Cell Phone Industry Analysis

If they are able to maintain the loyalty of most of their current customers, the companies will then have a shared amount of about 100 million customers. This potential customer volume for the merging companies would greatly outnumber the customer volume of the industry leaders, AT&T and Verizon. This kind of turnout would create greater competition between the two merging companies and the two leading companies (Sprint Wireless News, 2014). Although the outcomes seem promising for Sprint and T-Mobile, there are also potential negative effects of a merger that the companies should take into consideration. Current Sprint and T-Mobile customers have expressed their fear of the possible merger for multiple reasons. The two biggest worries for telecommunication services consumers is the potential for rising costs and a reduction in provider options (John, 2016). In making a final decision, the companies, as well as the Federal Communications Commission, should weigh the advantages and disadvantages of a

The generation of talking face-to-face is slowly fading away, and the technology era is going to keep on growing. One of the most widely used technology services known today is the cellular phone industry. According to the Pew Research Center’s website, 90% of American adults own a cell phone. Of that 90%, the smartphone ownership is at 64% (2013). Verizon Wireless, along with the other major carriers, T-Mobile, Sprint, and AT&T, have taken this data and comprised a growing industry where competition arises from all angles. These companies have battled one another on pricing, plans, and customer service for many years in order to stay on top. Unfortunately, these are major factors in whether or not a customer will choose the particular company over another.

In the present day, most people have cell phones. It is also true that most people have a negative experience with a cell phone company imposing early termination fees. When people activate their cell service, they are forces to enter a binding contract for one to two years. If the customer agrees to the contract they will be obligated to pay the whole contract term or they will be assessed the early termination fee. However, the days of cell phone contracts early termination fees are beginning to change.

Last week, Verizon Communications Inc sold off about a quarter of its wireline telephone and Internet operations (WSJ). The company sold its assets to Frontier Communication Corp, a regional telephone company, for $10.5 billion, and the deal leaded Verizon to exit the wireline phone service market in Texas, California and Florida. Also, in order to withdraw from the local wireline phone service market completely, Verizon left millions of FiOS customers who the company spent around $23 billion and 10 years to develop. These customers are roughly 1.6 million fewer FiOS internet subscribers who are about 24% of the company’s total, and around 1.2 million fewer FiOS video customers who are about

I recall several years ago, when I was shopping for a new cell phone plan, to transfer my phone service and phone lines. A co-worker had mentioned several new things she loved about her plan with T-Mobile (2017). The word-of-mouth (WOM) reference I received was a good starting point, yet, did not fully sway me to contract with T-Mobile. Several promotions added to my final decision, however, the offer to have the biggest impact for my decision was a $25 discount on my plan every month just for being a government worker, which was very attractive, and stood out. Therefore, I purchase the plan and switch over, along with purchased two new phones on credit.

AT&T is one of the most successful phone company in United State; however, this articles show how the company do not always give what they promote. In September 2015, an AT&T employee called out the company’s retention practices. She explained how the manager “accidentally” miss accounting errors, so customers have to stick with their products. This a 17 years veteran employee who called the company a catastrophe. She explained in an article published in “The Dallas Morning News” that they are told to retain customer after the promotion expire and sell more promotions or products to these people. Moreover, she said “in most of the case, a customer’s bill will jump up $83 after the intro pricing

"On the page, Simplexity explains that it passes commissions it receives from cellphone network operators on to consumers and why it must recover the commissions if consumers cancel service." (Dscount Cellphone sites com with double dose of terminations fee, hassles, 2012) The cellphones are sold to consumers at a discount with a

This consumer segment has their specific needs that are not being met by the mobile service providers.

The source of customer dissatisfaction in the cell service industry stems from lack of customer focus by the major carriers. The basis of the cell service industry is gaining customers through long-term contract commitments fraught with confusing parameters. The contracts are not written from the perspective of the customer, rather they are written to insure customer commitment for a period of time. Once the customer is committed to a carrier, terms of the contract are inflexible. For example, if a customer exceeds allotted minutes one month but doesn't reach the minutes allotted the following month, the customer is charged for the overage and is not reimbursed for the minutes not used. This is an example of the supplier's gain at the expense of the customer's loss. The major carriers don't have a clear understanding of the customer's needs. If they don't understand the customers needs

This Market Essay is based on the cellular service provider market. The current United States cell phone market is made up of four major providers: Verizon, AT&T, Sprint and TMobile. This market is a perfect example of an Oligopoly, which outlines a small number of sellers in a particular market where serious price competition doesn’t happen. This allows the small number of sellers to collaborate to keep prices high for the consumer. I chose this topic because it is a clear example of how an oligopoly functions in today’s economy, and the impact it has on hundreds of millions of consumers. Cell phones have become one of the most relevant, significant pieces of technology in today’s society. Not only have we become increasingly dependent on these high-tech pieces of hardware in our individual daily lives, but these can also be considered a matter of national defense in which our very safety and well-being potentially be compromised. To own a cellular phone is not enough. The phone has little use to the consumer unless it is attached to consumer provider plan. These carriers do not manufacture the cell phones directly. The providers place their software in the phones that they obtain through the manufacturer suppliers. The cellular contract provided by your carrier activates the phone to towers they have supplied which allows the consumer to then use the device in a typical manner.

In a May, 2005, report Samsung was reported to hold the place for the wireless phone manufacturer whose devices consumers are most likely to purchase during the next 18 to 24 months for four years straight and was reported by the American Customer Satisfaction Index (ACSI) study to be the leader in customer satisfaction among cell phone manufacturers for the second year in a row. (Sprint Users, 2005, p.1)

customers were getting and compare them with the advertised rates by the providers. This will

Various wireless carriers sales departments couldn’t care less about the consumer and only about the dollar on their commission check.

Explosive growth of wireless communications technology continues as the industry experiences new subscribers and lower prices for services. The U.S. market had 100 million wireless subscribers in year 2000, a 16.2 percent rise from 1999 of 86 million. In 1993, there were only 16 million wireless subscribers, a rise of 525 percent rise in subscribers over 7 years. Market penetration rose 33 percent in 2000. In 1993, market penetration was only 6 percent. The explosive growth can largely be attributed to intensive competition which forces prices down and increase cellular phone usage. In fact, the market for wireless voice services is becoming mature. Growth rates and heavy competition are restricting profit margins.

In these three top/major cellular phone companies we can see how economic incentives play a major role on how these companies charge their subscribers. Cost of services paid by subscriber on different bundles of services i.e. basic service/voice, text, minimum charge (either per minute or pulse) are the major factors that these companies that charge consumers. In this study, we will be focusing on the main usage of cellular phones which are the calls and short messaging service (SMS) for local and international usage, prepaid and line subscribers. Through incentives, cost of services subscribed by cellular phone users is minimized and at the same time the benefit of both the consumer and the producer are maximized.