5. Strengths, Weaknesses, Opportunities and Threats STRENGTHS • Consumers across the UK now rely heavily on having a form of mobile communication at their disposal. The market is fast becoming an essential for the population and the chances of it changing are extremely low. • The UK industry is one that sees the most innovative and technologically advanced phones worldwide. • Compared with other nations, the UK has a relatively high adoption level for technology. Many consumers are quick to integrate new technology into their daily lives. The networks in the UK are currently providing the UK with relatively high-speed wireless Internet for mobile phones through 3G. • Smartphones have sold extremely well in the UK and applications (‘apps’) have created a new revenue stream for the industry. WEAKNESSES • There is a danger that mobile phone manufacturers will see their profits dwindle as prices for more technologically advanced handsets fall. • The industry spends a great deal on marketing because competition is fierce.
This ultimately has a detrimental effect on the profits of the industry. • The UK market has huge barriers to entry in terms of mobile service operators as Ofcom has to vet and regulate any new entrants. OPPORTUNITIES • The industry is constantly subject to new breakthroughs and could easily produce new handsets that incorporate new technologies to encourage a continuous cycle of buying from consumers. • Technological convergence is continually increasing and some ideas and manufacturers may come into the market from the computer industry. The overall usage of mobile phones is still increasing. The proportion of the population using a mobile phone has gradually increased for many years. • A SIM (subscriber identity module) -only option for consumers has so far performed well and there is scope for growth in this area. Mobile Phones Strengths, Weaknesses, Opportunities and Threats © Key Note Ltd 2012 43 • As mobile phones become more technologically advanced, companies can tie consumers into longer contracts. THREATS The industry is constantly at odds with health campaigners who claim that holding a mobile phone to your head and mobile phone masts are detrimental to your health. • The industry is subject to an extremely large auction at the end of the year for access to the 4G spectrum. Companies could potentially overstretch themselves by bidding for this. • There could be a point in the future when upgrades will become less noticeable and consumers might be less inclined to buy new handsets before they need to. Mobile Phones Strengths, Weaknesses, Opportunities and Threats ©