(IDD Market - Hutchison Page 5)
In
the past few years, the Asia economic crisis reduced the growth of Hong Kong
economic. The rate of unemployment has increased rapidly. In this situation, the
incomes of many people have reduced. This affects the consumers’ purchasing
power as well as their spending patterns. Under this economic recession, the
consumers are spending more carefully than in the
previous years. When they are going to buy the IDD services, they will focus on
price rather than quality. Therefore, price becomes the first consideration for
most of the consumers to choose the company. This is one of the reasons why
there is a vigorous ‘price war’ among the companies.
4.4
The
introduction of fibre optics has replaced the past copper wire transmission
media in these few years. The advantages of this ‘hair-thin’ transmission
fibre optics can carry the messages and data faster and more accurate. The
volume of transit capacity of fibre optics will also be much greater than that
of the copper wire. With this development, customers can enjoy the IDD services
with better quality but at a lower price.
On
the other hand, the development of Internet has introduced some new methods of
communication, such as electronic mail and ICQ. Although these methods are very
popular now, IDD service is the most convenient, direct and friendly way of
communication. As a result, it is believed that IDD services will not be
replaced by the electronic communication in the nearest future.
4.5
Competitors Analysis
In
the comparison of Hutchison with other competitors in the IDD market, i.e. Hong
Kong Telecom, New T&T, New World and CTI, it also shows the strengths and
weaknesses of Hutchison. The comparison will concentrate on seven areas. The
seven areas are price, quality, coverage, waiting time, value-added, outlets and
variety of products in the companies.
Price is the most concern of the customers as we have mentioned above. So we will look at the price first. Hutchison has an advantage on the price. As Hong Kong Telecom always set the price at a certain high level so as to match with its image of high quality and leader of the market and the price level of Hutchison is lower than that of New T&T and New World. Although CTI has a lower price than Hutchison in some areas, Hutchison has a lower average price than CTI. So Hutchison has a competitive advantage on the price.
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