SWOT Analysis on Jio

Strength
1. Low tariff: - Company has launched its 4G service with highly competitive or
rather very low tariff. Company has strong financial capacity to withstand initial
losses
2. Very wide network:-Company has created wide national network with a huge
investment of around $20 billon. The company has used latest technology and
hence capable to give quality service.
3. Brand Name: - Brand Value of company is very high.
Weakness
1. Late entry into telecommunication sector: - The telecom sector had grown
exponencially in its initial phases which started around two decades earlier.
Presently market has seen only modest growth and it has become highly
competitive due to entry big players such as Vodafone, Idea etc.
2. Operation of Mobile Number Portability Still not smooth:- Nowadays mobile
number has become identity of a person and hence it is difficult for anyone to
change his mobile number.MNP takes many days for its implementation and it is
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hard to manage this transition period. MNP is crucial for Jio as a large number of
customers is expected through migration from existing service providers.
3. Highly dependent upon data consumption: - As per the current trend around
60 to 70 percent of revenue comes from voice calling and hence there is a huge
potential loss for making voice calling free. This loss can be offset only when
consumption of data increases manifold.
Opportunity
1. Large scale availability of smart phones: In last 2 decades the number of
people using Smartphone has increased manifolds. If company is able to provide
quality service at competitive rate it can quickly grab large number of customers.
2. Increasing rate of data consumption: In its earlier phase almost entire revenue
of the mobile service provider was from voice calling. However since last two
years the proportion of revenue from data users is increasing exponentially which
has resulted in almost 30-40% of the total revenue. Lower data tariff may further
increase data consumption and thus contribute more to the revenue of company.
3. International market:-There is huge opportunity in many developing countries
Threat
1. Saturated market: - The initial phase of rapid increase in subscriber is now over.
A new entrant like Jio needs a large customer base to cross breakeven point.
2. Highly competitive market:- After the entry of big players like Vodafone, Idea
etc. the market has become highly competitive.
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3. Changing Government Policy: The changing government policy like cancelling
of 2G licences ,imposition of tax with retrospective effect(on Vodafone), refund
for call drop etc. has created uncertainty in the market causing adverse impact
on the investment sentiment.
4. Rapid upgradation in Technology:- From 2G to 3G and 3G to 4G changes
have occurred in very short span of time. Even next generation 5G is
approaching shortly. Each upgradation requires huge investment and it is not
possible to remain in market without it.
SWOT Analysis on Airtel
Strengths
Bharti Airtel has more than 254 million customers (July 2016). It is the largest
cellular provider in India, and also supplies broadband and telephone services -
as well as many other telecommunications services to both domestic and
corporate customers.
Other stakeholders in Bharti Airtel include Sony-Ericsson, Nokia - and Sing Tel,
with whom they hold a strategic alliance. This means that the business has
access to knowledge and technology from other parts of the telecommunications
world.
The company has covered the entire Indian nation with its network. This has
underpinned its large and rising customer base
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Weaknesses
An often cited original weakness is that when the business was started by Sunil
Bharti Mittal over 30 years ago, the business has little knowledge and experience
of how a cellular telephone system actually worked. So the start-up business had
to outsource to industry experts in the field.
Until recently Airtel did not own its own towers, which was a particular strength of
some of its competitors such as Hutchison Essar. Towers are important if your
company wishes to provide wide coverage nationally.
The fact that the Airtel has not pulled off a deal with South Africa's MTN could
signal the lack of any real emerging market investment opportunity for the
business once the Indian market has become mature.
Opportunities
The company possesses a customized version of the Google search engine
which will enhance broadband services to customers. The tie-up with Google can
only enhance the Airtel brand, and also provides advertising opportunities in
Indian for Google.
Global telecommunications and new technology brands see Airtel as a key
strategic player in the Indian market. The new iPhone will be launched in India
via an Airtel distributorship. Another strategic partnership is held with BlackBerry
Wireless Solutions.
Despite being forced to outsource much of its technical operations in the early
days, this allowed Airtel to work from its own blank sheet of paper, and to
question industry approaches and practices - for example replacing the
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Revenue-Per-Customer model with a Revenue-Per-Minute model which is better
suited to India, as the company moved into small and remote villages and towns.
The company is investing in its operation in 120,000 to 160,000 small villages
every year. It sees that less well-off consumers may only be able to afford a few
tens of Rupees per call, and also so that the business benefits are scalable -
using its 'Matchbox' strategy.
Bharti Airtel is embarking on another joint venture with Jio Essar and Reliance
GSM Cellular to create a new independent tower company called Indus Towers.
This new business will control more than 60% of India's network towers. IPTV is
another potential new service that could underpin the company's long-term
strategy.
Threats
Jio & Airtel seem to be having an on/off relationship. Jio which owned a 13.5%
stake in the Airtel business sold it back to Airtel, and instead invested in its rival
Hutchison Essar. Knowledge and technology previously available to Airtel now
moves into the hands of one of its competitors.
The quickly changing pace of the global telecommunications industry could tempt
Airtel to go along the acquisition trail which may make it vulnerable if the world
goes into recession. Perhaps this was an impact upon the decision not to
proceed with talks about the potential purchase of South Africa's MTN in May
2016. This opened the door for talks between Reliance Communication's Anil
Ambani and MTN, allowing a competing Indian industrialist to invest in the new
emerging African telecommunications market.
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Bharti Airtel could also be the target for the takeover vision of other global
telecommunications players that wish to move into the Indian market.
Airtel comes to you from Bharti Airtel Limited, India's largest integrated and the first
private telecom services provider with a footprint in all the 23 telecom circles. Bharti
Airtel since its inception has been at the forefront of technology and has steered the
course of the telecom sector in the country with its world class products and
services.
The businesses at Bharti Airtel have been structured into three individual strategic
business units (SBU's) - Mobile Services, Airtel Telemedia services and Enterprise
Services.