Chile Case Study

Executive summary Raising smartphone estimates Forecasting smartphones based on TCO Linking our TCO analysis to the addressable market Smartphone volumes to grow at CAGR of 26% Price point work also shows 1.1bn units long term Significant growth being seen in the low end A specific growth opportunity within China LTE could be a game changer Improving device availability LTE speeds could drive new services Coverage expansion of LTE networks Aggressive rollout plans in US and China An upgrade cycle like none before A war of ecosystems….. Apple – the iOS and Mac ecosystem Google/Android – a one trick pony? Windows 8 – what about the upgrade cycle? Developer dynamics are critical Smartphone economics Carriers have seen margin pressure Smartphone economics What can carriers do? Smartphones – winners and losers Apple scope for share gains exist on multiple fronts Samsung – a strong second Nokia – heading for third position in smartphones Multiple Android vendors may struggle HTC – still bleeding share Motorola Mobility/Google – losing steam in the US Sony – change of

Since the 1990’s, Chile’s economy has flourished almost effortlessly. Overcoming many of the problems it was faced with, Chile has “earned a reputation for being the best-managed economy in Latin America” (Flannery). The country was able to efficiently rebuild the economy in 2011-2012 after the financial crisis put a dent in growth and “increased the GDP by roughly 8.4 percent” (COHA). Chileans attribute much of their success to copper sales, with them being the “leading producer of the metal in the world” (COHA) and a majority of their economy relying on copper prices. However, while progress has slowed in recent years it does not explain the gradual resolving poverty rate in Chile. Chile’s poverty level does not correlate accordingly to its booming economy. In comparison to developing countries like Peru, ranked fourteenth for population below poverty line, Chile is only ranked twelfth but is number one in GDP for Latin America versus Peru’s ranking at eight

From the point of view of economy freedom, Chile’s score is 78.7 (2014 Index of Economic Freedom Chile, 2014). This makes Chile’s economy the 7th free economy in the index of 2014. The total ranking is a bit lower than previous year. There is a change, to be more precise it’s a positive change in the investing figures of Chile. Chile is considered at a very high position with regards to its economic freedom in Southern and the Central parts of America. Chile’s economy has been constantly considered as one of the most freely run economies in its 20 year old history of index. It has also been successful in achieving economic freedom, which is highly impressive at 70. There are 10 economic freedom concepts, out of which three have been successful in gaining a score of 20 points or above since 1995.

Economic changes over the last decade in the telecommunication market and the global networking of the industries have led to an serious transformation process within the whole sector. The previous western monopoly position has given way to an international oligopoly. Increasing competitive intensity and a continuous pressure for innovations have all contributed to decreasing gross profit margins and high cost pressure in the ICT market.

Firstly recorded in the report of the National Telecommunications and Information Administration (NTIA) survey in 1995, (Servon, 2002), the term Digital Divide presents an interesting quandary of information and communication technologies (ICT) disparities among countries in the world, especially between developed and developing countries. Many reports even showed that access to ICT in these information “have” and “have-nots” countries was unequally even (Bridges.org, 2001; Fuchs & Horak, 2008; Norris, 2001 ; Van Dijk, 2009). Nonetheless, though inequities in access to ICT are most evident across countries, the same pattern is found within the countries themselves. In the U.S, for example, the gap in ICT access does exist

Archibugi & Pietrobelli (2002) posit that there are three categories or ways to globalize innovative activities and technologies. First, though the international exploitation of nationally produced technology. In this category, innovators aim “to obtain economic advantages by exploiting their technological competencies in markets other than the domestic one” (p. 865). These economic advantages are obtained through the exportation of innovative goods, the transfer of know-how to foreign firms, and the foreign production of innovative goods internally generated. Second, through the global generation of innovations. This category includes only innovations produced by multinational enterprises since it requires the existence of international but intra-firm R&D labs and technical centers. The global generation of innovations is achieved by developing R&D and

The telecommunications industry is divided into four primary categories; mobile telephones, fixed line telephones, internet and broadband and broadcasting. I am going to center this essay on the mobile telephone sector. I will assess the attractiveness of the mobile telecommunication industry in 1980, analyse meteor’s strategy on entering the market and the reasons that caused it to change them. Lastly I will discuss how I imagine the telecommunications industry will evolve over the next 5 years.

The challenges that will face by the telecommunication industry can be identified as technology challenges, supply & demand market, government regulations, tight liquidity position and scarcity of skilled workforce are the major industry growth challenger. But increasing budget allocation, effective management, positive trend in telecommunication sector, new technological advancements, high investments made by private companies are the drivers providing the industry with competitive advantage.

The economic impacts attempt to find out the effects of ICTs on the economy through technological and non-technological innovations in a country. It also considers the number of patent applications that impact on the development of ICTs based new products, processes and organizational models. It also estimates that overall the economy is shifting towards more knowledge intensive rampage. In modern age, mobile phones can impact economic development in many ways that brings a huge chance to reduce the costs of communication by reducing cost of information searching. Mobile phone is one of the important components in developing countries where needs of the people differs from people to people (Unwin, 2009). Waverman, Meschi and Fuss (2005) note that “mobile phones substitute for fixed lines in poor countries,” and that “mobile telephony has a positive and significant impact on economic growth.” Bedia (1999) also suggested that use of dependable information technology reduces the information transmitting cost among the people for that reason information technology supply curve is shifting to the right.

Deloitte tried to find the relationship between mobile data usage and GDP per capita growth. The study studied the endogeneity of teledensity and mobile data usage by using their own lags. The study used 14 countries data – Brazil, China, Germany, Italy, Korea, Russia, UK, Canada, France, India, Japan, Mexico, South Africa and USA. The results was if countries doubled their consumption of mobile data per 3G connection between the year 2005 and 2010, they would experience a growth rate of 0.5 percentage points higher GDP each year.

However, proponents argue that “the new telecommunication technologies are the electronic highways of the informational age, equivalent to the role played by railway systems in the process of industrialization” (Henderson and Castells 1987:6 as cited by Dicken 2007:83) implying that IT indeed is in the process of reaching maturity but that there are still gaps where the advances in IT have not been exploited fully. “The time-space convergence process is geographically uneven”(Dicken, 2007:83) since two thirds of all registered domain names are in just three countries (US, Germany, UK). Therefore IT services are far from being globally available which implies that even if IT-based solutions are reaching homogeneity in developed parts of the world, for underdeveloped ones IT can still be looked upon as a source of competitive advantage if implemented adequately.

The cellular phone service industry is changing by means of technology breakthroughs with smartphones and adapting new network plans to work. The cell phone industry is fairly fluid at the moment, there’s no risk of the

The Mobile telecommunication industry in this country has increased tremendously within the past couple of years, and have increasingly played major roles in not only the lives of the people within the community in which they are situated but also in the total economic well being of the country as a whole through their social responsibility activities.

Innovation in ICT and its impact on the society has been astounding. It is considered to be “crucial for economic activity” (Jorgenson and Vu, 2007) as it not only “increases productivity and boost economic growth,” (Jorgenson et al, 2008) but “generates complementary innovations that improve economies ' total factor productivity.” (Ceccobelli et al, 2012)

In this paper we have analyzed this mobile telecom industry on the basis of its customer, competitors, industry perspectives, environmental