Competitive Landscape of the Telecommunication Services Industry

Investors within the Telecom Service industry obtain equity selection from income, growth
as well as growth and income. Despite the Telco’s capital-intensive nature, advances within the
technology have helped in the improvement of network efficiency. The industry also depends so
much on the issuance of debts. However, partnerships, as well as vendor financing, may relieve
the Telcos from this dependence. Regarding telecom technology, wireline service was the earliest;
which enjoyed monopoly until the government formulated some regulation. Competition from
such alternatives as wireless, Voice over Internet Protocol alongside instant messaging has
compelled companies to do away with wireline services (Value Line Publishing, 2019). Wirelines
have been on the verge of decline, with developing nations embracing the wireless networks,
which are cheap to install. To offset losses, management offer packages in appealing rates.
Furthermore, wireline companies reward investors, maintain operations, pay the debt as well as
the purchase of stock. With high debt ratios, segment consolidation aids in the improvement of
revenue synergies. Cable companies offer a great challenge to the wireline service providers.
Nevertheless, the revenue from wirelines is essential in the expansion of business and debt
management. New technologies alongside services and markets are opportunities that attract
growth investor. Prepaid wireless services play an important role in the expansion of the
telecommunication sector.
Risk Factors
Regarding the telecommunication industry, risk factors are a daily experience, where
telecommunication companies have to deal with the challenges brought by these risks. First, the
exchange rate for the currency. These risks arise from such factors as customer base,
macroeconomic volatility, as well as changes in the market. Impacts of the challenge depend upon
the operations of various markets. Secondly, increased competition. To remain relevant, telecoms
have merged and integrated new technology to compete. The competition results from customer
base saturation, where, all the customers have had to subscribe; thus, companies have to fight for
the same customers. Thirdly is the arrival of new technologies. Such technologies include mobile
payments, cloud computing, among others (U.S Securities Exchange Commission, 2014). To
remain relevant to the new technologies, telecoms have to be creative and find innovative
approaches to the threat of such technologies. Lastly is the access to finance, where expansion
calls for expenditures. Telecoms thus go for short-term and long-term finances for their operations.
With I creased competition, taking financial funding can cause defaulting, which destabilizes the
company. The most common security risk factors for both companies are the issue of foreign
exchange. In this case, the companies face a risk attached to their assets in monetary terms.
General implications for your company of the major changes in risks for your
company between 2012 and today
A change in the risk to this company is evident from the way the operations and
management are currently done. One notable impact of the risk factors is the incorporation of the
new technology. Regarding new technology, companies have had to keep up their service
provision so as remain relevant. Additionally, the changes in foreign exchange patterns have had
an impact on the operations of the company. In this case, the company has to adapt accordingly to
keep their progress on track; otherwise, this would result in losses of the market share as well as
revenue generated. Funding is also another factor that shapes the direction of the
telecommunication company. It is important to note that funding is essential for expansion since
the acquisition of new technology calls for capital investment. Limited access to funding is likely
to cause companies to fall (Yahoo Finance, 2019). Hence, companies should formulate policies
that help in the generation of more revenue, which then aids in expansion. Lastly, si about
competition. Telecommunication companies are at the forefront to ensure that they obtain new
markets by all means. However, this is a huge challenge to companies that do not cope with the
changing patterns. With such competition for customers, a proper strategy for the company would
be to retain the already existing customer base. To do this, the company has to incorporate new
ideas and tailor their services to the interests of the customer. Therefore, customer satisfaction
should come first; that is, the company should consider the satisfaction o the customer to the
generation of profit.
Risks that were common in 2012 and three risks that are common in the most recent
filing
Risks to the technology sector have been in existence for a long period. In 2012, the
challenge was in the arrival of the new technology. The challenge was common to all telecoms.
Every telecom had to find a way to handle this challenge (U.S Securities Exchange Commission,
2014). Most notable was to make an effort of adopting the trends so as that they remain relevant
to the market. The second challenge was the access to financing, where the companies had a
challenge in accessing this much-needed factor for business expansion and acquisition of new
technologies. Thirdly, the competition had a role in the market’s dynamics. The telecoms were in
a rush to obtain many customers, while at the same time maintain the current customers. The
challenge called for innovation to stay relevant. Currently, the challenges still stand; however,
other trends are emerging. First, foreign exchange, as a risk in the market, foreign exchange has
led to market volatility, affecting the market base and thus, can result in the company making
losses. Secondly, new technology. As it was in the year 2012, the same risk still exists. Companies
have to stay updated on current market dynamics. Such calls for investment in the acquisition of
new technology. Lastly, competition from similar service providers. To acquire new markets,
innovation should be encouraged; hence, giving rise to competition. If a company is unable to
compete regarding the current trends, these risks may eventually get rid of them completely.
In your opinion, has the company responded effectively to industry-level changes?
Please explain why
In terms of financial management, the company has had to manage its sources of revenue,
manage their sales, and acquire new technology. The management of finances has led to more
revenue generated (Plunkett Research, Ltd, 2019). Such huge revenue is then used to repay the
accrued debt. With proper financial management, companies have seen an improvement in the
general reduction of risk caused by the challenge. Secondly, the company has also incorporated
new technologies to remain relevant to the market. Such technologies include fast speed internet
and mobile payments. Thirdly, in competition, the company has enhanced its coverage to the entire
market. Thus, ensuring no market gaps which other competitors can venture. By so doing, the
company has been able to maintain its market to the initial customers, thereby keeping track of its
progress.
Importance of this Assignment
This importance of this assignment is that it enables one to learn about the competitive
nature within the different industries that entail service provision (Value Line Publishing, 2019).
It also enables one to review the revenue of the various companies, and the risk that each company
faces. A clear understanding of these challenges is essential in the formulation of relevant policies
that ensure the company remains afloat of the competitive arena. With a comparison of the risks
faced in various years, one can then make a clear follow-up based on the trends, and formulate a
relevant action plan.
 References
Plunkett Research, Ltd. (2019). Plunkett Industry Analytics Reports. Retrieved from
https://www.plunkettresearch.com/plunkett-industry-analytics/
U.S Securities Exchange Commission. (2014, January 15). Filings & Forms. Retrieved from
https://www.sec.gov/edgar.shtml
Value Line Publishing. (2019). Industry Overview: Telecom Services. Retrieved from
http://www.valueline.com/Stocks/Industries/Industry_Overview__Telecom_Services.asp
x#.XTXEsOgzbIU
Yahoo Finance. (2019). Blue Label Telecoms Ltd (BLU.JO) Stock Price, Quote, History & News.
Retrieved from https://finance.yahoo.com/quote/BLU.JO?p=BLU.JO&.tsrc=fin-srch