Collaborations are becoming more and more popular, especially in hard times like now, where the economy still hasn’t recovered from the recession and many of the companies which have been hit are still struggling to recover. For our company, we believe that collaboration can indeed bring some fresh wind and be of a huge advantage. One of the potential companies which we believe can deliver this is OnLive. Another possible collaboration could be a joint venture with a network operator. A network operator, as for example one of the
3 major players of the US (Sprint, Verizon or AT&T), which already have adapted LTE technology, can be of huge benefit to our company.
If we choose LTE or LTE Advance as our future technology the expected growth will be very fast rather than any technology ever. Long-Term Evolution (LTE) mobile broadband technology is set for a surge in growth over the next four years, according to new research from In-Stat. Between now and 2015, the number of people signed up for the next-generation service will increase by
3,400 per cent, the market intelligence firm claimed. So this is quite obvious that
4G and devices related to 4G will have a high growth as predicted by the analysts.
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4. Current & Proposed Technological Standards
Technological Standards
Wireless data communications are an essential component of mobile computing. The various available technologies differ in local availability, coverage range and performance, and in some circumstances users must be able to employ multiple connection types and switch between them. Cellular data service offers effective coverage within a range of 10-15 miles from the nearest cell site. Speeds have increased as technologies have evolved, from earlier technologies such as GSM, CDMA and GPRS, or 3G networks to such
as 4G, LTE, LTE-A, WiMAX Advance etc. Let’s take a short look on those advance network technologies.
4G
In telecommunications, 4G is the fourth generation of cellular wireless standards. It is a successor to the 3G and 2G families of standards. Requirements for 4G standards, are 100 Mbit/s for high mobility communication (such as from trains and cars) and 1 Gbit/s for low mobility communication (such as pedestrians and stationary users).
A 4G system is expected to provide a comprehensive and secure all-IP based mobile broadband solution to laptop computer wireless modems, smartphones, and other mobile devices. Facilities such as ultra-broadband Internet access, IP telephony, gaming services, and streamed multimedia may be provided to users. In 4G mobile communication there are some predecessors which are:
3GPP Long Term Evolution (LTE)
The pre-4G technology 3GPP Long Term Evolution (LTE) is often branded "4G", but the first LTE release does not fully comply with the IMT-Advanced requirements.
Data speeds of LTE are given below:
Data speeds of LTE
Peak Download 100 Mbit/s
Peak Upload 50 Mbit/s
LTE Advanced
LTE Advanced (Long-term-evolution Advanced) is a candidate for IMT- Advanced standard, formally submitted by the 3GPP organization to ITU-T in
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the fall 2009, and expected to be released in 2012. LTE Advanced is essentially an enhancement to LTE. It is not a new technology but rather an improvement on the existing LTE network. This upgrade path makes it more cost effective for vendors to offer LTE and then upgrade to LTE Advanced which is similar to the upgrade from WCDMA to HSPA. LTE and LTE Advanced will also make use of additional spectrum and multiplexing to allow it to achieve higher data speeds.
Data speeds of LTE Advanced are given below:
Data speeds of LTE Advanced
Peak Download 1 Gbit/s
Peak Upload 500 Mbit/s
Mobile WiMAX (IEEE 802.16e)
The Mobile WiMAX (IEEE 802.16e-2005) mobile wireless broadband access
(MWBA) standard (also known as WiBro in South Korea) is sometimes branded
4G. In June 2006, the world's first commercial mobile WiMAX service was opened by KT in Seoul, South Korea.
Data speeds of WiMAX are given below:
Data speeds of WiMAX
Peak Download 128 Mbit/s
Peak Upload 64 Mbit/s
5. Time of Entry
Factors we have to consider
1. Certainty of customer preferences
2. Improvement over previous solution
3. Need for enabling technologies
4. Availability of complementary goods
5. Threat of competitive entry
6. Dominant Design
7. Withstand with early losses
8. Resources to accelerate acceptance
9. Reputation
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Our Strategies
➢ As we are focusing on the technology called “LTE” or “LTE-A” which already proves (more than 80 countries are investing in LTE right now) their clear advantages to customers, entering the market early may give us a path-dependent advantages that is nearly going to be impossible for competitors to overcome. In that case we do not need to consider the certainty of customer preferences.
➢ As our proposed technology (LTE) is a different from previous technology but serve similar functions so it will certainly give us more rapidly gain customer acceptance. So early entrance will not create any problem in this case.
➢ For our new proposed technology though we need new network establishment and new handset, NokiaSiemens & Ericson already came up with their resources to ensure smooth implementation and operation. Samsung, HTC and other mobile manufacturing company already started to manufacture LTE enable handset. So our concerns about enabling technologies no longer exist.
➢ For our new product there is no need of complementary goods and if needed it can be easily produce or develop in-house or by outsourcing. So this factor will not affect our product to enter the market in early ages.
➢ As our proposed technology & features proves to be valuable, other company will attracted to the market very soon. Thus, if entry barriers are low, the market could quickly become quite competitive, and entering a market that has already become highly competitive can be much more challenging than entering an emerging market.
➢ As there is no threat of dominant design right now in the market we do not have any trouble in this factor also.
➢ Our proposed technology and features already experienced the bulk of the expenses and risk of developing and introducing this technology therefore our concern will be less in terms of withstand with early losses.
➢ As we have well enough resources we can easily speed up technology diffusion and make early entry more attractive.
➢ As company reputation will not be a factor for us although we can
establish a new product brand like Samsung did by named their Smart
Phone as Galaxy.
By considering all those factors and our strategy we reach this decision that we should introduce our new product as early as possible.
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6. Collaboration
Collaboration with other companies can be very beneficial for small and medium sized companies. It can make new resources available and also the expertise in technologies can be shared and used by both parties. It can reduce costs in R&D and manufacturing; reduce time by speeding up various processes and potentially increasing quality.
Collaborations are becoming more and more popular, especially in hard times like now, where the economy still hasn’t recovered from the recession and many of the companies which have been hit are still struggling to recover. Many of those decide to take a different approach to their traditional strategies. That is why we can see big names like T-Mobile & Orange, Microsoft & Nokia, etc., joining forces. There are lots of examples all ranging in the success they had. However, it must be noted that some have also moved in the opposite direction and decided to break up their partnership, like Sony and Ericsson for example.
For our company, we believe that collaboration can indeed bring some fresh wind and be of a huge advantage. One of the potential companies which we believe can deliver this is OnLive.
OnLive is a cloud gaming platform with over 50 gaming publishers. All major games publishers are present with their most popular games. Because of 4G, the new gaming experience will be taken to the next level, as demanding graphical games can be played on handsets that don’t need expensive hardware, but only a fast Internet connection.
Our main focus nevertheless is 4G technologies but we want to promote that feature with the use of OnLive, which when both combined will revolutionise mobile gaming.
Since Cloud gaming has huge potential and so far only exit for PCs and tablets. With us introducing it into the mobile phone market, we can have a leading edge over our competitors.
As far as we know, no other company has such collaboration, partly because both OnLive and Cloud gaming are relatively new, and it also targets a large market with a vast potential (i.e. gamers).
Other collaboration ideas could be with Samsung. Even though Samsung does have their own mobile phone bestsellers in the form of the Galaxy range, they may be interested in investments to their LTE-technology. Samsung was one of the first to explore LTE technologies and even created some early modem type devices. If we can work out a deal with Samsung where we can provide resources and investment for the right to use the LTE technology and the share the fruits of the outcome of our joint R&D, we could both benefit from the joint venture. We all know LTE will replace 3G (or what’s there of 3G) very soon, so a solid foundation in 4G technologies is fundamental in both companies interests.
Another possible collaboration could be a joint venture with a network operator. In the past HTC did that with T-Mobile with the T-Mobil G1 and also more
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recently Apple had a deal with O2 in the UK. In Apple’s case however, it was more of a marketing and promotional strategy, which allowed O2 to be the sole seller of the IPhone 3G for a year across the UK. In our case it would be more like the T-mobile and HTC partnership.
A network operator, as for example one of the 3 major players of the US (Sprint, Verizon or AT&T), which already have adapted LTE technology, can be of huge benefit to our company. Their expertise in this field can result in a lot of time and money being saved as well as improving the technology from the point of what is available now. If our next product can be a sort of flagship for LTE-Advanced for that network operator, both parties will profit especially from the promotional side. Google’s Nexus periodically releases its flagships at certain milestones, such as the Nexus One for its Android 2.3 Gingerbread or the Nexus Galaxy for
2.4 Ice-Cream Sandwich.
7. Competencies & Suggestions
The enhanced recent growth in mobile technologies poses a great threat to the company's success. We could guarantee the future success of our firm by achieving dominance in the marketplace which is only possible through effective product innovation strategies.
∙ Having facilities not only located widely in various geographic regions but technologically the most advanced ones i.e. USA, CHINA and ITALY etc. provides the company with one of the major competitive advantage.
∙ Being a medium sized multinational firm the company has to face budget constraints as well, this poses to be the major disadvantage in our competency as compared to other competitors who despite of being the same sized firms can manage budgets easily because of fewer facilities to manage.
∙ One of the major disadvantages could be lack of market demand for our newly launched products. This would immensely affect our firm economically as it would disrupt the demand supply ratio of our production. Hence creation of market demand is another aspect to be focused on. A strategy that we would work on is ‘demand based service’. For instance, In America Apple’s 3G enabled iPhone could not earn respect because of the shift of some of the major telecom operators to 4G and US Cellular saying it's not interested in an iPhone until there is an LTE (Long Term Evolution) model. These operators include AT & T, Verizon Wireless and Sprint. Our ‘demand based service’ strategy would cater for this need specifically. Our immediate plan is to concentrate and
dedicate all our resources in the development of LTE enabled phones.
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The entry into the market with LTE enabled phones would not only shake the world of telecommunication but would be a great surprize for our competitors. Even huge companies like Apple or Samsung would then be competing with us where it should have been the other way round.
∙ On the other hand budget constraints may prevent the company from embarking a large scale marketing campaign while other competitors may have ability to strongly market their product because of large funding.
∙ Moreover our core competencies like teamwork, leadership, efficient management, effective labour etc. also provide us with competitive advantages. Labour could be outsourced where cheap. For all the new facilities and related resources which of course include human and machinery, a country like India or China may be considered. Cheap labour, both skilled and unskilled, would be further beneficial for the company.
∙ Efficient marketing techniques applied through widely distributed marketing offices in various diverse parts of world would provide us advantage over other competitors’ abilities to market their product in these regions.
∙ Introducing latest technology alone will not be innovative unless new added features are introduced to make our new products different from those of competitors. Wireless technology in a better looking hand set will be preferred therefore product appearance needs to be focused on too. For example Apple, an organisation that experienced fierce competition within the mobile sales market, developed the IPhone. The difference of this product from others within their range gave the corporation a completely new marketplace, which enabled them to create a significant competitive advantage.
∙ Mass production is another advantage. This could be achieved through in-house manufacturing.
∙ Better assembly plants and research centres provide us with a competitive advantage. Efficient research and engineering work will help us introduce the latest technologies like wireless internet etc. in a more innovative fashion.
∙ Being a medium sized firm with limited budget we have the ability to focus on a specific product or technology hence specialize more in some newly introduced innovative product line just like R.I.M deals with a particular product called blackberry(R) and therefore enjoys worldwide brand
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recognition or the Near Field Communication (NFC) technology that is being used by the modern mobile phones. The NFC feature has to be included with a plan to develop and become founders of the holographic display with our mobile phone device. This will be a great attraction for all types of clients. A single mobile handset could be used for all the documentation and preparation of any sort of presentations or display. Our primary focus would be to let free our customer from the fuss of using laptops and projectors while trying to develop a good gaming experience for those who love and live with the heavy non-portable gaming consoles. This could be achieved by the EA cloud gaming concept discussed earlier.
∙ New innovative products need to be segmented properly as well. This segmentation could be done by dividing the target market in various groups based on demographics like age gender etc. latest innovative technology when introduced in a funky mobile handset, will attract a lot of teenage customers.
∙ New products could be launched under a new brand name. The already existing reputation of our firm could be an advantage through which the brand image of our new innovative product line would improve.
8. Expected Growth
To find out about the expected growth we need to emphasise first on the major technology we are focusing on: LTE. The following analysis will give an idea of that. The following table shows the current status of global subscriber statistics on different technologies.
Global Subscriber Statistics (at present)
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“3GPP wireless technologies passed the 5 billion connection mark in the second quarter of 2011, marking a significant milestone in the telecommunications and Internet technology industries. “Analysts and leading industry companies have predicted a future world of connected devices that could reach up to 50 billion by 2020, a world where all things are connected," in the words of Chris Pearson, President of 4G Americas.
According to the GSA report published on the 29th of July, 2011, 45 manufacturers have announced 161 LTE-enabled user devices, representing a
155% growth in the number of products in early February 2011. [1]
Long-Term Evolution (LTE) mobile broadband technology is set for a surge in growth over the next four years, according to new research from In- Stat. Between now and 2015, the number of people signed up for the next- generation service will increase by 3,400 per cent, the market intelligence firm claimed. So this is quite obvious that 4G and devices related to 4G will have a high growth as predicted by the analysts. [2]
After its initial launch in 2010, NFC-enabled smartphones will contribute to 28 per cent of total smartphone sales to end users (250 million units) by 2015, according to a new report from Pyramid Research. "These sales will be driven by the overwhelming supply of NFC-enabled smartphones that will hit the market in the next two years, as well as service providers' 'push' marketing strategies across the globe," she indicates.[3]
So it gives a good indication of the device we are recommending with NFC enabled features, which will have an excellent growth in the future. Another important point is the growing demand for internet usage. A report shows Eastern Europe, India and South Asia are all experiencing massive growth in Internet traffic, according to new figures released by TeleGeography, rising
100% or more in the last 12 months. Even for those living without the basic necessities of life, the draw of information on demand is great, says Helen Leggatt [4].
As we are focusing on the high speed internet services along with online gaming we can assume that the growth and demand of our product will be higher.
9. Recommendation
We already mentioned the future dominant technologies like WiMAX, LTE or LTE-Advanced. As some of the expected features were not fulfilled in the LTE or WiMAX for 4th generation technology, the LTE-Advanced and WiMAX- Advanced were introduced with some modification and advancement. This is why we recommend the LTE-Advanced or WiMAX-Advanced to follow up as the effective technology. Between LTE-Advanced and WiMAX-Advanced, we are
proposing and recommending taking LTE-Advanced. Although WiMAX is a 4G
technology, it could not give expected performance level as it was promised. On
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the other hand LTE, or rather LTE-Advanced is having the capability to sustain longer and fulfil the high speed data transfer as required. Moreover, with faster processors and faster carrier service (not to mention faster Wi-Fi), gamers will be able to connect for an experience that involves high-resolution graphics and faster networks and more widely available connections for anytime gaming with anyone.
In terms of the timing of entry, now is the right time to start research on the product as the world of telecommunication is heading towards the most advanced and improved technology LTE-Advanced.
Out of the possible partnerships, we recommend that our company should collaborate with two of the ones mentioned in Section 5 (Collaborations) in particular. One of them is a major Network provider, the other being OnLive. Just like the nexus phones have been the flagships of the Android OS (Nexus One for 2.3 Gingerbread and Nexus Galaxy for 2.4 Ice-Cream Sandwich), we could produce a handset that symbolises the future of 4G mobile internet, with the first handset using LTE-Advanced.
As we are proposing the device with high capacity and advanced features we should target the high end of the market.
10. Reference
1.
2.
3.
4.
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