Professional Documents
Culture Documents
Introduction
market. The company has been reporting losses consistently for the last
three years.
competition. It fights for market share with other market giants such as
AT&T, Verizon, T-mobile etc. Under ‘Risk Factors’ in their latest SEC-10K
filing (financial year ended 31st December 2009) the company states the
following risk “As the wireless market matures, we must increasingly seek
struggling in a red ocean. Ironically, till the recent past the statistics show
that they have only been losing out their customer base to their
competitors. The product service that they offer does not differentiate
them substantially from their competitors. The strategy that they have
the product service, which however does not propose much value
by its competitors.
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Blue Ocean Strategy(Sprint Nextel Corporation)
Threat of substitutes
Barriers to entry
The wireless segment of the firms business which contributes to the major
control over the rate of firms entering the CDMRS segment. Sprint and its
which are very extensive. The huge infrastructure requirements and the
that there is still a good chunk of unallocated spectrum does present a ray
Buyer Power
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Blue Ocean Strategy(Sprint Nextel Corporation)
wars are waged on the basis of price. This combined with the insignificant
companies to continually lower the cost and in the case of Sprint, even
enticing them to sell communication gadgets for prices far below their
Degree of Rivalry
and hence a high degree of rivalry exists. The market has reached close
to maturity and hence the only way for firms to significantly boost their
firms to cut down on their prices, offer gadgets at prices below their
Supplier Power
Most of the infrastructure and other services required for this industry is
Motorola is the sole supplier of gadgets that work in their iDEN (integrated
in any other networks other than iDEN. Hence cooperation and efficient
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Blue Ocean Strategy(Sprint Nextel Corporation)
among rival players. None of the major players have shown any attractive
returns and firms like Sprint have projected losses consecutively for the
last three years. None of the players yet have indicated any signs of
carving out a blue ocean for themselves. They are all pitched against each
‘voice data’ from any point in the country to anywhere in the world. This
world is witnessing with respect to how people interact and how business
is done.
Below we investigate the blue ocean opportunities for sprint, in line with
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Blue Ocean Strategy(Sprint Nextel Corporation)
control. However the promises that these possibilities present span far
present mobile network can track the location of any mobile phone, by
nearest base station tower of the network. The power used up by the
during communication (ie while a user talks) and for other applications
such as games, calculator, lighting up the display etc. A very small gadget
, which performs the sole function of synchronising with the base station
tracking tool. This tool can be further enhanced if additional features such
as a speaker be incorporated such that it can give out a tone when signals
for tracking it are received (much the same way as how a mobile phone
rings when it receives a call). This could help detection as well. Such
and can be used to in tracking objects such as cars, laptops, pets, wallets
and even small children (of course, the health issues regarding wave
particular application). It can also come handy for small freight companies
who cannot afford the sophisticated tracking devices that big firms use, as
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Blue Ocean Strategy(Sprint Nextel Corporation)
this would help them track the exact location of their fleet on a continuous
time basis.
In the mobile phone service segment, most of the times the user and the
certain features of the internet. However the mobile phones have still not
reached a stage where it can access all the features of the internet at the
pace a laptop can from a wi-fi or broadband internet source. This has to
do with the difference in the layout of the mobile phone network versus
the internet network. When a user looks in for information on the internet
from his mobile phone, the mobile phone sends the signal to the nearest
base station tower, the base station tower forwards this signal to another
base station that can process internet data, the requested data is then
obtained from the internet gateway allocated to the network owner, this
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Blue Ocean Strategy(Sprint Nextel Corporation)
latest technology has made it possible to access the internet as well , the
basic network framework makes it rather less effective in providing all the
services offered by the internet. However if the base station towers are
turned into an internet network. This would mean a full scaled internet
access at every nook and corner of the country. However the picture is
not all as well as it seems, a major bottle neck towards the realisation of
download). This issue can be dealt with reducing the span area of the
routers thereby reducing the demand on energy from the mobile gadget.
to cover the given area. This in turn means a good deal of investment.
one go. It could be laid out in a phased manner. The system can be first
could be very similar to the one proposed in one of the cities on the west
enabling a wifi connection throughout the city. The major advantage with
this is the shift from a market of mobile audio communication (Red Ocean)
would be done over VOIP (Voice over internet protocol). Users could do
This is effectively combining your mobile phone and your laptop in one
piece.
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Blue Ocean Strategy(Sprint Nextel Corporation)
However with the introduction of the internet network , they could focus
on the more high tech and suave appeal the technology would bring in,
attracting initially the high net worth clients and then slowly expand its
future when viewed across time. Studying the present trends, it can be
bound to change even more in the future. The driving force for this
continuous basis and keep abreast with most of things happening in their
lives. A similar trend can be observed in the work style. With more and
more work getting outsourced , the requirement for all the resources
the coming years a lot number of industries might find it more convenient
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Blue Ocean Strategy(Sprint Nextel Corporation)
for its employees to work at the comfort of their home rather than
togetherness for the employees, irrespective of how far they are located
imagine a world fully connected, such as the sensory image of sound and
vision from any part of the world is accessible anytime to anyone. This in
short would grant the mortals the ability hitherto ascribed only to the
Looking at the two potential blue ocean opportunities spotted so far, the
promising picture .
Focus
Refer the strategy canvas sketched for Sprint , in the appendix. It can be
noticed that the new strategy has a clearly focussed target where it
Divergence
Notice that all the players in the conventional mobile technology are
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Blue Ocean Strategy(Sprint Nextel Corporation)
which they compete are clearly different from what is set by the
Compelling Tagline
Sprint can adopt the following tagline “We empower you by making you
and benefits the product has to offer. It is clearly different from any other
Hence it can be surmised that the adoption of this new strategy would
help Sprint break out of the bloody red ocean battle it is involved in right
now and bring more value to itself and its customers in a new blue ocean
market.
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Blue Ocean Strategy(Sprint Nextel Corporation)
Reference
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Blue Ocean Strategy(Sprint Nextel Corporation)
Appendix
Eliminate Raise
below cost.
(long term)
Reduce Create
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