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A

Project Study Report


On

“STUDY OF STUDENTS PREFERENCE IN SELECTION OF MOBILE


PHONE”

Submitted in partial fulfilment for the


Award of degree of
Master of Business Administration

Submitted By: - Submitted To:-


Seema Saran Mrs. Mamta Soni
MBA 4 sem. MBA FACULTY

2009-11
Global Institute of Technology
RIICO Industrial Area, Sitapura, Jaipur

1
PREFACE

It is a matter of great satisfaction and privilege to present the esteemed


readers this report aimed at finding the Student’s selection criteria towards
various mobile phone brands and handsets.

This project report is a concrete form of the knowledge that was acquired
during the Project Study. During this Study, which is a part of full time two year
Management course, a student gets the opportunity to apply his theoretical
knowledge in the corporate world, in short it emphasizes on ‘Learning By
Doing”. The training paves the way for the student for his successful entrance
in The Mobile Phone Industry.

With the data that was collected from the sample and also the company, I
have tried my best to provide some fruitful suggestions that would be of great
help for the organizations.

This project report is made on the basis of Project Study program


undertaken by me. This report is design to introduce about the Students
preferences and factors which leads selection of Mobile Phone. In this report I
introduce all Mobile Phone Companies in Jaipur.

I anticipate that the suggestions provided would prove to be useful source


of information for all readers and Mobile phone companies, and would facilitate
their growth.

2
ACKNOWLEDGEMENT

I express my sincere thanks to my project guides, Mrs. Mamta Soni, for guiding
me right from the inception till the successful completion of the project.
I sincerely acknowledge her for extending their valuable guidance, support for
literature, critical reviews of project and the report and above all the moral
support he had provided to me with all stages of this project.

I would like to thank RAJASTHAN TECHINICAL UNIVERSITY for giving an


opportunity to work on a valuable project.

Seema Saran
MBA 4th Sem.

3
EXECUTIVE SUMMARY

In today arena the key to success in business is understanding what customers


wants and supplying it more efficiently and more conveniently, not for just
customer satisfaction only but to a level of customer delight . With this as a
premise this project is undertaken and is titled “Study of the Students
preference in selection of mobile phone”. The project aims to understand the
current position of Mobile phone industry vis-à-vis competitors analyzing the
underlying factors for the current position. It then goes on to recommend
certain structural changes and improvements which may be incorporated to
improve on the present position.

• This project is titled project titled “Study of students’ preference in


selection of mobile phone.”

• Projects aim to understand current position of Mobile phone Industry and


areas where improvements are required.

The report recommends suggestion to compete in Global era with other brands
and hold a competitive position in the existing market scenario.

4
DECLARATION

Hereby I declare that the project report entitled “STUDY OF STUDENTS


PREFERENCE IN SELECTION OF MOBILE PHONE” submitted for the degree of
Master of Business Administration, is my original work and the project report has not
formed the basis for the award of any diploma, degree, associate ship, fellowship or
similar other titles. It has not been submitted to any other university or institution for the
award of any degree or diploma.

Seema Saran
` MBA- 4th Sem.

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TABLE OF CONTENTS

Chapter
No. Chapter Name

DECLARATION
CERTIFICATE
PREFACE
ACKNOWLEDGEMNT
EXECUTIVE SUMMERY

1. INTRODUCTION TO THE INDUSTRY 8-30

2. INTRODUCTION TO THE ORGANIZATIONS 31-97

3. RESEARCH METHODOLOGY 99-102

3.1 Title of the study

3.2 Duration of the project

3.3 Objective of study

3.4 Type of Research

3.5 Sample size and method of selecting sample

3.6 Scope of study

3.7 Limitations ofstudy

4. FACTS AND FINDINGS 103-107

5. ANALYSIS AND INTERPRETATION 108-119

6. SWOT Analysis 120-121

7. CONCLUSION 122

8. RECOMMENDATIO AND SUGGESTIONS 123

9. APPENDIX 124-125

10. BIBLIOGRAPHY 126

1. INTRODUCTION TO THE INDUSTRY


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1.1 Introduction

The Indian telecommunications industry is one of the fastest growing in the


world and India is projected to become the second largest telecom market
globally by 2010.

India added 113.26 million new customers in 2008, the largest globally. In fact,
in April 2008, India had already overtaken the US as the second largest
wireless market. To put this growth into perspective, the country’s cellular base
witnessed close to 50 per cent growth in 2008, with an average 9.5 million
customers added every month. According to the Telecom Regulatory Authority
of India (TRAI), the total number of telephone connections (mobile as well as
fixed) had touched 385 million as of December 2008, taking the telecom
penetration to over 33 per cent. This means that one out of every three Indians
has a telephone connection, and telecom companies expect this pace of
growth to continue in 2009 as well. "We are extremely bullish that the growth
will continue in 2009. This year, the number of additions will be in excess of
130 million," according to T.V. Ramachandran , Director General, Cellular
Operators Association of India (COAI), an industry body that represents all
Global System for Mobile communications (GSM) players in India.

According to CRISIL Research estimates, eight infrastructure sectors, which


include the telecom sector, are expected to draw more than US$ 345.28 billion
investment in India by 2012.

With the rural India growth story unfolding, the telecom sector is likely to see
tremendous growth in India's rural and semi-urban areas in the years to come.
By 2012, India is likely to have 200 million rural telecom connections at a
penetration rate of 25 per cent. And according to a report jointly released by
Confederation of Indian Industry (CII) and Ernst & Young, by 2012, rural users
will account for over 60 per cent of the total telecom subscriber base.

According to Business Monitor International, India is currently adding 8-10


million mobile subscribers every month. It is estimated that by mid 2012,
around half the country's population will own a mobile phone. This would

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translate into 612 million mobile subscribers, accounting for a tele-density of
around 51 per cent by 2012.

It is projected that the industry will generate revenues worth US$ 43 billion in
2009-10.

The telecom services have been recognized the world-over as an important


tool for socio-economic development for a nation. It is one of the prime support
services needed for rapid growth and modernization of various sectors of the
economy. Indian telecommunication sector has undergone a major process of
transformation through significant policy reforms, particularly beginning with the
announcement of NTP 1994 and was subsequently re-emphasized and carried
forward under NTP 1999. Driven by various policy initiatives, the Indian telecom
sector witnessed a complete transformation in the last decade. It has achieved
a phenomenal growth during the last few years and is poised to take a big leap
in the future also.

1.2 Status of Telecom Sector

The Indian Telecommunications network with 353 million connections (as on


September 2008) is the third largest in the world. The sector is growing at a
speed of 46-50% during the recent years. This rapid growth is possible due to
various proactive and positive decisions of the Government and contribution of
both by the public and the private sectors. The rapid strides in the telecom
sector have been facilitated by liberal policies of the Government that provides
easy market access for telecom equipment and a fair regulatory framework for
offering telecom services to the Indian consumers at affordable prices. The
Government has taken following main initiatives for the growth of the Telecom
Sector:

Indian Telecom Statistics

8
Indian Telecom Statistics (April 2010)
Total telephone subscriber
413.47
base
Over all Tele-density 35.62

37.73 Total Subscriber


base in April 2010
Fixed-line user base

Wireless user 375.74


base (GSM+CDMA+WLL(F))
GSM Subscribers 277.12
CDMA Subscribers 98.62
Monthly new additions
13.42
(Wireline + Wireless)
Monthly new additions
13.44
(Wireless)
Broadband subscribers 5.85

(Subscriber numbers is in million)

Total GSM subscriber base reached 277.12 million

Service Provider
Subscriber (Mn) Market Share (%)
Name
Bharti Airtel 91.11 32.88%
Vodafone Essar 65.92 23.79%
BSNL 44.18 15.94%
IDEA 41.52 14.98%
Aircel 17.48 6.31%
Reliance Telecom 10.74 3.88%
MTNL 4.08 1.47%
BPL 2.07 0.75%
All India 277.12 100.00%

Total CDMA subscriber base reached 98.62 million

Service Provider
Subscriber (Mn) Market Share (%)
Name
Reliance Com 58.50 59.32
Tata Teleservices 33.87 34.34
BSNL 5.06 5.13

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Sistema Shyam 0.50 0.51
HFCL Infotel 0.39 0.40
MTNL 0.29 0.29
All India 98.62 100.00%

Source: TRAI & AUSPI

The country has 375.74 million mobile subscribers in total.


(Feb 2009)

Subscribers
Rank Operator Technology Ownership
(in millions)

91.1 [62] (Feb


1 Airtel GSM, EDGE Bharti Tele-Ventures
2009)

CdmaOne 69.64 [63] (Feb Reliance - Anil Dhirubhai


2 Reliance
GSM 2009) Ambani Group

65.92 [64] (Feb Vodafone (67%) & Essar


3 Vodafone GSM, EDGE
2009) Group (33%)

GSM, GPRS, 49.25 [65] (Feb


4 BSNL State-owned
EDGE,HSDPA 2009)

Idea 37.47 [66] (Feb


5 GSM, GPRS, EDGE Aditya Birla Group
Cellular 2009)

Tata 33.87 [67] (Feb


6 CdmaOne Tata Group
Indicom 2009)

17.1 [68] (Feb Maxis Communications &


7 Aircel GSM
2009) Apollo Hospital

8 MTNL GSM,HSDPA 4.38 [69] (Feb State-owned

10
2009)

3.80 [70] Spice Corp and Telekom


9 Spice GSM
(December 2008) Malaysia

LOOP 1.94 [71]


10 GSM, GPRS Essar Group
Mobile (December 2008)

0.38 [72]
11 ping mobile GSM HFCL Infotel
(December 2008)

0.36 [73] Sistema (73.71%) & Shyam


12 MTS cdma
(December 2008) Group (23.79%)

1.3 Growth in Segments

According to a Frost & Sullivan industry analyst, by 2012, fixed line revenues
are expected to touch US$ 12.2 billion while mobile revenues will reach US$
39.8 billion in India. Fixed line capex is projected to be US$ 3.2 billion, and
mobile capex is likely to touch US$ 9.4 billion.

Further, according to a report by Gartner Inc., India is likely to remain the


world's second largest wireless market after China in terms of mobile
connections. According to recent data released by the COAI, Indian telecom
operators added a total of 10.66 million wireless subscribers in December

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2008. Further, the total wireless subscriber base stood at 346.89 million at the
end of December 2008.

The overall cellular services revenue in India is projected to grow at a CAGR of


18 per cent from 2008-2012 to exceed US$ 37 billion. Cellular market
penetration will rise to 60.7 per cent from 19.8 per cent in 2007.

The Indian telecommunications industry is on a growth trajectory with the GSM


operators adding a record 9.3 million new subscribers in January 2009, taking
the total user base to 267.5 million, according to the data released by COAI.
However, this figure does not include the number of subscribers added by
Reliance Telecom.

In WiMax, India is slated to become the largest WiMAX market in the Asia-
Pacific by 2013. A recent study sees India's WiMAX subscriber base hitting 14
million by 2013 and growing annually at nearly 130 per cent. And investments
in WiMAX ventures are slated to top US$ 500 million in India, according to a
report by US-based research and consulting firm, Strategy Analytics.

1.4 Value-Added Services Market

A report by market research firm IMRB stated that the mobile value-added
services (MVAS) industry was valued at US$ 1.15 billion in June 2008, and is
expected to grow rapidly at 70 per cent to touch US$ 1.96 billion by June 2009.

Currently, MVAS in India accounts for 10 per cent of the operator's revenue,
which is expected to reach 18 per cent by 2010. According to a study by
Stanford University and consulting firm BDA, the Indian MVAS is poised to
touch US$ 2.74 billion by 2010.

12
Mobile advertising, which is an important VAS segment, offers great potential to
become an important revenue source. Marketers are increasingly using MVAS
as a step ahead of SMS-based marketing to sell soaps and shampoos,
banking, insurance products and also entertainment services, and rural
markets are proving to be very receptive for such marketing.

Further, Venture Capitalists like Canaan Partners, Draper Fisher Juvertson,


Helion, and Nexus India are also innovating with services like mobile payment
options, advertising, voice-based SMS and satellite video streaming.

According to Venture Intelligence, there were nine deals worth US$ 41 million
in 2007 in the mobile VAS space, and till August 2008, seven deals worth US$
91 million had already been finalized. Presently, mobile VAS has a US$ 700
million market with a 20 per cent y-o-y growth, which is likely to touch US$ 3
billion by 2012.

1.5 Major Investments

The booming domestic telecom market has been attracting huge amounts of
investment which is likely to accelerate with the entry of new players and
launch of new services.

Buoyed by the rapid surge in the subscriber base, huge investments are being
made into this industry.

• Norway-based telecom operator Telenor has bought a 60 per cent stake


in Unitech Wireless for US$ 1.23 billion.
• Japanese telecom major NTT DoCoMo has acquired a 27.31 per cent
equity capital of Tata Teleservices for about US$ 2.6 billion and a 20.25
per cent stake in Tata Teleservices (Maharashtra) Ltd for about US$
190.23 million.
• Singapore Telecommunications (SingTel), which has a 31 per cent stake
in Bharti Airtel, has received the government’s approval to offer long
distance services in India, according to a communication ministry official.

13
• Mauritius-based P5 Asia Holding Investments (Mauritius) Ltd will be
investing around US$ 545.13 million to hold a 20 per cent stake in Aditya
Birla Telecom Ltd (ABTL). The funds will be utilized for network rollout
and operations of ABTL in the Bihar circle.
• Bharat Sanchar Nigam Ltd (BSNL) is planning an investment of around
US$ 201.5 million in the Tamil Nadu Circle for an additional 23 lakh
mobile connections under both 2G and 3G technologies by 2009.
• The latest to join the world's second largest telecom market is Bahrain's
Batelco which has signed a deal to buy 49 per cent in Chennai-based S-
Tel, a GSM service provider, for $225 million.
• Etisalat, a Gulf-based telecommunications company has picked up a 45
per cent stake in Swan Telecom.
• Kavveri Telecom Products Limited is planning to set up a new subsidiary
- Kavveri Telecom Infrastructure Limited (KTIL) - with an investment of
US$ 20.11 million over the next two years, to offer in-building telecom
infrastructure to telecom service providers.
• Juniper Networks, which is the second-largest maker of networking
equipment, plans to invest US$ 400 million in India, over the next five
years, with a focus on its research and development (R&D) activity.
• BSNL, India's leading telecom company in revenue terms, will put in
about US$ 1.16 billion in its WiMax project.
• Bharti Airtel will be spending US$ 2.5 billion in a major expansion bid.
• Reliance Communication has committed US$ 5.69 billion as capital
investment for the fiscal year ending March 2009.
• Idea Cellular will spend about US$ 2.36 billion in the fiscal ending March
2009.
• Srei Group's Quippo Telecom Infrastructure Ltd (QTIL) plans to invest
US$ 3 billion in 2008-09 to ramp up its telecom infrastructure business to
grow both organically and inorganically.
• Vodafone Essar will invest US$ 6 billion over the next three years in a
bid to increase its mobile subscriber base from 40 million at present to
over 100 million.
• Telecom service provider, Tata Teleservices Limited, has announced
that the company will be investing additional US$ 6.74 million in Gujarat
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to set up 100 cell sites by August 2009. The company had earlier made
an announcement of investing US$ 24.1 million in the state till March
2009.
• Telecom operator Aircel, which launched GSM mobile services in
Bangalore on February 23, 2009, plans to invest US$ 220.58 million
over the next year to set up base stations across the state.

1.6 Liberalization

The process of liberalization in the country began in the right earnest with the
announcement of the New Economic Policy in July 1991. Telecom equipment
manufacturing was delicensed in 1991 and value added services were declared
open to the private sector in 1992, following which radio paging, cellular mobile
and other value added services were opened gradually to the private sector.
This has resulted in large number of manufacturing units been set up in the
country. As a result most of the equipment used in telecom area is being
manufactured within the country. A major breakthrough was the clear
enunciation of the government’s intention of liberalizing the telecom sector in
the National Telecom Policy resolution of 13th May 1994.

1.7 National Telecom Policy 1994

In 1994, the Government announced the National Telecom Policy which


defined certain important objectives, including availability of telephone on
demand, provision of world class services at reasonable prices, improving
India’s competitiveness in global market and promoting exports, attractive FDI
and stimulating domestic investment, ensuring India’s emergence as major
manufacturing / export base of telecom equipment and universal availability of
basic telecom services to all villages. It also announced a series of specific
targets to be achieved by 1997.

1.8 Telecom Regulatory Authority of India (TRAI)

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The entry of private service providers brought with it the inevitable need for
independent regulation. The Telecom Regulatory Authority of India (TRAI) was,
thus, established with effect from 20th February 1997 by an Act of Parliament,
called the Telecom Regulatory Authority of India Act, 1997, to regulate telecom
services, including fixation/revision of tariffs for telecom services which were
earlier vested in the Central Government.

TRAI’s mission is to create and nurture conditions for growth of


telecommunications in the country in manner and at a pace, which will enable
India to play a leading role in emerging global information society. One of the
main objectives of TRAI is to provide a fair and transparent policy environment,
which promotes a level playing field and facilitates fair competition. In
pursuance of above objective TRAI has issued from time to time a large
number of regulations, orders and directives to deal with issues coming before
it and provided the required direction to the evolution of Indian telecom market
from a Government owned monopoly to a multi operator multi service open
competitive market. The directions, orders and regulations issued cover a wide
range of subjects including tariff, interconnection and quality of service as well
as governance of the Authority.

The TRAI Act was amended by an ordinance, effective from 24 January 2000,
establishing a Telecommunications Dispute Settlement and Appellate Tribunal
(TDSAT) to take over the adjudicatory and disputes functions from TRAI.
TDSAT was set up to adjudicate any dispute between a licensor and a
licensee, between two or more service providers, between a service provider
and a group of consumers, and to hear and dispose of appeals against any
direction, decision or order of TRAI.

1.9 New Telecom Policy 1999

The most important milestone and instrument of telecom reforms in India is the
New Telecom Policy 1999 (NTP 99). The New Telecom Policy, 1999 (NTP-99)
was approved on 26th March 1999, to become effective from 1st April 1999.

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NTP-99 laid down a clear roadmap for future reforms, contemplating the
opening up of all the segments of the telecom sector for private sector
participation. It clearly recognized the need for strengthening the regulatory
regime as well as restructuring the departmental telecom services to that of a
public sector corporation so as to separate the licensing and policy functions of
the Government from that of being an operator. It also recognized the need for
resolving the prevailing problems faced by the operators so as to restore their
confidence and improve the investment climate.

Key features of the NTP 99 include:

 Strengthening of Regulator.

 National long distance services opened to private operators.

 International Long Distance Services opened to private sectors.

 Private telecom operators licensed on a revenue sharing basis, plus a one-


time entry fee. Resolution of problems of existing operators envisaged.

 Direct interconnectivity and sharing of network with other telecom


Operators within the service area were permitted.

 Department of Telecommunication Services (DTS) corporatised in 2001.

 Spectrum Management made transparent and more efficient.

All the commitments made under NTP 99 have been fulfilled, each one of them,
in letter and spirit, some even ahead of schedule, and the reform process is
now complete with all the sectors in telecommunications opened for private
competition.

1.10 Broadband Policy 2004

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Recognizing the potential of ubiquitous Broadband service in growth of GDP
and enhancement in quality of life through societal applications including tele-
education, tele-medicine, e-governance, entertainment as well as employment
generation by way of high-speed access to information and web based
communication; Government has announced Broadband Policy in October
2004. The main emphasis is on the creation of infrastructure through various
technologies that can contribute to the growth of broadband services. These
technologies include optical fibre, Asymmetric Digital Subscriber Lines (ADSL),
cable TV network; DTH etc. Broadband connectivity has been defined as
“Always On” with the minimum speed of 256 kbps. It is estimated that the
number of broadband subscribers would be 9 million by 2007 and 20 million by
2010. With a view to encourage Broadband Connectivity, both outdoor and
indoor usage of low power Wi-Fi and Wi-Max systems in 2.4 GHz-2.4835 GHz
band has been delicensed. The use of low power indoor systems in 5.15-5.35
GHz and 5.725-5.875 GHz bands has also been delicensed in January 05.
The SACFA/WPC clearance has been simplified. The setting up of National
Internet Exchange of India (NIXI) would enable bringing down the international
bandwidth cost substantially, thus making the broadband connectivity more
affordable.

The prime considerations guiding the Policy includes affordability and


reliability of Broadband services, incentives for creation of additional
infrastructure, employment opportunities, induction of latest technologies,
national security and bring in competitive environment so as to reduce
regulatory interventions.

By this new policy, the Government intends to make available transponder


capacity for VSAT services at competitive rates after taking into consideration
the security requirements. The service providers permitted to enter into
franchisee agreement with cable TV network operators. However, the Licensee
shall be responsible for compliance of the terms and conditions of the licence.
Further in the case of DTH services, the service providers permitted to provide
Receive-Only-Internet Service. The role of other facilitators such as electricity
authorities, Departments of ITs of various State Governments, Departments of
18
Local Self Governments, Panchayats, Departments of Health and Family
Welfare, Departments of Education is very important to carry the advantage of
broadband services to the users particularly in rural areas.

The Year 2007 was declared the year of broadband. Target has been set for
20 million broadband connections by 2010 and providing Broadband
connectivity to all secondary and higher secondary schools, public health
institutions and panchayats by 2008.

In rural areas, connectivity of 512 KBPS with ADSL 2 plus technology (on
wire) will be provided from about 20,000 existing exchanges in rural areas
having optical fibre connectivity. Community Service Centres, secondary
schools, banks, health centres, Panchayats, police stations etc. can be
provided with this connectivity in the vicinity of above-mentioned 20,000
exchanges in rural areas. DOT will be subsidizing the infrastructure cost of
Broadband network through support from USO Fund to ensure that Broadband
services are available to users at affordable tariffs.

Policy Initiatives

The government has taken many proactive initiatives to facilitate the rapid
growth of the Indian telecom industry.

• The Cabinet Committee on Economic Affairs (CCEA) has adopted new


guidelines for computation of foreign equity holding in Indian companies.
The new norm is expected to allow companies in a sector like telecom to
raise the extent of foreign investment. The new norms will benefit all
such companies that have touched their foreign direct investment ceiling
and part of the investment is through an Indian company owned and
controlled by resident Indians. "All investments directly by a non-resident
entity into an Indian company will be counted as foreign in-vestment,
while foreign investment through an investing Indian company will not be
considered for calculation of the indirect foreign investment, in case the
Indian company is owned and controlled by resident Indian citizens,"
according to Home Minister Mr. P Chidambaram.
19
• 100 per cent foreign direct investment (FDI) is permitted through the
automatic route in telecom equipment manufacturing.
• FDI ceiling in telecom services has been raised to 74 per cent.
• Introduction of a unified access licensing regime for telecom services on
a pan-India basis.
• Introduction of mobile number portability in a phased manner, starting in
the fourth quarter of 2008.
• The government is implementing a program of connecting 66,822
uncovered villages under the Bharat Nirman programme. The
government will invest US$ 2 billion to set up 1.12 lakh community
service centres in rural India to provide broadband connectivity in 2008-
09.
• The Finance Ministry has declared a five-fold (from US$ 100 million to
US$ 500 million) increase in the external commercial borrowings
amount, which companies involved in infrastructure sectors can borrow
from overseas to spend in India.
• In another move, the Department of Telecommunications (DoT) has
stated that foreign telecom companies can bid for 3G spectrum without
partnering with Indian companies. Only after winning a bid, would they
need to apply for unified access service licence (UASL) and partner with
an Indian company in accordance with the FDI regulations.
• Further, the Reserve Bank of India (RBI) has eased its mobile-banking
norms, by raising the caps on fund transfers as well as mobile-based
payments, and increasing the transaction limit to US$ 96.81 per day for
fund transfers.
• The Department of Telecom has allowed passive infrastructure sharing
among operators, which includes sharing of physical sites, buildings,
shelters, towers, power supply and battery backup. In early 2008, it also
allowed sharing of active infrastructure but it has been limited to
antenna, feeder cable, node B, radio access network and transmission
systems and not sharing of spectrum.

1.11 Mobile Technology

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1.11.1 GSM Technology

GSM is a technology which is the leading cell phone standard all over the
world. In 1982 it was recognized as a standard for digital wireless
communications and was first adopted in Europe and then by Asia, Africa etc.
The first system was online in 1991 and GSM was formerly known as Group
Special Mobile but now stands for Global System for Mobile communications.
USA, however has not adopted GSM as a standard and so different carriers
now use different technologies as opposed to only GSM.

GSM uses digital technology and the methods of time division multiple access
transmission. In GSM, sound is digitally prearranged through a special
encoder, which imitates the distinctiveness of human speech. This method of
transmission allows a very competent statistics speed/information content ratio.

GSM is an open system and is a non propriety technology. One of the great
benefits of GSM is that it facilitates international roaming. As it is adopted by
more than 170 countries, you have the facility of using your GSM cell phone in
all these places without having to change your number. GSM satellite roaming
has broadened the scope of cellular services even to areas where standard
terrestrial services are not possible.

GSM is a technology that is rapidly growing and constantly evolving with


wireless, satellite and cordless systems offering greatly expanded services.
These services include multimedia data services, high speed, inbuilt support for
side by side use of these services and faultless incorporation with the Internet
and wireline networks. 3GSM (next generation of mobile communications
services) is already charted out and will make available services enhancing the
already existing voice, data, and text services. GSM will provide video on
demand and will help to lessen the gap between wireless and
internet/computers.

GSM works on different frequency bands across the world. In North America it
uses a 1900 MHz frequency whereas in other parts of the world it uses either
900MHz or 1800 MHz. As different frequencies are used in different places,

21
your GSM handset should support various bands so that it can be used
globally.

From the beginning, GSM has been developed with the need to give its
customers utmost security in terms of secure communications, fraud
prevention, and call privacy. Today it is the worlds most secure public wireless
standard for cellular phones.

1.11.2 Code division multiple access Technology (CDMA)

Code division multiple access (CDMA) is a channel access method utilized


by various radio communication technologies. It should not be confused with
the mobile phone standards called cdmaOne and CDMA2000 (which are often
referred to as simply "CDMA"), which use CDMA as an underlying channel
access method.

One of the basic concepts in data communication is the idea of allowing several
transmitters to send information simultaneously over a single communication
channel. This allows several users to share a bandwidth of frequencies. This
concept is called multiplexing. CDMA employs spread-spectrum technology
and a special coding scheme (where each transmitter is assigned a code) to
allow multiple users to be multiplexed over the same physical channel. By
contrast, time division multiple access (TDMA) divides access by time, while
frequency-division multiple access (FDMA) divides it by frequency. CDMA is a
form of "spread-spectrum" signaling, since the modulated coded signal has a
much higher data bandwidth than the data being communicated.

An analogy to the problem of multiple access is a room (channel) in which


people wish to communicate with each other. To avoid confusion, people could
take turns speaking (time division), speak at different pitches (frequency
division), or speak in different languages (code division). CDMA is analogous to
the last example where people speaking the same language can understand

22
each other, but not other people. Similarly, in radio CDMA, each group of users
is given a shared code. Many codes occupy the same channel, but only users
associated with a particular code can understand each other.

Uses

A CDMA mobile phone

• One of the early applications for code division multiplexing—predating,


and distinct from cdmaOne—is in GPS.

• The Qualcomm standard IS-95, marketed as cdmaOne.

• The Qualcomm standard IS-2000, known as CDMA2000. This standard


is used by several mobile phone companies, including the Globalstar
satellite phone network.

• CDMA has been used in the OmniTRACS satellite system for


transportation logistics.

What are the Difference between GSM and CDMA?

In cellular service there are two main competing network technologies: Global
System for Mobile Communications (GSM) and Code Division Multiple Access
(CDMA). Cellular carriers including Sprint PCS, Cingular Wireless, Verizon and

23
T-Mobile use one or the other. Understanding the difference between GSM and
CDMA will allow you to choose a carrier that uses the preferable network
technology for your needs.

The GSM Association is an international organization founded in 1987,


dedicated to providing, developing, and overseeing the worldwide wireless
standard of GSM. CDMA, a proprietary standard designed by Qualcomm in the
United States, has been the dominant network standard for North America and
parts of Asia. However, GSM networks continue to make inroads in the United
States, as CDMA networks make progress in other parts of the world. There
are camps on both sides that firmly believe either GSM or CDMA architecture is
superior to the other. That said, to the non-invested consumer who simply
wants bottom line information to make a choice, the following considerations
may be helpful.

Coverage: The most important factor is getting service in the areas you will be
using your phone. Upon viewing competitors' coverage maps you may discover
that only GSM or CDMA carriers offer cellular service in your area. If so, there
is no decision to be made, but most people will find that they do have a choice.
Data Transfer Speed: With the advent of cellular phones doing double and
triple duty as streaming video devices, podcast receivers and email devices,
speed is important to those who use the phone for more than making calls.
CDMA has been traditionally faster than GSM, though both technologies
continue to rapidly leapfrog along this path. Both boast "3G" standards, or 3rd
generation technologies.

EVDO, also known as CDMA2000, is CDMA's answer to the need for speed
with a downstream rate of about 2 megabits per second, though some reports
suggest real world speeds are closer to 300-700 kilobits per second (kbps).
This is comparable to basic DSL. As of fall 2005, EVDO is in the process of
being deployed. It is not available everywhere and requires a phone that is
CDMA2000 ready.
GSM's answer is EDGE (Enhanced Data Rates for GSM Evolution), which
boasts data rates of up to 384 kbps with real world speeds reported closer to
24
70-140 kbps. With added technologies still in the works that include UMTS
(Universal Mobile Telephone Standard) and HSDPA (High Speed Downlink
Packet Access), speeds reportedly increase to about 275—380 kbps. This
technology is also known as W-CDMA, but is incompatible with CDMA
networks. An EDGE-ready phone is required.

In the case of EVDO, theoretical high traffic can degrade speed and
performance, while the EDGE network is more susceptible to interference. Both
require being within close range of a cell to get the best speeds, while
performance decreases with distance.

Subscriber Identity Module (SIM) cards: In the United States only GSM phones
use SIM cards. The removable SIM card allows phones to be instantly
activated, interchanged, swapped out and upgraded, all without carrier
intervention. The SIM itself is tied to the network, rather than the actual phone.
Phones that are card-enabled can be used with any GSM carrier.

The CDMA equivalent, a R-UIM card, is only available in parts of Asia but
remains on the horizon for the U.S. market. CDMA carriers in the U.S. require
proprietary handsets that are linked to one carrier only and are not card-
enabled. To upgrade a CDMA phone, the carrier must deactivate the old phone
then activate the new one. The old phone becomes useless.

Roaming: For the most part, both networks have fairly concentrated coverage
in major cities and along major highways. GSM carriers, however, have
roaming contracts with other GSM carriers, allowing wider coverage of more
rural areas, generally speaking, often without roaming charges to the customer.
CDMA networks may not cover rural areas as well as GSM carriers, and though
they may contract with GSM cells for roaming in more rural areas, the charge to
the customer will generally be significantly higher.

International Roaming: If you need to make calls to other countries, a GSM


carrier can offer international roaming, as GSM networks dominate the world

25
market. If you travel to other countries you can even use your GSM cell phone
abroad, providing it is a quad-band phone (850/900/1800/1900 MHz).
By purchasing a SIM card with minutes and a local number in the country you
are visiting, you can make calls against the card to save yourself international
roaming charges from your carrier back home. CDMA phones that are not card-
enabled do not have this capability, however there are several countries that
use CDMA networks. Check with your CDMA provider for your specific
requirements.

According CDG.org, CDMA networks support over 270 million subscribers


worldwide, while GSM.org tallies up their score at over 1 billion. As CDMA
phones become R-UIM enabled and roaming contracts between networks
improve, integration of the standards might eventually make differences all but
transparent to the consumer.

The chief GSM carriers in the United States are Cingular Wireless, recently
merged with AT&T Wireless, and T-Mobile USA. Major CDMA carriers are
Sprint PCS, Verizon and Virgin Mobile. There are also several smaller cellular
companies on both networks.

1.11.3. 3G Technology

3G is the third generation of telecommunication hardware standards and


general technology for mobile networking, superseding 2.5G. It is based on the
International Telecommunication Union (ITU) family of standards under the
IMT-2000.

3G networks enable network operators to offer users a wider range of more


advanced services while achieving greater network capacity through improved
spectral efficiency. Services include wide-area wireless voice telephone, video
calls, and broadband wireless data, all in a mobile environment. Additional
features also include HSPA data transmission capabilities able to deliver data
rates up to 14.4 Mbit/s on the downlink and 5.8 Mbit/s on the uplink.

26
Unlike IEEE 802.11 networks, which are commonly called Wi-Fi or WLAN
networks, 3G networks are wide-area cellular telephone networks that evolved
to incorporate high-speed Internet access and video telephony. IEEE 802.11
networks are short range, high-bandwidth networks primarily developed for
data.

The first pre-commercial 3G network was launched by NTT DoCoMo in Japan


branded FOMA, in May 2001 on a pre-release of W-CDMA technology. The
first commercial launch of 3G was also by NTT DoCoMo in Japan on October
1, 2001, although it was initially somewhat limited in scope; broader availability
was delayed by apparent concerns over reliability. The second network to go
commercially live was by SK Telecom in South Korea on the 1xEV-DO
technology in January 2002. By May 2002 the second South Korean 3G
network was by KTF on EV-DO and thus the Koreans were the first to see
competition among 3G operators.

The first European pre-commercial network was at the Isle of Man by Manx
Telecom, the operator then owned by British Telecom, and the first commercial
network in Europe was opened for business by Telenor in December 2001 with
no commercial handsets and thus no paying customers. These were both on
the W-CDMA technology.

The first commercial United States 3G network was by Monet Mobile Networks,
on CDMA2000 1x EV-DO technology, but this network provider later shut down
operations. The second 3G network operator in the USA was Verizon Wireless
in October 2003 also on CDMA2000 1x EV-DO, and this network has grown
strongly since then.

The first pre-commercial demonstration network in the southern hemisphere


was built in Adelaide, South Australia by m.Net Corporation in February 2002
using UMTS on 2100 MHz. This was a demonstration network for the 2002 IT
World Congress. The first commercial 3G network was launched by Hutchison
Telecommunications branded as Three in April 2003.

27
In December 2007, 190 3G networks were operating in 40 countries and 154
HSDPA networks were operating in 71 countries, according to the Global
Mobile Suppliers Association (GSA). In Asia, Europe, Canada and the USA,
telecommunication companies use W-CDMA technology with the support of
around 100 terminal designs to operate 3G mobile networks.

In Europe, mass market commercial 3G services were introduced starting in


March 2003 by 3 (Part of Hutchison Whampoa) in the UK and Italy. The
European Union Council suggested that the 3G operators should cover 80% of
the European national populations by the end of 2005.

Roll-out of 3G networks was delayed in some countries by the enormous costs


of additional spectrum licensing fees. In many countries, 3G networks do not
use the same radio frequencies as 2G, so mobile operators must build entirely
new networks and license entirely new frequencies; an exception is the United
States where carriers operate 3G service in the same frequencies as other
services. The license fees in some European countries were particularly high,
bolstered by government auctions of a limited number of licenses and sealed
bid auctions, and initial excitement over 3G's potential. Other delays were due
to the expenses of upgrading equipment for the new systems.

By June 2007 the 200 millionth 3G subscriber had been connected. Out of 3
billion mobile phone subscriptions worldwide this is only 6.7%. In the countries
where 3G was launched first - Japan and South Korea - 3G penetration is over
70%. In Europe the leading country is Italy with a third of its subscribers
migrated to 3G. Other leading countries by 3G migration include UK, Austria,
Australia and Singapore at the 20% migration level. A confusing statistic is
counting CDMA 2000 1x RTT customers as if they were 3G customers. If using
this definition, then the total 3G subscriber base would be 475 million at June
2007 and 15.8% of all subscribers worldwide.

Still several major countries such as Indonesia have not awarded 3G licenses
and customers await 3G services. China delayed its decisions on 3G for many
years. China announced in May 2008, that the telecoms sector was re-
organized and three 3G networks would be allocated so that the largest mobile

28
operator, China Mobile, would retain its GSM customer base. China Unicom
would retain its GSM customer base but relinquish its CDMA2000 customer
base, and launch 3G on the globally leading WCDMA (UMTS) standard. The
CDMA2000 customers of China Unicom would go to China Telecom, which
would then launch 3G on the CDMA 1x EV-DO standard. This meant that
China would have all three main cellular technology 3G standards in
commercial use. Finally in January 2009, Ministry of industry and Information
Technology of China have awarded licenses of all three standards,TD-
SCDMA to China Mobile, WCDMA to China Unicom and CDMA2000 to China
Telecom.

In November 2008, Turkey has auctioned four IMT 2000/UMTS standard 3G


licenses with 45, 40, 35 and 25 MHz top frequencies. Turkcell has won the
45MHz band with its €358 million offer followed by Vodafone and Avea leasing
the 40 and 35MHz frequencies respectively for 20 years. The 25MHz top
frequency license remains to be auctioned.

The first African use of 3G technology was a 3G video call made in


Johannesburg on the Vodacom network in November 2004. The first
commercial launch of 3G in Africa was by EMTEL in Mauritius on the W-CDMA
standard. In north African Morocco in late March 2006, a 3G service was
provided by the new company Wana.

2. INTRODUCTION TO THE ORGANISATIONS

2.1 Nokia

29
Nokia Corporation
Public – Oyj
Type (OMX: NOK1V, NYSE: NOK,
FWB: NOA3)
Tampere, Finland (1865)
Founded
incorporated in Nokia (1871)
Founder(s) Fredrik Idestam
Headquarters Espoo, Finland
Area served Worldwide
Kari Kairamo, CEO in the 1980s
Olli-Pekka Kallasvuo, President &
Key people
CEO
Jorma Ollila, Chairman
Telecommunications
Industry Internet
Computer software
Mobile phones
Smartphones
Products Multimedia computers
Networks
(See products listing)
Services and Software
Services
Online services
Revenue ▼ €50.722 bn (2008)[1][2]
Operating
▼ €4.966 bn (2008)
income
Net income ▼ €3.988 bn (2008)
Total assets ▲ €39.582 bn (2008)
Total equity ▼ €16.510 bn (2008)
128,445 as of December 31,
Employees
2008[3]

30
Devices
Divisions Services
Markets
Nokia Siemens Networks
Navteq
Subsidiaries Symbian
Vertu
Qt Software
Website Nokia.com

Nokia Corporation (pronounced [ˈnɔkiɑ] in Finnish) (OMX: NOK1V,


NYSE: NOK, FWB: NOA3) is a Finnish multinational communications
corporation, headquartered in Keilaniemi, Espoo, a city neighbouring Finland's
capital Helsinki. Nokia is focused on wireless and wired telecommunications,
with 128,445 employees in 120 countries, sales in more than 150 countries and
global annual revenue of EUR 50.7 billion and operating profit of 5.0 billion as
of 2008. It is the world's largest manufacturer of mobile telephones: its global
device market share was about 37% in Q4 2008, down from 40% in Q4 2007
and down from 38% sequentially. Nokia produces mobile phones for every
major market segment and protocol, including GSM, CDMA, and W-CDMA
(UMTS). Nokia's subsidiary Nokia Siemens Networks produces
telecommunications network equipments, solutions and services. Navteq is part
of Nokia's strategy of focusing on mobile navigation.

Nokia has sites for research and development, manufacture and sales in many
continents throughout the world. As of December 2008, Nokia had R&D
presence in 16 countries and employed 39,350 people in research and
development, representing approximately 31% of the group's total workforce.
The Nokia Research Center, founded in 1986, is Nokia's industrial research
unit of about 500 researchers, engineers and scientists. It has sites in seven
countries: Finland, China, India, Kenya, Switzerland, United Kingdom and
United States. Besides its NRCs, in 2001 Nokia founded (and owns) INdT –
Nokia Institute of Technology, a R&D institute located in Brazil. Nokia's
production facilities are located at Espoo, Oulu and Salo, Finland; Manaus,

31
Brazil; Beijing, Dongguan and Suzhou, China; Fleet, England; Komárom,
Hungary; Chennai, India; Reynosa, Mexico; Jucu, Romania and Masan, South
Korea. Nokia's Design Department remains in Salo, Finland.

Nokia is a public limited liability company listed on the Helsinki, Frankfurt, and
New York stock exchanges. Nokia plays a very large role in the economy of
Finland: it is by far the largest Finnish company, accounting for about a third of
the market capitalization of the Helsinki Stock Exchange (OMX Helsinki) as of
2007; a unique situation for an industrialized country. It is an important
employer in Finland and several small companies have grown into large ones
as its partners and subcontractors. Nokia increased Finland's GDP by more
than 1.5% in 1999 alone. In 2004 Nokia's share of the Finland's GDP was 3.5%
and accounted for almost a quarter of Finland's exports in 2003.

Finns have ranked Nokia many times as the best Finnish brand and employer.
The Nokia brand, valued at $35.9 billion, is listed as the fifth most valuable
global brand in Interbrand/BusinessWeek's Best Global Brands list of 2008 (first
non-US company). It is the number one brand in Asia (as of 2007) and Europe
(as of 2008), the 42nd most admirable company worldwide in Fortune's World's
Most Admired Companies list of 2009 (third in Network Communications,
seventh non-US company), and is the world's 88th largest company in Fortune
Global 500 list of 2008, up from 119 of the previous year. As of 2008, AMR
Research ranks Nokia's global supply chain number two in the word.

2.1.1 Pre-telecommunications era

The predecessors of the modern Nokia were Nokia Company (Nokia


Aktiebolag), Finnish Rubber Works Ltd (Suomen Gummitehdas Oy) and
Finnish Cable Works Ltd (Suomen Kaapelitehdas Oy).
Nokia's history starts in 1865 when engineer Fredrik Idestam established a
groundwood pulp mill on the banks of the Tammerkoski rapids in the town of
Tampere, in south-western Finland, and started manufacturing paper. In 1868,
Idestam built a second mill to the town of Nokia, fifteen kilometres (nine miles)

32
west of Tampere by the Nokianvirta river, which had better resources for
hydropower production.[26] That is where the company got the name that it still
uses today. In 1871, Idestam transformed his firm into a share company and
founded Nokia Company with his close friend, statesman Leo Mechelin.

The name of the town, Nokia, originated from the river which flowed through
the town. The river itself, Nokianvirta, was named after the archaic Finnish
word originally meaning a small, dark-furred animal that lived on the banks of
the Nokianvirta river. In modern Finnish, noki means soot and nokia is its
inflected plural, although this form of the word is rarely if ever used. The old
word, nois (pl. nokia) or nokinäätä ("soot marten"), meant sable. After sable
was hunted to extinction in Finland, the word was applied to any dark-furred
animal of the genus Martes, such as the pine marten, which are found in the
area to this day.

At the end of the 19th century, Mechelin's wish to expand into the electricity
business were at first thwarted by Idestam's opposition. Idestam retired from
the management of the company in 1896. Later, Mechelin managed to
convince most shareholders of his plans and became the company chairman
(1898–1914), thus being able to realize his visions. In 1902, Nokia added
electricity generation to its business activities.

2.1.2 Industrial conglomerate

At the beginning of the 20th century, Finnish Rubber Works, manufacturer of


galoshes and other rubber products, established its factories nearby and began
using Nokia as its brand. In the 1910s, shortly after World War I, Nokia
Company was nearing bankruptcy. To ensure the continuation of electricity
supply from Nokia's generators, Finnish Rubber Works acquired the business
of the insolvent company. In 1922, Finnish Rubber Works acquired Finnish
Cable Works, producer of telephone, telegraph and electricity cables. In 1937,
Verner Weckman, a sport wrestler and Finland's first Olympic Gold medallist,
became President of Finnish Cable Works, after 16 years as its Technical

33
Director. After World War II, Finnish Cable Works supplied cables to the Soviet
Union as part of Finland's war reparations. This gave the company a good
foothold for later trade.

The three companies, which had been jointly owned since 1922, were merged
to form a new industrial conglomerate, Nokia Corporation in 1967 and paved
the way for Nokia's future as a global corporation. The new company was
involved in many sectors, producing at one time or another paper products,
bicycle and car tires, footwear (including Wellington boots), personal
computers, communications cables, televisions, electricity generation
machinery, capacitors and aluminium. Each business unit had its own director
who reported to the first Nokia Corporation President, Björn Westerlund. As the
president of Finnish Cable Works, he had been responsible for setting up the
company’s first electronics department in 1960, sowing the seeds of Nokia’s
future in telecommunications.

Eventually, the company decided to leave consumer electronics behind in the


1990s and focused solely on telecommunications. Nokian Tyres, manufacturer
of tires split from Nokia Corporation to form its own company in 1988[36] and
two years later Nokian Footwear, manufacturer of rubber boots, was founded.
During the rest of the 1990s, Nokia divested itself of all of its non-
telecommunications businesses.
2.1.3 Telecommunications era

The seeds of the current incarnation of Nokia were planted with the founding of
the electronics section of the cable division in 1960 and the production of its
first electronic device in 1962: a pulse analyzer designed for use in nuclear
power plants. In the 1967 fusion, that section was separated into its own
division, and began manufacturing telecommunications equipment.

2.1.4 Networking equipment

34
In the 1970s, Nokia became more involved in the telecommunications industry
by developing the Nokia DX200, a digital switch for telephone exchanges. In
1982, a DX200 switch became the world's first digital telephone switch to be
put into operational use. The DX200 became the workhorse of the network
equipment division. Its modular and flexible architecture enabled it to be
developed into various switching products.

For a while in the 1970s, Nokia's network equipment production was separated
into Telefenno, a company jointly owned by the parent corporation and by a
company owned by the Finnish state. In 1987, the state sold its shares to Nokia
and in 1992 the name was changed to Nokia Telecommunications.

2.1.5 Involvement in GSM

Nokia was one of the key developers of GSM (Global System for Mobile
Communications), the second-generation mobile technology which could carry
data as well as voice traffic. NMT (Nordic Mobile Telephony), the world's first
mobile telephony standard that enabled international roaming, provided
valuable experience for Nokia for its close participation in developing GSM,
which was adopted in 1987 as the new European standard for digital mobile
technology.

Nokia delivered its first GSM network to the Finnish operator Radiolinja in 1989.
The world's first commercial GSM call was made on July 1, 1991 in Helsinki,
Finland over a Nokia-supplied network, by then Prime Minister of Finland Harri
Holkeri, using a prototype Nokia GSM phone. In 1992, the first GSM phone, the
Nokia 1011, was launched. The model number refers to its launch date, 10
November. The Nokia 1011 did not yet employ Nokia's characteristic ring tone,
the Nokia tune. It was introduced as a ring tone in 1994 with the Nokia 2100
series.

GSM's high-quality voice calls, easy international roaming and support for new
services like text messaging (SMS) laid the foundations for a worldwide boom
in mobile phone use. GSM came to dominate the world of mobile telephony in
35
the 1990s, in mid-2008 accounting for about three billion mobile telephone
subscribers in the world, with more than 700 mobile operators across 218
countries and territories. New connections are added at the rate of 15 per
second, or 1.3 million per day.

2.1.6 Personal computers

In the 1980s, Nokia's computer division Nokia Data produced a series of


personal computers called MikroMikko was Nokia Data's attempt to enter the
business computer market. The first model in the line, MikroMikko 1, was
released on September 29, 1981, around the same time as the first IBM PC.
However, the personal computer division was sold to the British ICL
(International Computers Limited) in 1991, which later became part of Fujitsu.
MikroMikko remained a trademark of ICL and later Fujitsu. Internationally the
MikroMikko line was marketed by Fujitsu as the ErgoPro.

Fujitsu later transferred its personal computer operations to Fujitsu Siemens


Computers, which shut down its only factory in Espoo, Finland (in the Kilo
district, where computers had been produced since the 1960s) at the end of
March 2000, thus ending large-scale PC manufacturing in the country. Nokia
was also known for producing very high quality CRT displays for PC and larger
systems application. The CRT division was sold to ViewSonic in 2000.

2.1.7 Recent history

This section has multiple issues. Please help improve the article or discuss
these issues on the talk page.
It may be slanted towards recent events. Please edit this page to keep recent
events in historical perspective. Tagged since May 2008.
It may contain an inappropriate mixture of prose and timeline. Tagged since
March 2008.

36
Regression of size in Nokia mobile phones.

Nokia opened its Komárom, Hungary mobile phone factory on May 5, 2000.
In April 2003, the troubles of the networks equipment division caused the
corporation to resort to similar streamlining practices on that side, including
layoffs and organizational restructuring. This diminished Nokia's public image in
Finland, and produced a number of court cases and an episode of a
documentary television show critical of Nokia.

On September 22, 2003, Nokia acquired Sega.com, a branch of Sega which


has been the major basis to develop the Nokia N-Gage device.

On November 16, 2005, Nokia and Intellisync Corporation, a provider of data


and PIM synchronization software, signed a definitive agreement for Nokia to
acquire Intellisync.

Nokia completed the acquisition on February 10, 2006.


Despite these occasional crises, Nokia has been phenomenally successful in
its chosen field. Its growth has come mostly during the era of Jorma Ollila as
CEO and his team of about six close colleagues. In June 2006, Ollila left to
become the chairman of Royal Dutch Shell[72] and to give way for Olli-Pekka
Kallasvuo.

On February 2006, Nokia and Sanyo announced a memorandum of


understanding to create a joint venture addressing the CDMA handset
business. But in June, they announced ending negotiations without agreement.

37
Nokia also stated its decision to pull out of CDMA research and development,
to continue CDMA business in selected markets.

On June 19, 2006, Nokia and Siemens AG announced the companies are to
merge their mobile and fixed-line phone network equipment businesses to
create one of the world's largest network firms, Nokia Siemens Networks. Each
company has a 50% stake in the infrastructure company and it is
headquartered in Espoo, Finland. The companies predict annual sales of €16
bn and cost savings of €1.5 bn a year by 2010. About 20,000 Nokia employees
were transferred to this new company.

The Nokia 6300, a member of the Nokia 6000 series, Nokia's largest family of
phones.

On August 8, 2006, Nokia and Loudeye Corp. announced that they have
signed an agreement for Nokia to acquire online music distributor Loudeye
Corporation for approximately US $60 million. The company has been
developing this into an online music service in the hope of using it to generate
handset sales. The service is expected to launch in late 2007 and would rival
iTunes. Nokia completed the acquisition on October 16, 2006.
In March 2007, Nokia signed a memorandum with Cluj County Council,
Romania to open a new plant near the city in Jucu commune. Moving the
production from the Bochum, Germany factory to a low wage country created
an uproar in Germany.

38
In May 2007, Nokia announced that its Nokia 1100 handset, with over 200
million units shipped, is the best-selling mobile phone of all time and the world's
top-selling consumer electronics product.

In July 2007, Nokia acquired all assets of Twango, the comprehensive media
sharing solution for organizing and sharing photos, videos and other personal
media.

In September 2007, Nokia announced its intention to acquire Enpocket, a


supplier of mobile advertising technology and services.

In October 2007, pending shareholder and regulatory approval, Nokia bought


Navteq, a U.S.-based supplier of digital mapping data, for a price of $8.1 billion.
Nokia finalized the acquistion on July 10, 2008.

In November 2007, Nokia announces and releases the Nokia N82, its first (and
currently, only) Nseries phone with Xenon flash.

At the Nokia World conference in December 2007, Nokia announced their


"Comes With Music" program: Nokia device buyers are to receive a year of
complimentary access to music downloads. The service is expected to be
commercially available in the second half of 2008.

In April 2008, Nokia began finding new ways to connect people, asking the
"audience" to use their creativity and their mobile devices to become Nokia’s
production company – to take part in filming, acting, editing and producing a
collaborative film. Nokia Productions will be the first ever mobile filmmaking
project directed by Spike Lee. This will be a collaborative experience that exists
across borders and perspectives—working off a common script.

In May 2008, Nokia announced on their annual stockholder meeting that they
want to shift to the internet business as a whole. Nokia no longer wants to be
39
seen as the telephone company. Google, Apple and Microsoft are not seen as
natural competition for their new image but they are considered as major
important players to deal with.

In September, 2008, Nokia acquires OZ Communications, a privately held


company with approximately 220 employees and headquartered in Montreal,
Canada.

In 2008, Nokia released the Nokia E71 in the United Kingdom which was
marketed to directly compete with the other Blackberry devices offering a full
keyboard and cheaper prices.

In November 2008, Nokia announced ceasing mobile phone distribution in


Japan.[93] Following early December, distribution of Nokia E71 is cancelled,
both from NTT docomo and SoftBank Mobile. Nokia Japan remains tasks of
global research & development programs, sourcing business, and an MVNO
venture of Vertu luxury phones, using docomo's telecommunication network.

2.1.8 Devices

40
Evolution of the Nokia Communicator. Models 9000, 9110, 9210 and 9500
shown.
The Devices division combines its existing mainline mobile phones division with
the separate subdivisions manufacturing Multimedia (Nseries) and Enterprise
(Eseries) class devices as well as formerly centralized core devices R&D –
called Technology Platforms, headed by Kai Öistämö.

This division provides the general public with mobile voice and data products
across a wide range of mobile devices, including high-volume, consumer
oriented mobile phones and devices, and more expensive multimedia and
enterprise-class devices. The devices are based on GSM/EDGE, 3G/W-CDMA
and CDMA cellular technologies. Nokia's Nseries Multimedia Computers
extensively uses Symbian OS.

In the first quarter of 2006 Nokia sold over 15 million MP3 capable mobile
phones, which means that Nokia is not only the world's leading supplier of
mobile phones and digital cameras (as most of Nokia's mobile telephones
feature digital cameras, it is also believed that Nokia has recently overtaken
Kodak in camera production making it the largest in the world), Nokia is now
also the leading supplier of digital audio players (MP3 players), outpacing sales
of devices such as the iPod from Apple. At the end of the year 2007, Nokia
managed to sell almost 440 million mobile phones which accounted for 40% of
all global mobile phones sales.
2.1.9 Services

The Nokia N95, an example of Nokia's Nseries multimedia computer line-up.


The Services division operates in five areas of Internet services: music, maps,
media, messaging and games. The division combines the existing Enterprise
and Consumer driver services businesses previously hosted in Multimedia and
Enterprise Solutions divisions as well as a number of new acquisitions
(Loudeye, Gate5, Enpocket, Intellisync, Avvenu and OZ Communications),
headed by Niklas Savander.

41
The group works with companies outside the telecommunications industry to
make advances in the technology and bring new applications and possibilities
in areas such as online services, optics, music synchronization and streaming
media.

2.1.10 Subsidiaries

Nokia has several subsidiaries, of which the two most important as of 2009 are
Nokia Siemens Networks and Navteq. Other notable subsidiaries include, but
are not limited to Symbian Limited, a software development and licensing
company that produces Symbian OS, a smart phone operating system used by
Nokia and other manufacturers; Vertu, a British-based manufacturer and
retailer of luxury mobile phones; Qt Software, a Norwegian-based software

42
company, and OZ Communications, a consumer e-mail and instant messaging
provider.

2.1.10.1 Nokia Siemens Network

Nokia Siemens Networks (previously Nokia Networks) provides mobile network


infrastructure, communications and networks service platforms, as well as
professional services to operators and service providers. Networks focuses in:
GSM, EDGE, 3G/W-CDMA and WiMAX radio access networks; core networks
with increasing IP and multi-access capabilities; and services. At the end of
2005, Nokia Networks had more than 150 mobile network customers in more
than 60 countries, with its systems serving in excess of 400 million subscribers.

On June 19, 2006 Nokia and Siemens AG announced the companies are to
merge their mobile and fixed-line phone network equipment businesses to
create one of the world’s largest network firms, called Nokia Siemens
Networks. The Nokia Siemens Networks brand identity was subsequently
launched at the 3GSM World Congress in Barcelona in February 2007.

2.1.10.2. Navteq

Navteq, which was acquired by Nokia on October 1, 2007, is a Chicago, Illinois-


based provider of digital map data for automotive navigation systems, mobile
devices, Internet-based mapping applications and government and business
solutions. Navteq’s map data will be part of the Nokia Maps online service
where users can download maps, use voice-guided navigation and other
context-aware web services.

2.1.11 Corporate governance

The control and management of Nokia is divided among the shareholders at a


general meeting and the Group Executive Board (left), under the direction of
the Board of Directors (right). The Chairman and the rest of the Group

43
Executive Board members are appointed by the Board of Directors. Only the
Chairman of the Group Executive Board can belong to both, the Board of
Directors and the Group Executive Board. The Board of Directors' committees
consist of the Audit Committee, the Personnel Committee and the Corporate
Governance and Nomination Committee.

The operations of the company are managed within the framework set by the
Finnish Companies Act, Nokia's Articles of Association and Corporate
Governance Guidelines, and related Board of Directors adopted charters.

2.1.12 Corporate culture

44
The Nokia House, Nokia's head office in Keilaniemi, Espoo, Finland.
Nokia's official corporate culture manifesto, The Nokia Way, emphasises the
speed and flexibility of decision-making in a flat, networked organization,
although the corporation's size necessarily imposes a certain amount of
bureaucracy.

The official business language of Nokia is English. All documentation is written


in English, and is used in official intra-company spoken communication and e-
mail.

Until May 2007, the Nokia Values were Customer Satisfaction, Respect,
Achievement, and Renewal. In May 2007, Nokia redefined its values after
initiating a series of discussions worldwide as to what the new values of the
company should be. Based on the employee suggestions, the new values were
defined as: Engaging You, Achieving Together, Passion for Innovation and
Very Human.

2.1.13 Online services

2.1.13.1 Mobi and the Mobile Web

Nokia was the first proponent of a Top Level Domain (TLD) specifically for the
Mobile Web and, as a result, was instrumental in the launch of the .mobi
domain name extension in September 2006 as an official backer. Since then,
Nokia has launched the largest mobile portal, Nokia.mobi, which receives over

45
100 million visits a month. It followed that with the launch of a mobile Ad
Service to cater to the growing demand for mobile advertisement.

2.1.13.2 Ovi

Nokia Ovi logo.

Ovi, announced on August 29, 2007, is the name for Nokia's "umbrella
concept" Internet services. Centered on Ovi.com, it will market as "personal
dashboard" where users can share photos with friends, download music, maps
and games directly to their phones and access third-party services like Yahoo's
Flickr photo site. It has some significance in that Nokia is moving deeper into
the world of Internet services, where head-on competition with Microsoft,
Google and Apple is inevitable.

The services so far announced to be offered through Ovi include the Nokia
Music Store, Nokia Maps and the N-Gage mobile gaming platform available for
several S60 smartphones.

2.1.13.3 MOSH

In August 2007, Nokia launched their new social network, dubbed MOSH.
MOSH by Nokia is the first-ever social network built by a handset manufacturer.
MOSH aims to bring social, media-based networks to the mobile environment.
Users can upload, download, share, and bookmark a variety of media – audio
files, video files, documents, applications, games, images.

46
2.1.13.4 Comes With Music

On December 4, 2007, Nokia unveiled their plans for the "Nokia Comes With
Music" initiative, a program that would partner with Universal Music Group
International and Sony BMG to bundle a year's worth of unlimited, DRM-
encumbered downloads with the purchase of a Nokia phone. Following the
termination of the year of free downloads, tracks can be kept without having to
renew the subscription. Downloads will be both PC and mobile-based.

2.1.13.5 Nokia Messaging

On August 13, 2008, Nokia launched a beta release of "Nokia Email service", a
new push e-mail service, since graduated as part of Nokia Messaging. Nokia
Messaging can sync personal e-mail accounts offered by a variety of ISPs
(Internet Service Providers). Nokia Messaging is available at email.nokia.com.

2.1.14 Environmental record

Electronic products such as cell phones impact the environment both during
production and after their useful life when they are discarded and turned into
electronic waste. According to environmental organization Greenpeace, Nokia
has a good track record in limiting the amount of toxic chemicals in its products,
supporting recycling, and reducing impact on climate change, compared to
other large electronics brands.

In an effort to further reduce their environmental impact, Nokia released a new


phone concept, Remade, in February 2008.The phone has been constructed of
solely recyclable materials. The outer part of the phone is made from recycled
materials such as aluminium cans, plastic bottles, and used car tires. The
screen is constructed of recycled glass, and the hinges have been created from

47
rubber tires. The interior of the phone is entirely constructed with refurbished
phone parts, and there is a feature that encourages energy saving habits by
reducing the backlight to the ideal level, which then allows the battery to last
longer without frequent charges.

2.1.15 Research cooperation with universities

Nokia is actively exploring and engaging in open innovation through selective


research collaborations with major universities and institutions by sharing
resources and leveraging ideas. Current collaborations include:[

École Polytechnique Fédérale de Lausanne, Switzerland

ETH Zurich, Switzerland

Helsinki University of Technology, Finland

Massachusetts Institute of Technology, United States

Stanford University, United States

Tampere University of Technology, Finland

Tsinghua University, China

University of Cambridge, United Kingdom

2.2 Sony Ericsson

48
Type Joint venture
Founded 3 October 2001
Head Office:
London, United Kingdom
Headquarters
Incorporated:
Sweden

Nelson Mozol (President) Anders Runevad


Key people
(EVP) Carl-Henric Svanberg (Chairman)

Industry Telecommunications
Mobile phones
Mobile music devices
Wireless systems
Products
Wireless voice devices
Hi-Tech accessories
Wireless data devices
Revenue ▼ €11,244 million (2008)[1]
Net income ▼ -€73 million (2008)
Employees 9,400 (as of July 2008)
Sony Corporation (50%)
Parent
Ericsson AB (50%)
Website http://www.sonyericsson.com/

Sony Ericsson is a joint venture established on October 3, 2001 by the


Japanese consumer electronics company Sony Corporation and the Swedish
telecommunications company Ericsson to make mobile phones. The stated
reason for this venture is to combine Sony's consumer electronics expertise
with Ericsson's technological leadership in the communications sector. Both
companies have stopped making their own mobile phones.

49
The company's global management is based in Hammersmith, London, and it
has research & development teams in Sweden, Japan, China, Germany,
the United States, India, Pakistan and the United Kingdom. By 2008, it
was the fifth-largest mobile phone manufacturer in the world after Nokia,
Samsung, LG and Motorola. The sales of products largely increased due
to the launch of the Walkman and Cyber-shot series.

2.2.1 Recent performance

While Sony Ericsson has been enjoying strong growth recently, its South
Korean rival LG Electronics overtook it in Q1 2008 due to the company's profits
falling significantly by 43% to €133 million (approx. US$ 179.6697 million [2]),
sales falling by 8% and market share dropping from 9.4% to 7.9%, despite
favourable conditions that the handset market is expected to grow by 10% in
2008. Sony Ericsson announced another profit warning in June 2008[3] and saw
net profit crash by 97% in Q2 2008, announcing that it would cut 2,000 jobs,
leading to wide fear that Sony Ericsson is on the verge of decline along with its
struggling rival, Motorola.[4] In Q3 the profits were much on the same level,
however November and December saw increased profits along with new
models being released such as the C905 being one of the top sellers across
the United Kingdom.

Sony Ericsson has, as of July 18, 2008, approximately 9,400 employees and
2,500 contractors worldwide. Hideki Komiyama is the president of the company
and has been since November 1, 2007 when he replaced Miles Flint. The
Corporate Executive Vice President is Anders Runevad.

2.2.2 History

2.2.2.1 Troubles in Ericsson's mobile phone business

In the United States, Ericsson partnered with General Electric in the early
nineties, primarily to establish a US presence and brand recognition.

50
Ericsson had decided to source on chips for its phones from a single source, a
Philips facility in New Mexico. In March 2000, a fire at the Philips factory
contaminated the sterile facility. Philips assured Ericsson and Nokia (the other
major customer of the facility) that production would be delayed by less than a
week. When it became clear that production would actually be compromised for
months, Ericsson was faced with a serious shortage. Nokia had already begun
to obtain parts from alternative sources, but Ericsson's position was much
worse as both production of current models and the launch of new ones was
held up.

Ericsson, which had been in the cellular phone market for decades and was the
world no. 3 cellular telephone handset maker was struggling with huge losses
in spite of booming sales since 2000 due to this fire and its inability to produce
cheaper phones like its competitor Nokia. To curtail the losses, it was thinking
of outsourcing production to Asian companies that can produce the handset for
lower costs.

Speculation had begun about a possible sale by Ericsson of its mobile phone
division but the company's president said that it had no plans to do that. "Mobile
phones are really a core business for Ericsson. We wouldn't be as successful
(in networks) if we didn't have phones", he said.

2.2.2.2 Background of the joint venture

Sony was a marginal player in the worldwide cell phone market with a share of
less than 1 percent in 2000. It was also struggling in this area with losses but
wanted to focus more in this area. In April 2001, Sony confirmed that it was in
talks with Ericsson for a possible collaboration in the handset business. This
51
was soon after Toshiba and Siemens had announced plans in November 2000
to work together on handsets for 3G mobile networks, which was cancelled in
2001.

By August 2001, the two companies had finalized the terms of the merger
announced in April. The company was to have an initial workforce of 3,500
employees.

2.2.2.3 Early troubles

In spite of having aimed to be profitable in its very first year, Ericsson's market
share actually fell and in August 2002, Ericsson said it would stop making
mobile phones and end its partnership with Sony if the business continues to
disappoint even as Sony said it was fully committed to the joint venture and
wanted to make it a success. However, in January 2003, both companies said
they would inject more money into the joint venture in a bid to stem the losses.

Sony Ericsson's strategy was to release new models capable of digital


photography as well as other multimedia capabilities such as downloading and
viewing video clips and personal information management capabilities. To this
end, it released several new models which had built-in digital camera and color
screen which were novelties at that time. The high-end P800 which featured a
built-in camera and PDA attributes was successful and helped in turning
around. The joint venture, however, continued to make bigger losses in spite of
booming sales. Thus, it kept postponing its target date for making a profit from
its first year to 2002 to 2003 to second half of 2003.

It even failed in its mission of becoming the top seller of multimedia handsets
and was in fifth-place and struggling in 2003.

2.2.2.4 Turnaround

Beginning of the turnaround

In June 2003, Sony Ericsson said it will stop making CDMA cellphones for the
US market and will focus on GSM which was and remains the dominant

52
technology. It also slashed jobs in research and development in USA and
Germany. In October 2003, it posted its first quarterly profit but warned that
falling prices on phones and competition would make it difficult to stay in black.
Sony Ericsson's recovery is credited to the success of the T610 model.

Following the success of its P800 phone, Sony Ericsson introduced the P900 at
simultaneous events in Las Vegas and Beijing in October 2003. It was pegged
as smaller, faster, simpler and more flexible than its predecessor.

In March 2004, Ericsson said it would try to block its rival Nokia from gaining
control of Symbian, an industry consortium that makes operating software for
smart phones.

In 2004, Sony Ericsson's market share increased from 5.6 percent in the first
quarter to 7 percent in the second quarter. In July 2004, Sony Ericsson
unveiled the P910 communicator with its integrated thumbboard, broad e-mail
support, quadruple memory and improved screen.

In February 2005, Sony Ericsson president Miles Flint announced at the 3GSM
World Congress that Sony Ericsson will unveil a mobile phone-come-digital
music player in the next month. It would be called the Walkman phone and
would play music file formats such as MP3 and AAC.

Success with Walkman phones and beyond

On March 1, 2005, Sony Ericsson introduced the K750i with a 2 megapixel


camera, as well as its platform mate, the W800i, the first of the highly
successful Walkman phones capable of doing 30 hours of music playback and
two low-end phones.

On May 1, 2005, Sony Ericsson agreed to become the global title sponsor for
the WTA Tour in a deal worth 88 million US dollars over 6 years. The women's
pro tennis circuit was renamed the Sony Ericsson WTA Tour. Just over a month
later on June 7, it announced sponsorship of West Indian batsmen Chris Gayle
and Ramnaresh Sarwan.

53
In October 2005, Sony Ericsson presented the first mobile phone based on UIQ
3, the P990.

On January 2, 2007, Sony Ericsson announced in Stockholm that it will be


having some of its mobile phones produced in India. It announced that its two
outsourcing partners, Lextronic and Foxconn will be producing 10 million
cellphones per year by 2009. CEO Miles Flint announced at a press conference
held with India's communications minister Dayanidhi Maran in Chennai that
India was one of the fastest growing markets in the world and a priority market
for Sony Ericsson with 105 million users of GSM mobile telephones.

On February 2, 2007, Sony Ericsson acquired UIQ Technology, a Swedish


software company from Symbian Ltd.. UIQ will remain an independent
company, Miles Flint announced.[6]

On October 15, 2007, Sony Ericsson announced on Symbian Smartphone


Show that they will be selling half of its UIQ share to Motorola thus making UIQ
technology owned by two large mobile phone companies.

2.2.3 Types of phones

54
Sony Ericsson currently concentrates on the categories of: music, camera,
business (web and email), design, all-rounder, and budget focused phones. Its
five largest categories are:

• The Walkman-branded W series music phones, launched in 2005.


The Sony Ericsson W-series music phones are notable for being the first
music-centric series mobile phones, prompting a whole new market for
portable music that was developing at the time. Sony Ericsson's
Walkman phones have previously been commercially endorsed by pop
stars Christina Aguilera and Jason Kay across Europe.

• The Cyber-shot-branded line of phones, launched in 2006 in newer


models of the K series phones.
This range of phones is focused on the quality of the camera included
with the phone. Cyber-shot phones always include a flash, some with a
xenon flash, and also include auto-focus cameras. Sony Ericsson kicked
off its global marketing campaign for Cyber-shot phone with the launch
of 'Never Miss a Shot'. The campaign featured top female tennis players
Ana Ivanović and Daniela Hantuchová. On 10 February 2008, the series
has been expanded with the announcement of C702 and C902 phones.
And the whole new thing;Sony Ericsson C905.
• The BRAVIA-branded line of phones, launched in 2007 Japan market
only.
Now, two mobile phones (FOMA SO903iTV and FOMA SO906i[7]) uses
BRAVIA brand. BRAVIA branded phone are able to watch 1seg
terrestrial television.

• The UIQ smartphone range of mobiles, introduced with the P series in


2003 with the introduction of P800.
They are notable for their touchscreens, QWERTY keypads (on most

55
models), and use of the UIQ interface Platform from Symbian OS. This
has since expanded into the M series and G series phones.

• The Xperia range of mobile phones, heralded by the Sony Ericsson


XPERIA X1 on February 2008 at the Mobile World Congress (formerly
3GSM) held in Barcelona Spain , had opened the door for integration of
Windows Mobile Operating System into Sony Ericsson powerhouse
smartphones. XPERIA was the first trademark promoted by the Sony
Ericsson as its own and is designated to provide technological
convergence among its target user base.

2.2.4 Phone series description

Series Branding Description Origin

Older Ericsson
A
style phones.

56
C Cyber-shot Camera-focused phones. Cyber-shot

T-Mobile network exclusive


D T-Mobile Deutsche Telekom
phones.

Vodafone network exclusive


Vodafone
F phones; Gaming focused Vodafone / Fun
(partial)
phones

Web browsing-oriented
G - Generation Web
phones.

J - Low-end series Junior

Kamera (Swedish for


Cyber-shot
"camera") Kamera is
K (partial),3G All-around phones
katakana for camera in
(partial)
japanese

Business-focused
M - Messaging
smartphones.

P - Powerhouse smartphones. PDA

Phones with built-in AM/FM


R - Radio
radio

Fashion and camera focused


S - Swivel, Slider, Snapshot
phones.

T - All-around phones Tala (Swedish for "talk")

TM T-Mobile T-Mobile USA network T-Mobile

57
exclusive phones

Vodafone network exclusive


V Vodafone Vodafone
phones.

W Walkman Music-focused phones. Walkman

Convergence and powerhouse


X Xperia Xperia
devices.

Design-oriented
Z -
phones/clamshells

2.2.5 Financial information

Sony Ericsson posted its first profit in the second half of 2003. Since then, the
sales figures from phones have been:

• 2004: 42 million units]


• 2005: 50 million units
• 2006: 74.8 million units
• 2007: 103.4 million units
• 2008: 96.6 million units

Also, Sony Ericsson sold 60 million music enabled phones in 2006, including
17 million Walkman devices, underlining how its products are more popular
than Apple's iPod. Apple sold 46 million iPods in 2006. According to the
Swedish Magazine M3s issue 7/2006 Sony Ericsson is the best-selling phone
brand in the Nordic countries, followed by Nokia.

According to the IT research firm Gartner, in the third quarter of 2008, Sony
Ericsson became for the first time the third largest mobile phone manufacturer

58
in the world after Nokia and Samsung, despite failing to improve significantly its
market share (8.05% globally), and it is followed very closely by Motorola
(7.98%) and LG (7.80%).

2.3 Samsung Mobile

Samsung Telecommunication Business


Type Business unit
Founded Seoul, South Korea (1977)
Headquarters Suwon, South Korea
Key people Geesung Choi, President
Industry Telecommunications
Mobile phones
Smart phones
Products Telecomunication Systems
MP3 Players
Laptop computers
Parent Samsung Electronics

59
Samsung Telecommunications is one of five business units within Samsung
Electronics, belonging to the Samsung Group, and consists of the Mobile
Communications Division, Telecommunication Systems Division, Computer
Division, MP3 Business Team, Mobile Solution Centre and Telecommunication
R&D Centre. Telecommunication Business produces a full spectrum of
products from mobiles and other mobile devices such as MP3 players and
laptop computers to telecommunication network infrastructure. Headquarters is
located in Suwon, South Korea. In 2007 Samsung Telecommunication
Business reported over 40% growth and became the second largest mobile
device manufacturer in the world. Its market share was 14% in Q4 2007,
growing up form 11.3% in Q4 2006. In Q1 2008 Samsung strengthened its
second position on the market and achieved 15.6% world handset market
share. History of Telecommunication Business

2.3.1 HISTORY

2.3.1.1 Initial stage (1977-1993)

In 1977 Samsung Electronics launched the Telecommunication Network


business, and in 1983 it initiated its mobile telecommunications business with
the hope that this would become the company's future growth engine. In 1986,
Samsung was able to release its first built-in car phone, the SC-100, but it was
a failure due to the poor quality. In spite of unsuccessful result Ki Tae Lee, the
then-head of the Wireless Development Team, decided to stay in the mobile
business. He asked the company to buy ten Motorola mobile phones for
benchmarking. After 2 years of R&D Samsung developed its first mobile phone
(or "hand phone" in Korea), the SH-100 in 1988. It was the first mobile phone to
be designed and manufactured in Korea. But the perception of mobile devices
was very low and although Samsung introduced new models every year, each
model sold only one or two thousand units.

60
2.3.1.2 Time of changes (1993-1996)

In 1993 it was decided that the development team should focus on improving
connectivity due to specific mountain topography of Korea. They found the
optimal length of a mobile phone antenna and developed a method of using
gold to connect the point between the antenna and the communication circuits,
thus significantly reducing resistance and enabling steadier wave conductivity.
They also developed the wave-searching software that was specially designed
for Korea's topography.

Another event triggered Samsung's mobile phone business. On June 4, 1993,


Kun Hee Lee, the then-chairman of the Samsung Group during the meeting
with top executives of Samsung in Tokyo got the report about ‘Management
and Design’ This report came as a shock to chairman Lee, and forced him to
reexamine his efforts to improve the company's system of quality management,
which he had worked hard at strengthening since he had become the chairman
in 1987.

On June 7, 1993, in Frankfurt, Lee gathered 200 Samsung executives and


pointed out every problem that Samsung had and emphasized that Samsung
needed a turnaround and declared a new management initiative "Samsung
New Management". The "New Management" reached to the mobile phone
business as well, and chairman Lee gave the division an ultimatum: "Produce
mobile phones comparable to Motorola's by 1994, or Samsung would
disengage itself from the mobile phone business."

In November 1993, the development team finally unveiled a new model, the
SH-700. This model was quite remarkable. It weighed less than any other
company's models, the design was compact, and its quality was substantially
improved over previous models. Each product manufactured was tested piece-
by-piece to assure perfect quality. Phones with any kind of defect were burned
openly for all employees to see. (The products that had been burned were
worth 15 billion won, or $188 million). The burning ceremony ingrained the

61
motto 'Quality is Pride,' the essence of New Management, in every employee's
mind.In October 1994, the SH-770 was introduced under the brand name
"Anycall". It was a result of the marketing team's effort at brand-building. The
model was an upgraded version of the SH-700, with a few changes in design
and improvements in product quality. Samsung expected that branding would
change customers' perception of Samsung's mobile phone and build up their
trust. Aggressive marketing campaigns started as well. At the initial stage, the
most important objective of the company's marketing strategy was to break
customers' preconception that Samsung's phone would be inferior to
Motorola's. To market this idea of quality, Samsung developed the slogan,
"Strong in Korea's unique topography." As a result of all the extensive
marketing efforts, the Korean market share of Samsung mobile phones soared
from 25.8 percent in October 1994, to 51.5 percent in August 1995. In the same
period, Motorola's market share dropped from 52.5 percent to 42.1 percent.

2.3.1.3 CDMA Era (1996-1998)

Samsung developed its first CDMA mobile phone in March 1996, to coincide
with the launch of CDMA service. The first digital handset, the SCH-100, was
extra light and slim, and enabled clear voice communication. Before long,
Samsung became the leader in the PCS market. It partnered with KTFreetel
and Hansol PCS to provide PCS phones. Its first PCS phone, the SCH-1100,
entered the market with innovative features, including a lightweight body,
enhanced battery life, and the ability to capture delicate sounds. The design
was targeted at the young generation because the young generation had
emerged as a large and growing customer base. It also shifted its marketing
communications strategy. For the CDMA cellular market, it emphasized the
phone's new functions, for example, its voice recognition feature. For the PCS
market, the company coined a new slogan, "Strong in small sounds," to
emphasize the mobile phone's capability to capture delicate sounds.

By the end of 1997, one year after the CDMA service was first launched;
Samsung had achieved a 57% market share in the CDMA cellular market and

62
58% in the PCS market. Also, in April 1997, it achieved sales of one million
CDMA phone units.

2.3.1.4 Global market and GSM Era (1998-now)

Samsung made its first foray into the global market in 1996, when it exported
its PCS phones to Sprint, an American CDMA carrier. Sprint signed $600
million contract with Samsung, under which Samsung would provide its PCS
phones to Sprint for three years under the co-branded name "Sprint-Samsung."
After this Samsung expanded into Hong Kong (Huchinson, CDMA) in 1997,
and Brazil (TELESP and TELERJ, CDMA) in 1998. After successfully exporting
to Brazil, Samsung built a mobile phone production facility in Brazil in 1998, in
the hopes of expanding into Latin America.In 1999, Samsung secured the
number one position in the worldwide CDMA market where it accounted for
more than 50% of market share. However, the worldwide CDMA market was far
smaller than the GSM market, which accounted for 70% of the total worldwide
mobile communications market. Moreover, the domestic market was
approaching saturation, and competition was becoming more intense.

The first GSM model was the SGH-200, which was made for European
customers. But it was not as good as the company's CDMA phone. It was
difficult to hurdle the high entry barrier, which the then "Big 3" Nokia, Motorola,
and Ericsson had built for years. The company's next few models didn't attract
Europeans, either. The development team realized that a simple change in the
circuit system wouldn't work in the European market. Thus, it decided to look
more closely at the customer's point of view. They found that Europeans
preferred geometric, balanced, and simple designs. Using this information,
Samsung adopted 'simple' as the design concept, then developed a new
design to suit the tastes of Europeans.

The SGH-600 was born in September 1998. To market this model, Samsung
changed its market entry strategy by adopting a high-end strategy. Samsung
needed to escape from its low-end image. It figured that its new mobile phone,

63
with its sophisticated design and distinguished functionality, would help it do
just that. Samsung was granted the "Best Manufacturer" award twice by the
Mobile News Award, an award that was previously given to Nokia and
Ericsson.In 2008, Samsung Electronics’ Telecommunication Business declared
its new business strategy focusing on consumer and marketing. Samsung
mobile phones are divided into 6 major categories – Style, Infotainment,
Multimedia, Connected, Essential and Business.

2.3.2 Financial information

In Q1 2008 Samsung shipped 46.3 million mobile handsets 1Q 2008. Sales of


Samsung Telecommunications were 6.65 trillion KRW for the same quarter and
it represents 32% sales of Samsung Electronics. The growth is mostly
explained by continuous growth of emerging markets while there is weak
demand in developed markets. During 2007 amount of shipped units was
growing constantly: 1Q 2007 – 34.8, 2Q 2007 – 37.4, 3Q 2007- 42.6, 4Q 2007
– 46.3. In 2007 profit was 23,8 trillion KRW, while net profit reached level of 2.7
trillion KRW.

2.3.3 Samsung Group

• Samsung Electronics

• Samsung Corning Precision Glass

• Samsung Techwin

• Samsung Heavy Industries

• Samsung Engineering

• Samsung Life

• Samsung Fire

64
• Samsung Card

• Samsung Plaza

• Samsung Engineering & Construction

• Suwon Samsung Bluewings

• Everland

• Samsung Lions

• Samsung Economic Research Institute

• Samsung Medical Center

• Samsung Telecommunications

65
2.4. Motorola Mobile

Motorola, Inc.
Type Public (NYSE: MOT)
Founded 1928
Headquarters Schaumburg, Illinois, United States

Greg Brown, President and Co-CEO


Key people
Sanjay Jha, Co-CEO

Industry Telecommunications
Embedded systems
Microprocessors
Mobile phones
Products
Two-Way radios
Networking Systems
Satellite phones
Revenue ▲$36.622 billion USD (2007)

Operating income ▼ $553.0 million USD (2007)

Net income ▼ $49.0 million USD (2007)


Employees 60,000 (2008)
Website http://www.motorola.com/

Motorola, Inc. (NYSE: MOT) is an American, multinational, Fortune 100,


telecommunications company based in Schaumburg, Illinois. It is a

66
manufacturer of wireless telephone handsets, also designing and selling
wireless network infrastructure equipment such as cellular transmission base
stations and signal amplifiers. Motorola's home and broadcast network
products include set-top boxes, digital video recorders, and network equipment
used to enable video broadcasting, computer telephony, and high-definition
television. Its business and government customers consist mainly of wireless
voice and broadband systems used to build private networks and public safety
communications systems.

2.4.1 History

Motorola started in Chicago, Illinois as Galvin Manufacturing Corporation in


1928 with its first product being a battery eliminator. The name Motorola was
adopted in 1930, and the word has been used as a trademark since the 1930s.
Founders Paul Galvin and Joseph Galvin came up with the name Motorola
when the company started manufacturing car radios in 1930; the name is a
combination of "motor" and "Victrola."

Many of Motorola's Products have been radio-related, starting with a battery


eliminator for radios, through the first walkie-talkie in the world in 1940, defence
electronics, cellular infrastructure equipment, and mobile phone manufacturing.
In the same year, the company built its research and development program
with Daniel Noble, a pioneer in FM radio and semiconductor technologies
joined the company as director of research.

In 1943, Motorola went public and in 1947, the name changed to its present
name. The present logo was introduced in 1955. At this time, Motorola's main
business was producing and selling television and radios.

In 1952, Motorola opened its first international subsidiary in Toronto, Canada to


produce radios and televisions. In 1953, Motorola established the Motorola
Foundation to support leading universities in the United States.

67
In 1955, years after Motorola started its research and development laboratory
in Phoenix, Arizona to research new solid-state technology, Motorola
introduced the world's first commercial high-power germanium-based transistor.

Beginning in 1958 with Explorer 1, Motorola provided radio equipment for most
NASA space-flights for decades including during the 1969 moon landing. A
year later, it established a subsidiary to conduct licensing and manufacturing
for international markets.

In 1960, Motorola introduced the world's first "large-screen" (19-inch),


transistorized, cordless portable television.

In 1963, Motorola, which had very successfully begun making televisions in


1947 introduced the world's first truly rectangular color TV picture tube which
quickly became the industry standard.

In 1974, Motorola sold its television business.

In 1976, Motorola moved to its present headquarters in Schaumburg.

In September 1983, the firm made history when the FCC approved the
DynaTAC 8000X telephone, the world's first-only commercial cellular device.
The company was also strong in semiconductor technology, including
integrated circuits used in computers. Motorola has been the main supplier for
the microprocessors used in Atari ST, Commodore Amiga, Color Computer,
and Apple Macintosh personal computers. The PowerPC family was developed
with IBM and in a partnership with Apple (known as the AIM alliance). Motorola
also has a diverse line of communication products, including satellite systems,
digital cable boxes and modems.

In 1986, Motorola invented the Six Sigma quality improvement process. This
became a global standard. In 1990, General Instrument Corporation, which was
later acquired by Motorola, proposed the first all-digital HDTV standard. In the

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same year, the company introduced the Bravo numeric pager which became
the world's best-selling pager.

In 1991, Motorola demonstrated the world's first working-prototype digital


cellular system and phones using GSM standard in Hanover, Germany. In
1994, Motorola introduced the world's first commercial digital radio system that
combined paging, data and cellular communications and voice dispatch in a
single radio network and handset. In 1995, Motorola introduced the world's first
two-way pager which allowed users to receive text messages and e-mail and
reply with a standard response.

On September 15, 1999, Motorola announced it would buy General Instrument


in an $11 billion stock swap. General Instrument had long been the No. 1 cable
TV equipment provider, supplying cable operators with end-to-end hybrid fiber
coax cable solutions. This meant that GI offers all cable TV transmission
network components from the head-end to the fiber optic transmission nodes to
the cable set-top boxes, now at the availability of Motorola.

In June 2000, Motorola and Cisco supplied the world's first commercial GPRS
cellular network to BT Cellnet in the United Kingdom. The world's first GPRS
cell phone was also developed by Motorola.

In 2002, Motorola introduced the world's first wireless cable modem gateway
which combined a high-speed cable modem router with an Ethernet switch and
wireless home gateway.

In 2003, Motorola introduced the world's first handset to combine a Linux


operating system and Java technology with "full PDA functionality".

In June 2006, Motorola acquired the world-class software platform (AJAR)


developed by the British company TTP Communications plc.

2.4.2 COMPANY SUCCESS

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· World's Most Admired Companies, Fortune Magazine, 2008

· America's Most Admired Companies, Fortune Magazine, USA, 2007

· Yitzhak Rabin Israeli National Quality Award, Israel Society for Quality, Israel,
2007

· Strongest Brands, Business Week, USA, 2006

· Top 500 Innovators: No. 12, InformationWeek, USA, 2006

· Most Shareholder-Friendly Companies: No. 1, Institutional Investor, USA,


2006

· Corporate Award: Outstanding Contributions, IEEE Standards Association,


USA, 2006

· Deal of Distinction Award: Patent generation and robust licensing program,


Licensing Executives Society, USA and Canada, 2005

· National Medal of Technology : Highest honour for technological innovation,


Presented by President George W. Bush, USA, 2004

2.4.2.1 HOME AND NETWORKS MOBILITY

· Winner: WiMAX Flexible Point Access System, Best of WiMAX World Europe
Awards,2007

· Excellence in Technology Innovation Ongoing Achievement: WiMAX Flexible


Access Point System, EOS Awards, NXTcomm Chicago, 2007

· Industry Innovation Award: WiMAX Distributed Network Architecture,

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exchange Magazine, Best of WiMAX World Awards, USA, 2006

· Home-Networking Winners: Mot SVG2500 Wireless VoIP Cable Modem


Gateway andn Mot SBV5400 VoIP Cable Modem/ Cordless Phone System,
International CES Design and Engineering Awards, 2006

· Winner: Best Home Wireless Product, CES Mark of Excellence Awards, 2006

· Product of the Year: VoIP Open-Application Enabling Platform, Internet


Telephony, USA, 2005

2.4.2.2 RESEARCH AND DEVELOPMENT

· 100 Most Technologically Significant Products of the Year: Printed Active


Displays, R&D 100 Awards, 2007

· Nano50 Award: Motorola Labs' NED technology, Nanotech Briefs, 2006

· Malaysia Leadership in ICT R&D Award: Motorola Software Center,


Multimedia Development Corporation, 2006

· Best of ITS Research & Innovation Winner: MOTODRIVE, ITS America


Awards, 2006

· Innovation Excellence Award, Mobile Devices: Motorola China Research


Center, Excellent Innovation Team Awards, 2005

2.4.2.3 CORPORATE RESPONSIBILITY

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Corporate responsibility means harnessing the power of our global business to
benefit people. It also means doing the right thing in all aspects of our
business, including how we treat the environment, our employees, our
customers, our partners and our communities.

· Top 100 Corporate Citizens: No. 4, Corporate Responsibility Officer


Magazine, USA, 2007

· Outstanding Safety Practice Award, National Safety Council, USA, 2006

· Top 10 Most Socially Responsible Businesses, National Business Social


Responsibility Survey, Israel, 2006

· Corporate Social Responsibility Certificate, Mexico Center for Philanthropy,


2006

· Platinum Health Award, Health Promotion Board, Singapore, 2006

2.4.2.4 MOBILE DEVICES

· Winner: CNET People’s Voice Award, ROKR E8, Consumer Electronics Show
(CES), 2008

· Winner: CNET Best of CES, Cell phones and Smartphones category, ROKR
E8, Consumer Electronics Show, 2008

· Winner: Top 20 Products of CES — Editor's Choice Award, ROKR E8,


Popular Mechanics magazine, 2008

· Winner: Best of CES 2008: Best Cell Phone, ROKR E8, LAPTOP magazine,
2008

· Winner: 2008 CES Best of Innovations Design and Engineering Award,

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headphones category, MOTOROKR S9, Consumer Electronics Show, 2008

· Winner: Best of CES, Bluetooth® transfer category, Motorola T815,


Smartphone-based navigation system featuring MOTONAV, Bluetooth Special
Interest Group (SIG), 2008

· Best Ultra Low Cost Handset, 3GSM Global Mobile Awards, 2006

· Winners: MOTORIZR and MOTOKRZR K1m, International CES Design and


Engineering Awards, 2006

· Winners: Motorola/Burton Audex jacket and Motorola/Oakley RAZRWIRE,


International CES Design and Engineering Awards, 2006

· Best of What's New: MOTO Q, Popular Science Magazine, 2006

· Unique Product Winner: Motorola Audex Protective Gear, Bluetooth SIG Best
of CES Awards, 2006

· First Place Hardware/Mobile Phone: SLVR L7, CTIA Wireless E-tech Awards,
2006

· Editor's Choice, Mobile Phone: RAZR V3 Black/Pink, CNET, 2005

· Best in Class: RAZR V3 Silver, PC News Weekly, 2005

· Mobile Innovations Award: RAZR v3 Silver, Mobile News Awards, 2005

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2.4.3 Divisional Products

Enterprise Mobility Solutions: Headquarters, located in Schaumburg, IL,


comprises communications offered to government and public safety sectors
and enterprise mobility business. Motorola develops analog and digital two-way
radio, voice and data communications products and systems, mobile
computing, advanced data capture, wireless infrastructure and RFID solutions
to customers worldwide.

Home & Networks Mobility: Headquarters, located in Horsham, PA, produces


end-to-end systems that facilitate uninterrupted access to digital entertainment,
information and communications services via wired and wireless mediums.
Motorola develops digital video system solutions, interactive set-top devices,
voice and data modems for digital subscriber line and cable networks,
broadband access systems for cable and satellite television operators, and also
wireline carriers and wireless service providers.

Mobile Devices: Headquarters, located in Libertyville, IL, currently the least


prosperous arm of the firm, designs wireless handsets, but also licenses much
of its intellectual properties. This includes cellular and wireless systems and as
well as integrated applications, and Bluetooth accessories.

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2.4.4 Finances

Motorola's handset division recorded a loss of $1.2 billion in the fourth quarter
of 2007, while the company as a whole earned $100 million during that quarter.
It lost several key executives to rivals and the web site Trusted Reviews has
called the company's products repetitive and uninnovative. Motorola laid off
3,500 workers in January 2008, followed by a further 4,000 job cuts in June and
another 20% cut of its research division a few days later.

In July 2008, a large number of executives left Motorola to work on Apple Inc.'s
iPhone. The company's handset division was also put on offer for sale. In July
2008, analyst Mark McKechnie from American Technology Research said that
Motorola "would be lucky to fetch $500 million" for selling its handset business
and analyst Richard Windsor said that Motorola might have to pay someone to
take the division off the company and that the company may even exit the
handset market altogether. Its global market share has been on the decline;
from 18.4% of the market in 2007, it had a share of just 9.7% by 2008.

2.4.5 Spin-offs

2.4.5.1 Television and radio manufacturing


In 1974, Motorola divested itself of its television and radio-manufacturing
division, which included the popular Quasar brand of electronics. This division
was acquired by Matsushita, already well-known under its Panasonic brand in
North America, where it was looking to expand.

2.4.5.2 Iridium
Motorola developed the first truly global communication network using a set of
66 satellites. The business ambitions behind this project and the need for
raising venture capital to fund the project led to the creation of the Iridium
company in the late 1990s. While the technology was proven to work, Iridium

75
failed to attract sufficient customers and it filed for bankruptcy in 1999.
Obligations to Motorola and loss of expected revenue caused Motorola to spin
off the ON Semiconductor (ONNN) business August 4, 1999, raising for
Motorola about $1.1 Billion.
Motorola manufactured two satellite phone handsets for this network - the 9500
and 9505 as well as transceiver units. Some of these are still in production by
an OEM but sold under the Iridium brand.

2.4.5.3 Government and defence


Further declines in business during 2000 and 2001, caused Motorola to spin off
its government and defence business to General Dynamics. The business deal
closed September 2001. Thus GD Decision Systems was formed (and later
merged with General Dynamics C4 Systems) from Motorola's Integrated
Information Systems Group.

2.4.5.4 Semiconductor
On October 16, 2003, Motorola announced that it would spin off its
Semiconductor Products Sector into a separate company called Freescale
Semiconductor, Inc.. The new company began trading on the New York Stock
Exchange on July 16th of the following year.

2.4.5.5 Automotive
In July, 2006 Motorola completed the sale of its automotive business to
Continental AG. Motorola’s automotive unit had annual sales of $1.6 billion
(€1.33 billion) and employed 4,500. The divisions products included telematics
systems used for vehicle navigation and safety services, engine and
transmission control electronics, vehicle control, electronics and sensors used
in steering, braking, and power doors and power windows.

2.4.5.6 Split
On March 26, 2008, Motorola's board of directors approved a split into two
different publicly traded companies. This came after talk of selling the handset
division to another corporation. These new companies are Motorola Mobile

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Devices and Motorola Broadband & Mobility Solutions. It is expected that this
action will be approved by regulatory bodies and will be complete by mid-2009.

2.4.5.7 Boycott and Divestment


In 2008, the US Campaign to End the Israeli Occupation launched its "Hang up
on Motorola" boycott and divestment campaign. The campaign claims that
Motorola supplies bomb fuses to Israel which were used in the civilian attack on
the apartment building in Qana, Lebanon in 2006.

In 2006, the New England United Methodist Church also investigated


Motorola's ties with Israeli human rights violations and as a result has included
the company on its divestiture list. In 2009, Hampshire College became the first
university to divest from Motorola and other companies with links to Israel
human rights violations.

2.4.5.8 Quality systems


The Six Sigma quality system was developed at Motorola even though it
became best known through its use by General Electric. It was created by
engineer Bill Smith, under the direction of Bob Galvin (son of founder Paul
Galvin) when he was running the company. Motorola University is one of many
places that provide Six Sigma training.

2.4.6 Environmental record


Motorola, Inc., along with the Arizona Water Co. has been identified as the sources of
trichloroethylene (TCE) contamination that took place in Scottsdale, Arizona. The
malfunction led to a ban on the use of water that lasted three days and affected almost
5000 people in the area. Motorola was found to be the main source of the TCE, an
industrial solvent that is thought to cause cancer. The TCE contamination was caused
by a faulty blower on an air stripping tower that was used to take TCE from the water,
and Motorola has attributed the situation to operator error.

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2.4.7 Sponsorships
Motorola sponsored Scottish Premier League club Motherwell F.C. for 11 years. This
long term deal ended after the company started to reduce its manufacturing operations
in Scotland.

2.4.8 Ratings from interest groups


Motorola received a 100% rating on the Corporate Equality Index released by the
Human Rights Campaign in 2004, 2005, and 2006, starting in the third year of the
report.

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2.5 LG Mobile

Type Public

Founded 1958

Headquarters Seoul, South Korea

Key people Yong Nam, Vice Chairman & CEO

Mobile Communication, Digital Display, Digital


Industry
Appliance and Digital Media

Revenue ▲ $68.8 billion USD

82,772 (29,948 in Korea/ 52,824 overseas) - as of


Employees
2006

Parent LG Group

Website LG Electronics Worldwide

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LG Electronics (KRX: 066570, LSE: LGLD), is the world's second-biggest
maker of televisions and third-biggest maker of mobile phones.With its
headquarters in the LG Twin Towers in Yeouido, Seoul, South Korea, LG
Electronics is the flagship company of LG Group, one of the world's largest
conglomerates.

The company has 75 subsidiaries worldwide that design and manufacture


televisions, home appliances, and telecommunications devices. LG
Electronics owns Zenith Electronics and controls 37.9 percent of LG
Display.

By 2005, LG was a Top 100 global brand, and in 2006, LG recorded a brand
growth of 14%. Now the world's largest plasma panel manufacturer, its affiliate,
LG Display, is one of the largest manufacturers of liquid crystal displays. Also in
2006, the company's mobile phone division, LG Mobile, marketed the LG
Chocolate phone, changing the company's image of the maker of thick 3G
phones. It now focuses on the design and marketing of phones such as the LG
Shine, the LG Glimmer and LG Prada (KE850). As a result, the company was
picked as "The Design Team of the Year" by the Red Dot Design Award in
2006~2007 and is often called the "New Apple" in the industry and online
communities.

Billboards at Dundas Square in Toronto, Canada, featuring an LG advertisement.

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LG's 3G touch watch mobile phone

2.5.1 Company history

The company was originally established in 1958 as GoldStar, producing radios,


TVs, refrigerators, washing machines, and air conditioners. The LG Group was
a merger of two Korean companies, Lucky and GoldStar, from which the
abbreviation of LG was derived. The current "Life's Good" slogan is a
backronym. Before the corporate name change to LG, household products
were sold under the brand name of Lucky, while electronic products were sold
under the brand name of GoldStar..

In 1994 GoldStar gained sponsorship from The 3DO Company to make the first
3DO Interactive multiplayer. In 1995, GoldStar was renamed LG Electronics,
and acquired Zenith Electronics of the United States. LG Solar Energy is a
subsidiary formed in 2007 to allow LG Chem to supply polysilicon to LG
Electronics for production of solar cells. In 2008, LG took its first dive into the
solar-panel manufacturing pool, as it announced a preliminary deal to form a
joint venture with Conergy. Under the deal, set to be completed by year's end,
LG would acquire a 75 percent stake in Conergy's Frankfurt solar-panel plant.

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2.5.2 Sponsorship

LG Electronics sponsored the English football club Leicester City and Wayside
Rovers (Guildford) from 2000 until 2002. LG Electronics currently sponsors the
English football club Fulham F.C and Arsenal FC, deals pulled together at that
time by the ex-Marketing Director John Bernard, who now works for the
competition, Sony Ericsson. LG also sponsor the Fremantle Football Club (an
Australian Football League team) and the Australian National Rugby League
club Cronulla Sharks.

During the period 2001-2003 the company sponsored the snooker Grand Prix.
During these years the tournament was known as the LG Cup.

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2.5.3 Business divisions

2.5.3.1 Mobile communications

2.5.3.2 Digital appliance

The home appliance division makes products like refrigerators, air conditioners
and washing machines. Its 2007 sales totaled KRW 11.8 trillion, accounting for
29% of the company's total revenue. The division's profit was KRW 717.1
billion. About 35% of the company's home appliance revenue comes from the
North American market.

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2.5.3.3 Digital display

Plasma TVs, LCD TVs, Micro Display Panel TVs, Monitors, PDP Modules,
OLED Panels, USB Memory, Flat Panel Computer Monitors

2.5.3.4 Digital media

Home Theater Systems, DVD Recorders, Super Multi DVD Rewriters, CD±RW,
Notebook PCs, Desktop PCs, PDAs, PDA Phones, MP3 Players, New Karaoke
Systems, Car Infotainment

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2.5.4 Energy Star controversies

In 2006, Australian Competition and Consumer Commission announced 5


models of LG air conditioners posted misleading energy ratings, following
complaints by the Australian Greenhouse Office. Tests concluded that the
affected models had their actual cooling outputs 90% lower than rated outputs,
energy consumptions of some models were more than the rated power
consumptions, and the energy efficiency ratings of the affected models were
lower than that claimed by LG, and that of one model was lower than that
required by the relevant Minimum Energy Performance Standards (MEPS). As
a result, LG offered $3.1 million rebates for the affected models.

In 2008, U.S. Department of Energy announced the removal of Energy Star


labels from certain brands of LG refrigerators. The move also affected Kenmore
TRIO models designed by and manufactured by LG Electronics. The
discrepancy was traced back to Energy Star testing procedure allowed
manufacturers to test the refrigerators with their ice-makers turned off, which is
not how they are normally used in the home. Furthermore, DOE claimed LG did
not set the refrigerators' temperature-controllable compartments to their coldest
levels, a requirement for energy-usage measurements.

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2.6 Spice Mobile

Spice Mobiles Ltd. is a part of Spice Corp, a multi-faceted group with an


exclusive telecom eco-system in India. With “Innovation” as the company’s
mantra, Spice began the process of revolutionizing the Communication &
Entertainment sector, with its new age technologically advanced state of the art
mobile phones.

Debuting with handsets targeted at the entry-level segment, today, the brand is
growing rapidly and has a bouquet of offerings targeting entry, mid & premium
segments. Spice Mobiles Ltd has heralded a new chapter in the history of
Indian mobile telephony by launching the first ever DUAL MODE PHONES.
Continuing with the same trend of delivering breakthrough products, Spice
Mobiles launched the new Spice D-1100, India’s first Dual SIM PDA
(GSM/GSM).

Spice Mobiles is the proud winner of the Golden Peacock Award for
innovative product / service for the year 2007. Spice Mobiles added more firsts
to its credit by announcing the Global premier of the World’s First Movie Phone
and Peoples’ phone at the World Mobile Congress, Barcelona in February
2008.

Riding on the success of its venture, Spice Mobiles Ltd. has strengthened its
footprint, built a strong value proposition with the customers and established
itself as a competitive brand amongst the host of International players. Moving
forward, the company aims to achieve further brand acceptability among all
target segments through a broader offering of cutting-edge handsets that
combine mobile phone functionality with enriched content and smart device
capabilities for greater high-speed voice and data capacity.

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With rapid consumerism sweeping the country, India has emerged as the
second largest mobile handset market, poised for explosive growth by 2007.
Industry observers were of the view that the market within the first quarter of
2006 could well become a global hub for mobile handset manufacturers and we
did witness a whole lot of activity in this area.

No doubt we are heading for exciting times ahead. Competition is hotting up


too. In another report by Gartner, India has been hailed as the next big mobile
handset market by 2009. It is forecasted that China and India alone would
account for nearly 200 million units in 2007, with the Indian market surpassing
China in 2009 to reach 139 million units.

India is an emerging market and as a recent entrant we at Spice Mobile


Phones are looking forward to capitalize on the existing opportunity. As the first
truly ‘Made for India’ mobile phone brand, our growth plans in India were based
on the understanding of the market and consumer needs and we took our first
step targeting the entry-level segment. In an effort to distinguish ourselves from
the clutter, our phones were based on the value for money proposition, offering
consumer’s phones, power packed with features unheard of in the entry-level
segment till then.

We introduced S 500, a monochrome phone with speakerphone and


embedded content in the form of Singtones; the S 404N, another feature-rich
and stylish monochrome phone; the S 555, a true-tone - true-colour GPRS
phone; and the S 600, a 65,000-colour GPRS phone with an MP3 player and
128MB in-build memory. The S-450 and S 540, both FM B/W and Colour
phone respectively was again targeted at the entry segment, which was
followed by our product offerings in the mid-segment. The S 800 with 1.3 mega
pixel camera was a first phone with Video-Caller ID and the S-8, a mega slim
and 2-mega pixel camera phone, were both priced below Rs. 10,000/-

Today, Spice Mobile has built a reputation for itself and has established its
brand identity across the country. In tune with our communication theme “Style
International dil Phir Bhi Indian”, Spice is all set to introduce its high-end phone
range – Enhanced Bluetooth enabled phones, Smart Phones, and PDA. We

87
value our customers and channel partners who have helped establish Spice
Mobile Phones as a truly ‘Made by India’ mobile phone brand.

The booming mobile phone market is also witnessing a rise in consumer


demand for cutting edge phone accessories. Our strategic partnership with
Plantronics is in keeping with this demand. Under this partnership Plantronics’
mobile headsets – Bluetooth® and wired – will be sold through Spice Mobile
Phones retail channel along with options of bundling these high-end
accessories with our wide range of mobile handsets and selling as a package
to the customer.

Our strong nation-wide sales & distribution network is the backbone on which
we are spreading our footprints across the country. The establishment of “after
spice”, an effective after sales service network ensuring world-class support to
the channel and the customer was key to building our brand and acceptance
among the consumers.

The future of India market shows lots of promise and we at Spice Mobile
Phones are confident of making considerable inroads in the mobile handset
pie. We shall be introducing many exciting products and look forward for
continued support from our customers and partners. We would value any
feedback and suggestions from your side.

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2.6.1 SPICE GROUP

The Spice Group is led by Indian industry captain and global citizen Dr. BK
Modi (Dr. BKM as he is known). The group which has transitioned from being
known as MCorp Global and Modi Corp earlier, has a long and rich 30-year
history of leadership in Technology, Automation and Telecommunications.

The Group was established in the early 1980s, has been known for its
landmark JVs with global leaders in Technology & Automation, and several
pioneering business initiatives/products for the Indian market – from the first
computer, printer, photocopier, fax machine to the first Mobile GSM service call
(on the Modi Telstra Network in 1996)

The Group is currently valued at over U$1.5 bn; has more than 12,000
employees; and has a customer base in excess of 5 million across various
product/service segments.

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The Group was restructured in July 2008, to be reorganized into 4 distinctive
sector based business verticals which are

1. Telecom and related businesses through Spice Televentures


2. Entertainment, Media & Content through Spice Enfotainment
3. Financial Services, Asset Reconstruction and allied businesses in Spice
Investment & Capital Services
4. Information Technology, Software & System Integration business
through Spice Technology.

Spice has set up its global headquarters in Singapore - Spice Global Pte Ltd.,
to pursue business growth opportunities in the world’s fastest growing markets
viz. Israel to Indonesia (I-to-I). This entity which will establish various business
footprints across Televenture and Enfotainment Verticals. Spice Global Pte Ltd
is headed by President – Global Strategy & Alliances Mr. Parikshit Bhasin (a
former Nokia Asia Pacific Regional Head)

2.6.1.1 The Vision –


To be the preferred choice of energetic young minds for products and services
in the fields of Communications & Entertainment by 2011

What does Spice stand for –


SYNCHRONIZED PERFORMANCE THROUGH INNOVATION IN
COMMUNICATIONS & ENTERTAINMENT

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2.6.2 Spice Televentures

Spice Televentures is the new holding company which manages the interests
of Group in the domain of Telecom products & Services – viz. Mobile devices,
Mobile Value Added Services, Application Development, Mobile & mobile
accessories Retail & BPO Services.

Mr. Dilip Modi, who is the Group President for Global Operations, heads Spice
Televentures as its CEO and has also been appointed as Chairman of the
individual boards of the subsidiary companies under the vertical.

The board of Spice Televentures is Chaired by Dr. BK Modi, with Dilip Modi,
Divya Modi as Directors. Mr. S. K. Jain is the Executive Directors.

Knowledge partners and consultants for the Spice Televentures vertical include
KPMG, Contract Advertising, JWT India, Lintas India, The Brand Union and
several other leading consultancies.

The companies under the vertical are -–

• Spice Mobile Ltd.- Flagship of the Spice Televenture business, Spice


Mobiles is one of the fastest growing mobile handsets brands in India. It
is known for its innovation , Spice – launching several firsts including the
Dual SIM series of – across GSM, CDMA, Triband and Touch Screen
PDA formats. The company has been the winner of several important
awards including the 2007 Golden Peacock Award for Innovation.
CEO – Mr. Kunal Ahooja

• Cellebrum Technologies Ltd. – A leading operator agnostic Mobile


VAS solutions provider with 12 patents, serving every mobile operator in
India, as well as clients extending from Indonesia to Africa. Several
innovations to its credit as well – including CRBT, Music Station / Music

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on Demand, Mobile Radio, Call Block, Select Caller List etc.
C EO – Mr. Saket Agarwal

• HotSpot Retail - A leading Mobile Phones, Accessories and Services


Retailer with 400+ stores, the company was voted the best in Customer
Service by Mint-Pitch and voted the Best Large Format Retailer in North
India by Voice & Data. The company aims to become a 5000-strong
retail store chain by 2011.
CEO – Mr. Sanjeev Mahajan

• Omnia BPO Services – Omnia is now a merged entity – the result of a


JV between Spice Televentures and Mumbai based Spanco
Telesystems. Omni operates in the Domestic BPO segment with the one
of the largest human resource bases in the verticals of BFSI,
Transportation and Telecom. Rated as one of India's fastest growing
Onshore Domestic BPO services company (according to V&D) and
voted the Best Emerging Onshore BPO by Indiatimes.com in 2007.
CEO – Mr. Pravin Kumar

• Bharat BPO Services – A JV between Omnia and Spanco Telesys, the


company provides services to the 139 Integrated Train Enquiry Services
and the 137 Value Services on behalf of Indian Railways.
CEO – Mr. Pravin Kumar

• Mobisoc Technology Pvt Ltd. – The newest member of the Spice


Televentures family, the project started in early 2006 – more than 2
years ago – has seen fruition as Technology Product company in the
Mobile Internet and Application Development space. The company has
launched its flagship product
CEO – Mr. Lokesh Gupta

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2.6.3 Spice Enfotainment

The Spice Group has decided to move into the arena of Entertainment,
Media/New Media and Content & Knowledge based industries by setting up
SPICE ENFOTAINMENT.

Spice Enfotainment would work on the principle of consolidating and combining


Video, Voice & Data – focussing on new areas of Entertainment and
Information led- businesses.

With an existing footprint in Malls & Movie Exhibition (Multiplexes), Films -


Spice Enfotainment will develop, build and venture into Music, Gaming,
Television, International Film Production and Post-Production and Internet
Media & Business.
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2.6.4 Spice World & Spice Cinemas

Spice World provides family amusement and entertainment. The first


entertainment centre was opened in 2005 in Noida. The Spice World
Entertainment Centre has a marketing franchise agreement with PVR to
manage the biggest Multiplex in Northern India. Spice World has also started
“Gold Class” – an exclusive super elite theatre that includes cafes and luxury
seats. Spice World is also home to India’s first 4Dimension Theatre called
SPICE 4D. The Company aims to invest strongly in the Film Exhibition and
Family Amusement space, with a target to set up nearly 20 more such similar
Family Amusement & Entertainment Multiplexes across Northern India, before
taking pan-India. Dr BKM has indicated that he plans to increase the number of
screens from 12 to more than 100 in a horizon of 3 years.

• Spice Circle Restaurants – New Delhi, Shenzen, Beijing


• M Films- Filmed Entertainment Company
• India Splendor – A enfotainment property
• New proposed businesses - Spice Music and Spice Gaming.

Spice Enfotainment has employed the services of renowned and experienced


full-time consultants including Mr. Jawahar Wattal and Ms. Michelle Crames.
Mr. Jawahar Wattal, who is a Padmashree awardee and a leading personality
from the world of Indian films and music will focus on the Music, Entertainment
& Lifestyle verticals at Spice Enfotainment, while Ms. Michelle Crames, is a
Harvard University Scholar and an Expert in the world of Gaming, will focus on
the Gaming venture at Spice Enfotainment.

The Group will also explore all growth opportunities including organic and
inorganic growth methods to grow and expand the business.

The Spice Enfotainment Board will be chaired by Dr. BK Modi and comprise of
directors Mr. Dilip Modi, Ms. Divya Modi and Mr. Mahesh Prasad.

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Ms. Preeti Malhotra is the Executive Director of the company and former Modi
Xerox /Spice Telecom CEO, Mr. Prakash Nanani has been appointed as
President – Entertainment of the company.

2.6.5 New Verticals being created

2.6.5.1 Spice Investment and Finance Advisors Ltd (SIFAL)

The Financial Services vertical is led by an existing company which is listed on


NSE - 21st Century Capital.

The vertical will explore opportunities in Private Equity Funding, Asset


Reconstruction & IPO Financing.

2.6.5.2 Spice Technology Pvt Ltd. (STPL)

Existing business include


1. Spice Net
2. IO Systems
3. First Choice Enterprises
This vertical will also explore opportunities in New Technology Areas/ Digital
Technology.

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3. RESEARCH METHODOLOGY

3.1 Title of the study – “STUDY OF STUDENTS PREFERENCE IN


SELECTION OF MOBILE PHONE”

Title Justification – This title is justified as it tells about the students’


preference towards various mobile phone brands.

3.2 Duration of the project – The project was carried out through days.

3.3 Objective of the study

The subject matter for this research Project is to study the Students preference
towards the various mobile phones in Jaipur. This project consists of different
objectives. They are as follows:

 To know about the consumer preference level associated with


different Mobile Phone Brands.
 To find out the consumer satisfaction towards the various features
and cost of mobile phone.
 To know which advertisement media puts more impact on the buying
decision.
 To know which company has more loyal customers.

3.4 Type of Research


Descriptive

Descriptive research include surveys and fact findings inquires of different


kinds. The major purpose of descriptive research is description of the state of
affairs, as it exist at present. In social science and business research we quite
often use the term ex-post facto research for descriptive research studies. The

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method of research utilized in descriptive research are survey methods of all
kinds including comparative and correlation method. In analytical research, the
researcher has to use facts or information already available, and analyze these
to make a critical evaluation of the material. Research is a systemic and critical
investigation into a phenomenon. It is objective and logical applying possible
test to validate the measuring tools and the conclusion reached. It is based
upon observable experience or empirical evidence. Research is directed
towards finding answers to pertinent

questions and solutions to the problem. It is not a mere compilation, but a


purposive investigation. It aims at describing, interpreting, and explaining a
phenomenon. The purpose of research is not to arrive at an answer,
which is personally pleasing to the researcher but rather one which
will standup to the test of criticism.

 Visited the Students across Poornima Group of colleges & gathered


information required as per the questionnaire.

 The research design is probability research design and is descriptive


research.

DATA COLLECTION:

Questionnaire method :- (makes one questionnaire)

Questionnaire is used as a tool to get information from the sample. The


questionnaire contains 11 questions and the samples were approached
individually and answers were recorded in questionnaire form .

Primary data has been used by me in the form of Questionnaire & Observation,
which are the two basic methods of collecting primary data, which suffices all
research objectives. Secondary data sources like catalogue of the company,
product range book of the company & various internet sites such as
motorola.com & google.com have been used.

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Data Analysis:
The data is analyzed on the basis of suitable tables by using mathematical
techniques. The technique that I have used is bar graphs and pie charts.

Method Of Data Collection


The data has collected in two ways.
• Primary data
• Secondary data

Primary data

Primary data are those, which are collected for the first time , and they are
original in character. My self collected these from the consumers to study a
particular problem.

Interview was regarding the comparative analysis of the charges and services
of the company the questionnaire is attached at the end as Annexure.

The above questions were really helpful in the conclusion part of the study.
Some customers were very cooperative but some didn’t even care to listen.
Overall, the study was a success as far as primary source was concerned.

Secondary data

The secondary data are those , which are already collected by someone for
some purpose and are available for the present study. The secondary data was
collected with the help of various books, websites, bank journals, broachers
and employees of the companies. The data collected from the websites and
books was good enough to be included in the study analyzed and concluded
but the data got from the employees of the companies was most accurate and
reliable. Various newspapers, magazines, websites, etc were checked out for
information regarding the comparative analysis .

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3.5 Sample size and method of selecting sample

Sampling Size – 50 respondents


Sampling Area – Dept. of Mgmt. Studies, Poornima Group of Colleges
Sampling Technique - Random Sampling technique

3.6 Scope of the study

As learning is a human activity and is as natural, as breathing. Despite of the


fact that learning is all pervasive in our lives, psychologists do not agree on
how learning takes place. How individuals learn is a matter of interest to
marketers. They want to teach consumers in their roles as their roles as
consumers. They want consumers to learn about their products, product
attributes, potential consumers benefit, how to use, maintain or even dispose of
the product and new ways of behaving that will satisfy not only the consumer’s
needs, but the marketer’s objectives.

The scope of my study restricts itself to the analysis of students preferences,


perception of different mobile phone brands. The scope of my study is also
restricts itself to DMS-PGC only.

The scope of the research is based on the telecom industry and it throws light
on the brand preference of mobile phones.

Significance of the study:

Significance to the industry –


My research will help the telecom industry to know the current scenario of
customers with respect to brand preference of mobile phones.

Significance for the researcher –

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➢ Wide exposure to the telecom industry.
➢ Studying about the brand preference of mobile phones through the
respondents.

3.7 Limitations of the study:

· A small sample size of 50 customers was considered due to lack of time &
resource constraints.

· The scope of the project is limited to the College Campus of Poornima Group
of Colleges so, we cannot say that the same response will exist throughout
India.

· With regard to uneducated customers it was difficult to get across to them all
the features of their respective mobile phones.

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4. FACTS AND FINDINGS

• Few years back mobile phones were not common among the students.
But with the mobile revolution now we can find almost every student with
mobile phone.

• Most of the students prefer Multimedia Phones than Normal handset.

• Most preferred Mobile company amongst the students is Nokia & Now a
days Samsung becoming popular and the least preferred company is
LG.

• Mostly the students are satisfied with the services and Features
provided by the different Mobile Phone companies.

• Maximum numbers of respondents were attracted towards the


Integrated Camera and Internet Support facility and the least like the
Bluetooth and other features.

• T.V. and Newspaper are the best media advertisements that put more
impact on the students buying decisions.

• Maximum numbers of students are loyal to there particular Mobile Phone


Brand.

• After sales services are very important in Mobile industry.

• Nokia mobile and Sony Ericsson have a great market potential among
students.

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SOURCES FROM WHICH MATERIAL IS PURCHASED

Most of the Students who were surveyed said that they preferred to purchase
their material from a dealer. Distribution of products constitutes an important
element of marketing–mix of a firm. After development of a product, the
marketing manager has to decide channels or routes through which the product
will flow.

In my survey I found that almost 90% of the customers purchased their material
from local dealers and only 10% of them purchased from the sales
representative or grey market.

In the Telecom Industry there are usually National & City distributors. A three-
tier system is followed whereby:

Tier 1 – Company - - - - - National Distributor


Tier 2 - National distributor --------- Local Distributor
Tier 3 – Local Distributor ------------ Dealer

Mobile Phone companies billing of goods are directly billed to the Local
Distributor which not only helps in better interaction with them but also gives
the company a more Microscopic focus of all the happenings along with the
Accountability of goods sold. The company through this practice of it’s not only
able to increase its revenue but is also able to increase its margins better.

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MAJOR FEATURES THAT A CUSTOMER LOOKS FOR
IN A MOBILE

The Market is flooded with all sorts of mobile brands, each trying to showcase
and push forward its own particular brand with umpteen numbers of features.
The customer these days is quite educated and knows about the products quite
well and therefore likes to keep himself abreast with the latest technology
available in the market, suiting his pocket need and requirement.
Mobile these days are being added with new features every second day to lure
the customer, and it is due to these very features only that becomes the
purchasing factor for the customer. Some of the most common features that a
customer demands these days are:

1. Color Screen – Color Screen phones are the latest and the most wanted
trend in the market these days as these phones boast of a High Color
Resolution Display so that the customer can enjoy in his/her phone an
exhilarating melange of colors. Most of the color phones boast of
65000-color display, which makes not only the resolution but also the picture
quality treat to the eyes. Color screen phones are in major demand by the
public, which accounts for at least 50% in the survey conducted.

2. MMS (Multimedia Messaging Service) - With MMS, it is not only possible to


send your multimedia messages from one phone to another, but also from
phone to e-mail, and vice versa.
This feature dramatically increases the possibilities of mobile communication,
both for private and corporate use.

3. Integrated Camera – The latest in-thing, mobile phones with in-built camera.
These phones serve the twin service of mobile and a camera. One can not only
click but also store photos and even send it to their near and dear ones.

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Camera phones accounted for at least 10% respondents in the survey
conducted.

4. Tri-Band – A tri-band facility is useful for people who are constantly going
abroad as a triband enabled handset let’s one access the network of another
country also and also keeps you connected with people back home.

5. Size/Weight – These days mobile handsets come in various shapes and


sizes with different weights. The needs and requirements of a customer differ
from person-to- Person as some like bigger sets with minimum weight whereas
there are some who prefer lighter sets with lighter weights.

6. Talk/Stand by Time – Customers do pay a lot of attention on talk/stand by


time as they want a mobile, which can last the longest. Companies often
promise of talk time Of 4-6 hrs on various handsets, but ultimately it’s the
customer who has to decide and make the best choice for him.

7. WAP (Wireless Application Protocol) – WAP let’s one access the Internet-
based services supported by your network, such as news, weather reports and
flight timings etc, even when you are mobile.

8 . Battery – Every customer wants his/her battery to last the longest and all
mobile companies fight out promising that their battery backup is the best. A
mobile function on a battery and a cheap and sub-standard battery always
makes the customer vary of the companies’ products and services.

9. Mp3 Ring Tones – An mp3 ring tone is the next generation of ring tones that
has better sound quality than traditional monotone or a polyphonic ring tones.
Mp3 ring tones sound great and truly make your phone unique. Mp3 ring tones
phones are in major demand by the customers.

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MAJOR BRANDS

Most of the Students who were surveyed had almost all the Brands of Mobile
Handsets with them and the final analysis upon which I arrived at was that
Nokia is the No.1 selling Handset in Jaipur followed by Sony Ericsson
Samsung, Motorola and.

Nokia no doubt has carved a niche for itself over the past 4-5 years with its
superior technology and its loyalty towards the Indian customer which certainly
makes it the most superior brand.

The biggest advantage that has worked in Nokia’s favour is its marketing
strategy, which focuses more on their state of the art Handsets. They were the
first company to come with a mobile with an in-built camera in it and they surely
knew how to sell their product. Today almost all mobile companies have
followed suit and come out with their own in-built camera mobiles.

Nokia is certainly a value for money mobile as more than 90% of the Students
interviewed agreed on this statement, not only is the after sale service excellent
but also the quality and pricing of products is excellent. In such a scenario not
only the existing companies but also the new entrants will have to justify their
launch in the long run.

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5. DATA ANALYSIS AND INTERPRETATION

Analysis based on the questionnaires: -

DEMOGARPHIC FEATURES OF REPONDENTS

Sex ratio of the respondents

PARTICULARS NUMBER %AGE


MALE 30 60%
FEMALE 20 40%

S e x r a tio o f th e r e s p o n d e n ts

FE M A LE
40%
M A LE

M A LE F E M A LE
60%

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INTERPRETATION: The graphical representation of the table shows that out of
50 respondents 60% were male and 40% were female.
Figure 1

1 ) A r e y o u u s in g a m o b ile p h o n e ?

No
0%

Y es
No

Y es
100%

Interpretation: -
It was found out that all the 100% students are using mobile phones. This
shows that now mobile phone has become an integral part of student life.

CONCRETE TERMS: - Out of 50 respondents all 50 are using a mobile.

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Figure 2

6% 2%
4%
NOKIA
8% SAMSUMG
LG
8% OTHERS
52%
SPICE
SONY ERICSSON
20% MOTOROLA

Interpretation:-
The above chart (Figure2) shows the percentage of various handsets used by
the respondents. Nokia mobile is most popular brand and preferred by students
because of its durability and reliability. 52% market share is captured by Nokia
among students, respectively followed by Samsung 20% , LG 8% and Sony
6%. According to survey Sony Ericsson is popular among students just
because of its Sound Quality.

CONCRETE TERMS: - Out of 50 respondents 26 respondents are using Nokia


10 are using Samsung while 4 are using LG, 3 are using Sony Ericsson, , 2 are
using Spice, 1 are using Motorola and rest uses the other brands.

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Figure 3

A r e y o u s a tis fie d ?

No
12%

Y es
No

Y es
88%

Interpretation: -
The chart (Figure3) shows maximum number of respondents who were
satisfied with their handsets. 88% students are satisfied with their present
mobile handset. According to responses of Nokia mobile users, 100% Nokia
mobile users are satisfied
with their mobile handset. LG mobile users are least satisfied.

CONCRETE TERMS: -The responses to this question indicate that 88%


Students are satisfied with their handsets.

109
Figure 4

In what time you are thinking to change your


handset or buying a new one?

1 W eek
6 Month
0%
13%
1 Month
0%

1 Year
1 Month
6 Month
1 W eek

1 Year
87%

Interpretation: -
The above chart (Figure 4) depicts the respondents buying behaviour with
reference to time. Only 13% students frequently change their mobile handset
within a time period of 6 months. 87% students change their mobile handset
not before 6 months.

CONCRETE TERMS: - Out of 50 respondents 7 changes their handset in a


time period of 6 months, 43 change their handset in a year while nobody
changes their handset in a month and in a week.

110
Figure 5

4%

20% NOKIA
30%
SAMSUNG
LG
OTHERS
6%
SPICE
SONYERICSSON
14% MOTORALA
0% 26%

Interpretation: -
This chart (Figure 5) depicts the respondents’ next preference for mobile
phones. According to responses Nokia mobile have a great future, 30%
students says that they will move to Nokia mobile, and respectively Samsung
has great future, 26% students are willing to move for Samsung.

CONCRETE TERMS: - Out of 50 respondents 10 respondents are willing to


switch over to Sony Ericsson, 15 are willing to switch over to NOKIA, 13 is

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willing to switch over to Samsung, 2 are willing to switch over to Motorola, 3 are
willing to switch over to Spice and 7 are willing to switch over to others.
Figure 6

W h ic h a d v e r t is e m e n t m e d ia p u t s m o r e im p a c t o n
y o u r b u y in g d e c is io n ?

O th e rs
14%
In t e r n e t T.V .
8% Newspaper
T .V .
M a g a z in e s M a g a z in e s
52%
12% In t e r n e t
N ew spaper O th e rs
14%

Interpretation: -
The pie chart (Figure6) shows the percentage of media which puts more impact
on students buying decision. T.V. is the best advertisement media to influence
students buying decision.

CONCRETE TERMS: - Out of 50 respondents 26 considered T.V. as most


influenced advertising media, 6 considered Magazine, 7 Newspapers, 4
Internet, while 7 considered others (World of mouth).

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Figure 7

W h e r e d o y o u g e n e r a lly p u r c h a s e y o u r h a n d s e t s
fro m ?

O t h e rs
6%
G re y M a rk e t
8%
D e a le rs
G re y M a rk e t
O t h e rs

D e a le rs
86%

Interpretation: -
This shows (Figure 7) the source of purchase of handset of the respondents.
86% students purchase their mobile handset from Dealers.

CONCRETE TERMS: - Out of 50 respondent’s 43 respondents’ purchases their


handset from the dealers, 4 respondents purchases their handset from grey
market while the rest 3 respondent purchases their handset from the other
sources available.

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Figure 8

fa c ilitie s a n d fe a tu re s p ro v id e d in h a n d s e t a re
re a lly a v a lu e fo r m o n e y

No
24%

Y es
No

Y es
76%

Interpretation: -
This shows (Figure 8) that maximum respondents consider their present mobile
value for their money. According to responses 76% students consider the
features and facilities provided in their handsets Value for money.
Another reason to form this question was to know about satisfaction level of
respondents.

CONCRETE TERMS: - Out of 50 respondents 38 consider their present mobile


phones value for their money rest 12 respondents contradicts on this.

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Figure 9

W h a t a c c o r d in g t o y o u is t h e m o s t im p o r t a n t
a d d it io n a l f e a t u r e t h a t s h o u ld b e p r e s e n t in a
m o b ile p h o n e ?

O th e rs
C a m e ra
14%
22% C a m e ra
B lu t o o t h
MP3
In t e r n e t
22% B lu t o o t h
16% MP3
O th e rs
In t e r n e t
26%

Interpretation: -
This shows (Figure 9) the various additional features which customer takes into
account while purchasing handset. Here calculation shows that Camera, MP3
and Internet Functions should be their in a mobile handset. Now internet
becomes an integral part of student’s life, and it’s easy to access internet
through mobile any time any where.

CONCRETE TERMS: - Out of 50 respondents 8 gives preference to Bluetooth


as an additional feature while purchasing a handset, 11 respondents gives
preference to camera, 11 gives preference to mp3, 13 gives preference to

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Internet (GPRS) while the rest 7 respondents prefer to have some other
additional features apart from these.

Figure 10

H o w im po rta n t is a fter sale s se rvice in th e m o b ile


in d u stry?

A verage
Im portant
6% 4%

V ery Im portant
Im portant
A verage

V ery Im portant
90%

Interpretation: -
This shows (Figure 10) that the after sales service is considered to be of prime
importance to the respondents. 90% students said that after sales services are
very important in Mobile industry. This question was formed to know that does
students really consider after sales services before purchase of handset.

CONCRETE TERMS:- Out of 50 respondents 45 considers after sales services


very important while 3 respondents consider it a little less than very important
and the rest 3 respondent gives it an average position.

116
Figure 11

W h ic h k i n d o f m o b il e a r e y o u u s in g ?

N o rm a l
40% M u lt im e d ia
M u lt im e d ia N o rm a l
60%

Interpretation: -
This shows (Figure 11) that how many students are using Normal and
Multimedia handsets. 60% students using Multimedia handset, so than can use
internet facilities and can enjoy their college life with camera and music.

CONCRETE TERMS:- Out of 50 respondents 3o are using Multimedia


handsets while 20 are using Normal mobile handsets
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6. SWOT ANALYSIS

STRENGTH: -

· A well established brand names help in promoting a new range of products.


The Mobile Phone companies have a wide range of products to suite the purse
& the taste of various segments of customers.

· The Mobile Phone companies have a huge advertisement budget which helps
in brand positioning & recall.

· They have a well established sales network of more than 4000 dealers &
branch offices around the globe & they can make such of its products available
as are in demand in each particular area.

WEAKNESS: -

· The Mobile Phone companies needs to evolve a comprehensive plan &


strategy to make inroads into a part of students.

· Lack of production canters in India makes the products costlier as most of the
parts have to be imported.

· Lack of R & D canters also makes it difficult to launch new products over here.

·OPPORTUNITIES: -

· The present rate of growth of the Entertainment & Telecommunication


Industry & a large potential available in these areas provides excellent
opportunity for the companies to widen its market.

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· With the fast growing economy the pricing strategy needs to be tackled with
care as it
can decide upon long term decisions of the companies.

· Globalization is yet another opportunity, if failed effectively & promptly.

India offers an unprecedented opportunity for telecom service operators,


infrastructure vendors, manufacturers and associated services companies. A
host of factors are contributing to enlarged opportunities for growth and
investment in telecom sector:

· An expanding Indian economy with increased focus on the services sector

· Population mix moving favourably towards a younger age profile

· Urbanization with increasing incomes

Investors can look to capture the gains of the Indian telecom boom and
diversify their operations outside developed economies that are marked by
saturated telecom markets and lower GDP growth rates.

THREATS: -

It is natural that threats from the existing as well as new entrants will affect the
present turnover & Market share. The nearest competitors having the identical
product range are the greatest threat to the company.

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7. CONCLUSION

Hereby I can conclude from this research that Nokia has the maximum brand
preference as compared to other brands.

According to the Survey advertising & promotional schemes along with other
schemes also affect the consumer’s willingness. Aggressive advertising put into
effect for a long time in the customers mind, which influence the people, are
T.V, Newspapers & magazines.

Students prefer a Brand due to the quality & technological superior features.
Consumers also judge the after sale service availability of the company before
purchasing a mobile.

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8. RECOMMENDATIONS

· The Mobile Phone companies should try to reach maximum Consumers in


INDIA by making distribution channel more effective.

· The Mobile Phone companies should continue to work on the Strategy of


T.Q.M (Total Quality Management)

· Consumers do not get satisfied with the promotional policies of the


companies. New techniques of promotion is required to create awareness
about the entire range of mobile products

· Mobile phone companies should focus on students need and try to make
mobile handsets accordingly.

· More loyalty programs should be there to retain existing customers.

· Companies should focus on after sales services.

· Companies should focus on T.V. advertisement.

· To attract students companies should organise promotional events through


Colleges.

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9. APPENDIX
QUESTIONNAIRE
For
“STUDY OF STUDENTS PREFERENCE IN SELECTION OF MOBILE PHONE”

Name – College--
Contact no.-
Sex- male female

Q1. Are you using a mobile phone?


 Yes  No

Q2. Which company handset are you using?


 Nokia  Samsung
 Motorola  Sony Ericsson
 Spice  LG  Others

Q3. Which kind of mobile you are using –


Normal  Multimedia

Q4. Are you satisfied?


 Yes  No

Q5. In what time you are thinking to change your handset or buying a new one?
 With in a week  With in a month
 With in six months  With in a year

Q6. To which handset will you move?


 Nokia  Samsung
 Motorola  Sony Ericsson
 Spice  LG  Others

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Q7. Which advertisement media puts more impact on your buying decision?
 T.V.  Magazines
 Newspapers  Internet
 Others Specify……………………………………………

Q8. Where do you generally purchase your handsets from?


 Dealers  Grey market  Others

Q9. What according to you is the most important additional feature that should
be present in a mobile phone?
 Integrated camera  Bluetooth
 Mp3  Internet enable  Others

Q10. How important is after sales service in the mobile industry?


 Very important  Important  Average

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10. BIBLIOGRAPHY

BOOKS:
• Marketing Research – G. C. Beri
• Research Methodology – C.R Kothari
• Principles of Marketing – Philip Kotler

Web Resources:

• www.trai.gov.in
• http://www.tataindicom.com/t-aboutus-ttsl-organization.aspx
• http://www.rcom.co.in/webapp/Communications/rcom/Aboutus/aboutus_
home.jsp
• http://www.ideacellular.com/IDEA.portal?
_nfpb=true&_pageLabel=IDEA_Page_AboutIdea
• http://www.bsnl.co.in/about.htm
• www.wikipidia.com
• www.sonyericsson.com
• www.motorola.com
• www.nokia.co.in
• www.spicecorp.in
• www.spiceindia.com
• www.motorola.com
• www.phoneindia.com/motorola-phones.html23k
• www.phoneindia.com/samsung-phones.html21k
• www.phoneindia.com/LG-phones.html19k
• www.phoneindia.com/sonyericesson-phones.html23k

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