dub the broadband year for Malaysia) will be plenty of new devices and packages flooding the market place. “sizzle” the market with a grand entry in July. and DiGi maintains close working relationships with key network equipment suppliers. Time dotCom – a company many say is history – will re-emerge while YTL. Previously. The factors that contributing to these is recognized: 1. MGT 657 Page 13 . Siemens. U Mobile managed to launch its broadband service known as XFone at the 11th hour of 2009. DiGi have limited choices. the telecommunications industry in Malaysia is dependent on imports for majority of its network components as most of the equipment cannot be sourced locally resulting in high bargaining powers of suppliers. And there is Tune Talk which is eager to eat into every operator‟s customer base with its smashingly cool pricing. For example. the bargaining power of those suppliers becomes stronger. most of the GSM equipment for DiGi‟s mobile network operations are purchased from large international companies that increase the size of supplier power such as Motorola. As there are relatively very few suppliers in this market. Since Siemens is now a sub-contractor of Motorola for network switching systems. which has been grossly overselling its WiMAX 4G idea. Limited Supplier: DiGi networks utilize standard GSM equipment which is available from a limited number of suppliers. Telekom is expected to deliver its HSBB in some areas even if it is for trials (launch “UniFi” on 24th March with free trial until 30th June 2010). Bargaining Power of Supplier Generally. DiGi left with two main suppliers: Ericcson and Trilsilco Folec. Thus. and the possibility of fixed broadband players stealing some market share from wireless players.
DiGi telecommunication Sdn Bhd 2. There are many alternatives product such as fax. this would affect its business operations and margins. MGT 657 Page 14 . the intense rivalry among mobile and broadband service providers only benefit the consumers who can enjoy lower price broadband and mobile services. and eventually making then more powerful hence. low switching cost. quality and use of intellectual property. and switching between contract manufacturers may therefore be a more costly process. If a company is not able to source required components in adequate quantities. email and internet which enhance the bargaining power of buyer to the mobile service provider. DiGi believes that comparable equipment and support will be available from other established suppliers. Customer also becomes more demanding of high speed broadband which is less costly but yield wider coverage and after sale service. In addition. High Switching Cost: As DiGi cannot manufacture in-house. such a supply structure usually means lower control on the delivery schedules and may cause component shortages due to manufacturing process issues. As a consequences. creating a relatively high competitive industry. the other viable options which is third party manufacturing contracts may post complexity with terms covering cost. Any persistent shortages in supplies due to capacity issues or manufacturing process issues would increase the price of manufactured products. Bargaining Power of Customers Information technology increase the bargaining power of buyer and high availability of information makes it easier for customers to evaluate sources of materials about telecommunication. In the future.
2010) 1. Product development 4.DiGi telecommunication Sdn Bhd STRATEGY OF DIGI. market penetration seek to increase market share for existing products in existing markets through greater marketing effect that encourage more usage and spending among consumers. Refer to the chart below: MGT 657 Page 15 . DiGi’s Intensive Strategies – Market Penetration: As simplified by the figure. Market development 3.COM BHD DiGi used 4 possible types of strategies which are: (Chan King Hooi. DiGi had invested heavily on advertising to promote their product and successfully maintaining their place in Malaysia Top 10 Advertising high spenders list from Jan – June 2010 making it viable for them to do so budget wise. In the 1st half of 2010. Market penetration 2. 1. Forward integration vertical strategies intensive strategies The first 3 is known as intensive strategies while the last one is from of vertical strategies – however it is only focuses on deliberation of intensive strategies.
Provide Consistent Good Services 1. Malaysian General Public MGT 657 Page 16 . 2.Prepaid offered that voice rate of rate of 12 cents / minute nationwide to ALL networks and SMS rate of 1 cent (DiGi to DiGi only) when daily usage reaches RM1. . sports. EDGE (Enhanced Data rates for Global Evolution). broadband (business solution).Corporate website (information on mobile and others frequently used question. budget and average call volume. some package even combine unlimited internet (data plan).Fixed and mobile telephony (9prepaid. Business Entity: . Provide consistent good services to existing customers. Business Entity 3. internet) Data Services: . internet.Family plan. Foreign Workers 4. Increase Customer Rewards 1. specialized store. Customer Support: . talktime transfer.Business monthly business call plans depending on size of business. GPRS. postpaid. music. offerings and outdoor gathering in “hot button” of youth lifestyle areas (gaming.Plenty of mobile application.Dial-up mobile and broadband internet. Increase customer rewards 2. pictures messages and etc). technical chat fuction – online and by phone. messaging Market Penetration 1. Malaysian Digital Native Mostly youth below 24 years old who are technologically driven and savvy.Concept store equip with Simbioz sustem (DiGi 360o 1. service countries and dealers (prepaid and postpaid) . Foreign Workers and Malaysian General Public: . .DiGi telecommunication Sdn Bhd DiGi’s Existing Markets and Products with their potential Market Penetration Strategies: Existing Products Existing Markets Voices Services: . weather forecast.BonusLink Points based on monthly usage bill for postpaid mobile and broadband. movie. 2.Nationwide centre. enterprise and immediate family members. flexi eload (top-up) . 3. Malaysian Digital Native: . TV show.
low cost housing areas and tourist spots (high foreign worker patron during public holiday) are a few areas that need broader access to communication infrastructure although affordability is low. MCMC under USP target to reach 97% national population coverage for cellular by 2012. DiGi and Celcom on signed a Memorandum of Understanding (MoU) on infrastructure sharing at both company (DiGi and Celcom) and group level (Telenor and Axiata) benefiting DiGi on access to Celcom‟s well publicized whole Malaysian coverage.DiGi telecommunication Sdn Bhd 2. cellular coverage area was 95% (Peninsular) and 77% (East Malaysia). DiGi is entitled to claim certain qualified expenses from the MCMC in relation to USP projects. Rural. In June 2010. 2010). DiGi’s Intensive Strategies – Market Development: As simplified by the figure above. market development is the term used in introducing existing products to new markets – can be new geographic areas or currently underserved communities (DiGi recognized two sources of new markets : potential or new foreign workers and rural communities). As a USP. May 2010 national populations‟ coverage for cellular improved to 94% (MCMC. suburban. MGT 657 Page 17 . Supporting Factors Market Development: According to Malaysian Communications and Multimedia Commission (MCMC) back in August 2007.
.Up to April 2010. postpaid.Prepaid long distance savers plan for foreigners from Saudi Arabia and UAE.Lundu CBC is equipped with facilities that include 20 dekstop computers connected to DiGi’s Turbo 3GTM network with a minimum speed of 2Mbps and others gadgets such as printer. Continuously pursue USP obligation by providing access to basic telephony communication to districts designed to DiGi. Kelantan. Terengganu. Provide myriad international services.International Calling Card (Chartz and Desher Kotha). Page 18 MGT 657 . back in home country or anywhere on Earth) no charges when receiving SMS but sending it at low flat rate of 99 cents. copier machine as well as an LCD projector. When roaming abroad (eg. RM1. Melaka. Provide myriad international services Potential or New Foreign Markets: International Direct Dial (IDD) prepaid and postpaid with rates as low as 13 cents/minute for call to both mobile and fixed line recipients around the world. DiGi was provisioned 13 Community Broadband Centre (CBC) site in various areas in Malaysia (Sarawak. messaging New Market Market Development 1.Cakap-cakap (from 9pm – 9am) for foreigners from Pakistan. Vietnam. .50 per International SMS.Fixed and mobile telephony (9prepaid. Johor.DiGi telecommunication Sdn Bhd DiGi‟s New Market to Existing Product with their Potential Market Development Strategies: Existing Products Voices Services: . . DiGi had officially launced CBC in Landu (Sarawak) and Kampung Teriang Besar (Johor) . Offer a few special rates package: . . scanner. internet) Data Services: Dial-up mobile and broadband internet. and Indonesia. Nepal. 2. DiGi had provided 6000 household fixed lines and 300 payphones to 7 under-served districts in Malaysia. In-flight mobile services. Potential or New Foreign Market Rural Communinties Continuously pursue USP obligation by providing access to basic telephony communications to districts designated to DiGi Rural Communities: Up to 2010.Cakap-cakap lagi (from 12am – 2pm) for foreigners from India and Indonesia. Pahang) under USP.
DiGi’s Intensive Strategies – Product Development: As simplified by the figure above. This is especially important in the era whereby global consumer multitask with their mobile device. product development seeks to increase sales and profit by improving and modifying present products or services or developing new ones for its existing markets. MGT 657 Page 19 .DiGi telecommunication Sdn Bhd 3.
and the Philippines in a secure manner – direct debit their local banks in the beneficiary’s country or cash pick-up at designated agents. Encourage other service provider users (mobile. Business Entity 3. iPhone. Stand ahead of the competitors and encourage consumers to switch to DiGi with the slogan “IT’S TIME TO CHANGE TO DIGI” Produce new and tech savvy product to prevent going outdated Malaysian overnight.DiGi telecommunication Sdn Bhd DiGi’s Existing Markets to New Products with their Potential Product Development Strategies New Product Existing Markets Voices Services: combine postpaid and prepaid for family packages Data Services: smartphone (Blackberry. Business Entity: Offer Blackberry® Solution with help from Research in Motion (RIM) Foreign Workers and Malaysian General Public: Partnering Citibank to allow subscribers to transfer funds via SMS up to RM5000 from Malaysia to Indonesia. iPod Touch. 1. Bring to Malaysians Huawei portable wireless router – MiFi (Mobile WiFi Device) that can have 5 different WiFi (eg: combination iPad. Bangladesh. DiGiREMITTM Personal Accident Insurance Product Development Joint venture with handheld mobile providers to include latest technologies and internet function into mobile. MiFi. Open Android apps for wider away of phones. HTC. Malaysian Digital Native Mostly youth below 24 years old who are technologically driven and savvy. Blackberry and laptop or netbook) enabled devices to connect to the internet simultaneously. smartphone) to switch to DiGi manu rate plans while retaining the original number at no extra cost (DiGi is absorbing it) Offer DG Family™ that allows combination of prepaid and postpaid as supplementary line. Partnering AIG to entitled subscribers with > 3 months’ tenure Personal Accident Insurance coverage via SMS activation. 3Gs and 4s. Malaysian General Public MGT 657 Page 20 . Foreign Workers 4. Android apps. iPhone). Partnering HSBC Credit Card and Guess to lure potential iPhone owner with DiGi Plan through 24 months Easy Payment Plan plus a free GUESS iPhone casing. 2. Digital Native: Tie up with Apple Inc for the rights to distribute iPhone 3G.
smartphones and mobile/wireless broadband) into 4 quadrants that consists of Question Marks. MGT 657 Page 21 . QUESTION MARKS: MOBILE/WIRELESS BROADBAND (DATA SERVICES) relative market share: LOW As highlighted before. Stars.DiGi telecommunication Sdn Bhd DiGi BCG Matrix The following BCG matrix classified 4 DiGi‟s SBU (prepaid and postpaid. Cash Cows and Dogs. DiGi was having the smallest market share in 2009 since it is need to compete with the largest competitor such as Celcom and Maxis. U Mobile and Tune Talk. YTL. DiGi BCG Matrix Justifications and Strategies This justifies section on DiGi BCG Matrix by quadrant and also looks at possible strategies to handle the respective SBU. As part of that the market is also getting crowded with many new entries in 2010 such as Time dotCom. fixed telephony.
DiGi telecommunication Sdn Bhd market growth rate: HIGH there are high market growth in question mark because of rising penetration rate of broadband subscribers (per 100 household) which are 4th Quarter of 2009 = 31. 1st Quarter of 2010 = 34. internet.5% Malaysian government give their support through National Broadband Initiative (NBI) which aims to achieve 50% Malaysian household (both wired and wireless mobile) broadband penetration by the end of 2010.plenty of offerings and outdoor gathering in “hot buttons” of youth lifestyle areas (gaming. weather forecast.7%. challenge for DiGi DiGi have a intention to increase mobile/wireless market share quickly so that it might become Stars and eventual CashCows or it will become Dogs.5%. and 2nd Quarter of 2010 = 37. This kind of intention becomes the big challenge for DiGi company in order to become well established the company globally.BonusLink points based on monthly usage bill for postpaid broadband subscribers MGT 657 Page 22 . games etc) . sports. movie. strategies The strategies that DiGi can done such as: invest RM350 million for mobile broadband expansion as part of its plans to improve its infrastructure market penetration: increase customer rewards and provide consistent good services to existing customers . music. TV show.various monthly broadband (business solutions) depending on size and budget of business entity .
Kelantan. And smartphones had contributed to the DiGi fast-growing mobile Internet market. DiGi is having a high market share for smartphones as they are selling Malaysian favourites (refer pie chart and table below): RIM‟s Blackberry. HTC Desire. Melaka.DiGi telecommunication Sdn Bhd market development: build CBC for rural communities in various areas in Malaysia (Sarawak. Johor. HTC Legend. iPod Touch. amongst others. Sony Ericsson Xperia 10 and Motorola Milestones. Terengganu and Pahang) product development: bring to Malaysians Huawei portable wireless router – MiFi (Mobile WiFi Device) that can have 5 different WiFi (eg combination: iPad. MGT 657 Page 23 . iPhone. Blackberry and laptop or netbook) enabled devices to connect to the Internet simultaneously STARS: SMARTPHONES (DATA SERVICES) relative market share: HIGH we do not have the exact figures disclose but relatively. Apple‟s Iphone and Google‟s open-source Android operating system phones such as Samsung Galaxy S.
the potential market for mobile Internet (through smartphones) is large as there are more million of mobile phones in use in Malaysia which is more than 10 times the estimated number of laptops and netbooks owners as of 2nd Quarter of 2010. strategies The strategies in STARS that DiGi can adapt as follows: market penetration: increase customer rewards and provide consistent good services to existing customers . Besides. challenge for DiGi DiGi want to maintain or strengthen dominant positions of smartphones as Stars because it is DiGi best long run opportunities for growth and profitability plus growing it into Cash Cows.reduce fees to replace standard SIM card with Micro SIM MGT 657 Page 24 .various data-centric packages to cater to the growing number of mobile Internet (smartphone) users . It also can contribute the increasing of profit to DiGi.DiGi telecommunication Sdn Bhd market growth rate: HIGH Even though the percentage ownership of smartphones is still low but its popularity is rising rapidly.
DiGi do not disclose exact figures for its prepaid and postpaid subscribers (voice services) but lump it together with broadband customers. market growth rate: LOW The phenomenon on declining voice revenue is an occurrence worldwide but it is expected to remain as the main revenue earner.invest RM100 million over the next 3 years in Perak and Sarawak to expand its mobile internet services footprint beyond 5 key market centres (Klang Valley. The mobile voice revenue is expected to grow by 6% annually until 2013. Penang. CASH COWS: PREPAID AND POSTPAID (VOICE SERVICES) relative market share: HIGH DiGi market share for prepaid and postpaid is relatively high up to 2nd Quarter of 2010 as shown in pie chart below. However.DiGi telecommunication Sdn Bhd market development: aggressively push sales of smartphones . MGT 657 Page 25 . Kota Kinabalu.encourage other service provider smartphone to switch to DiGi many rate plans while retaining the original number at no extra cost (DiGi is absorbing it) . Ipoh and Kuching) product development: joint venture with handheld mobile providers to include latest technologies and internet function into mobile.
1st Quarter of 2010 = 44. market growth rate: LOW Almost stagnant penetration rate of fixed line telephone subscribers (per 100 householders) such as in 4th Quarter of 2009 = 43.DG Family™ package allows combining prepaid and postpaid as supplementary line .9%.Happy prepaid37 east coast edition (Kelantan and Terengganu) targeting value seekers that mainly use their mobiles to just make calls and SMS retrenchment .0%. 2nd Quarter of 2010 = 44.0%. The fixed-line voice revenue is expected to decline 4% annually until 2013. This is maybe cause by the DiGi coverage that most of the people claimed it is not too good as Celcom and Maxis. DiGi maintain its prepaid and postpaid strong position for as long as strategies The strategies adapted: product development . MGT 657 Page 26 .eliminate DiGi Prepaid™ Campus package .maintaining prepaid and improving postpaid momentum by offering handset bundles .DiGi telecommunication Sdn Bhd challenge for DiGi possible as Cash Cows since it was yesterday‟s Stars to finance mobile/wireless broadband (Question Marks) and Smartphones (Stars) So.eliminate paper billing for postpaid subscribers DOG: FIXED TELEPHONY (VOICE SERVICES) relative market share: LOW The market share of DiGi low since it was having tiny market share in 2009.
DiGi telecommunication Sdn Bhd challenge for DiGi DiGi have avoid or maintain fixed line telephony which is weak internal and externally as Dogs Cash if there is some profit since expensive turn-around plans usually do not help the DiGi company to survive in the competitive telecommunication industry.eliminate fixed line telephony . strategies retrenchment is strategy suggested for DiGi since it can .continuously provide payphones and household fixed lines as part of obligation to provide access to basic telephony communications in rural community districts designated to DiGi under Universal Service Provision (USP) MGT 657 Page 27 . .
we also can see that we need to be more careful when we want to choose something or decide something. we need to always learn from the experienced and any situation that happen among us. from this case we learn to be brave if we are going to jump into business especially for the competitive industry. We have to adopt it and make it as guidance for us in our life either for our personnel life or in our jobs. This is same goes for the case of Digi which there are lots of lesson that we can learn and knows. Interpret the market for the purpose to set the accurate strategy that being use in order to sustain and expand the business. Digi is trying to interpret the current situation in industry especially in term of market. from the case we also can learn on how to interpret of something or situation. Digi have go through a lot of research to make sure that the strategy is suitable for them to use to compete in the industry. MGT 657 Page 28 . Also with the hope that they can increase their market shares. Other than that. The company are brave enough to take a risk once they are decided to jump into this industry and they are confident that they able to experienced and faced the risky condition in telecommunication industry. it is shows that how the company is brave enough to do business in telecommunication lines since we all knows that this kind of industry that have strong competitors who compete in the industry. Besides that. This is because. they always need to review and renew all of the decision that they have make and take to ensure that it is applicable for the time being. Digi also are braver enough to do the 4 strategy in maintaining and boost their business and market share even though it involves a large cost. for instance in Digi‟s case.DiGi telecommunication Sdn Bhd LESSON As human being. In case of Digi for example. Before making the decision to used the 4 strategies. One of that is. For example when Digi decide to invests 9 million on the advertisement to communicate with the customer. Digi.
MGT 657 Page 29 . It also important to make sure that the employee can always review the mission statement to make them remember what is the target of the company. On the other hand it also make the task given can be done easily with happy felling.DiGi telecommunication Sdn Bhd BENEFIT We can get a lot of benefit from this case for example we are able to gain more knowledge especially about the telecommunication industry. from this assignment. when the company is practicing strategic management it also can ensure that the company can run smoothly with more efficient and effective ways. Digi also is trying to win the market share by investing a large sum of amount in the advertising to communicate with the customers. Thirdly. Last but not least. The mission and vision statement is very important to the company to make sure that they are always staying in the purpose of their business. We also learn on how to be more tolerate as well as being more responsible among group member. 2G. we can know how these telecommunication companies are compete to each other and how they set the strategy for the purpose to sustain and maintain their own company. we can also see that it is important for the company to practice strategic management to make sure that the company can achieve the vision and mission statement very well. Besides that. 3G and others. this assignment also make us become close to each other since we need to communicate and discuss this case in order to do the best for this assignment. From this case. Second benefit is we also able to know about how the company nowadays adapt with the technology to maintain its competitive advantage. Toleration between group members is the most important things because it can unite the group member. From this. we can see that Digi is trying harder to stay competitive in the market by adapting the new telecommunication technology such as the edge.
As whole the most important things to be done by Digi is to increase their coverage in Peninsular Malaysia compatible with East Malaysia. Digi has to expedite their broadband coverage to whole Malaysia since currently the broadband coverage monopolize by Celcom. Safety. MGT 657 Page 30 . Digi also can set up their owns R&D center and developers program to help provide better value added services to Digi users. Moreover. With their own R&D center Digi can create new idea and package different from its competitor. Business Strategies Digi can increase more capacities in their biggest market share. 2010) Functional Strategies: Bring in competent human capital with new blood. For example Digi can provide the assurance program their valued customer by charging RM1 on their bills. Digi also can improve and increase efficiency and capacity of service to attract and retain more customer. specialized store. corporate website. and increase recruiting experienced local and overseas talent. Security and Environment Assurance program. Digi can further improvement for consistent good services in terms of customer support. nationwide centers. (Ching. especially metropolitan areas like Kuala Lumpur. Besides. FAQ. service counters. intensive training to present staff. Digi must upgrade their contribution to the society and environment by focusing and improving Digi Supply Health. Digi must increase the skill of the employees to improve their performance. It is because the opportunity for the company to have more usage on the service is bigger in the metropolitan area. corporate strategy and also business strategy.DiGi telecommunication Sdn Bhd RECOMMENDATION We have three recommendations for this company which is for the functional strategy. dealers. With this charge they can provide the health insurance to cover any injured. Digi can hire fresh graduate to fulfill the job vacancy in the company because Digi can exploit new idea from them.
(Ching.DiGi telecommunication Sdn Bhd Corporate Social Responsibility : Digi has to increase its corporate social responsibility. sport program. For example they can sponsor educational program. 2010) MGT 657 Page 31 . and health program to strengthen Digi brand.
DiGi telecommunication Sdn Bhd CONCLUSION As a conclusion. Digi has done the best effort to gain profit and stay competitive in the market. As a result they plan to modernise the network such as infrastructure to improve the service given to the customers as well to drive the cost efficiency. Digi also has done the best to show its competitive advantage to put it company in the same rank as it competitor which are Celcom and Maxis. Digi want the customers have experienced the exciting telecommunication products and services with them. MGT 657 Page 32 . Digi try to show how it concern enough to it customers by claim and make a promised to the customer that they are always the best choice for customer in the telecommunication product and services.
(2010).Inc.DiGi telecommunication Sdn Bhd REFERENCES (2009).slideshare. (2010). 2011.40379775/DiGi-strategies- management DiGi company Sdn Bhd. January 7).slideshare. Chan King Hooi. Retrieved november 20. DiGi telecommunication. United State: www. Wikipedia Foundation. november 18). Retrieved november 26. Retrieved November 12.sugarcrm. (2001.wikipedia. Malaysia: DiGi SDN BHD. annual report. from www.org: http:en. from www. 2011.com. Y. (2010. from Slideshares: http://www. 2011.org/wiki/DiGi-Telecommunications MGT 657 Page 33 .net: www.net/jonathanleong/digi-group-v-presentation-20110109 Ching. case study. e.com/doc. K.wikipedia.scribd. GSM Shaping Leaders.
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