New Price War Could Cost Many Jobs in the Telecommunications Industry

Comment: Price War this week got a new kick, which came from 3-followed by our site. But the new structure puts telecom companies under pressure, which can result in cutbacks and layoffs. The customers are the big winners.

Since launched the new subscription prices with free speech, no set up fee, free SMS, free MMS and outrageously large amounts of data, put the time in to count the machines with the other Danish telecommunications companies.

But first I would remind you that the low consuming customers will have to pay more for their telephony, which there has not been much focus on the past week. Our site was 3’s 129-NOK solution with 2 GB of data and free SMS/SMS over night turned into 159 dollars-and now only with 1 GB of data. The bonus would then be free speech. If it must be a good deal for customers, it requires that there is talk through.

No matter what, so should the money come from somewhere. It may be the small customers, who pay more, or new crafty creative fees introduced in the dead of night, while customers are looking the other way. For good 14 days ago selected Telmore to raise a large number of hidden prices, which the customers only found out, if they nærlæste a very long information mail.

Rationalisation, cost savings and layoffs

Telecommunications companies can also look at how that can be saved on the operation. An example of this was seen in november 2012 when  our site presented the discount company Onfone under YouSee and M1 under the Full rate. It is very likely we are going to see more of this. In the aegis can CBB Mobil and our site Bibob perhaps be merged, while our site could consider what could happen with URf.eks. Call Me At 3, it will be natural to place Oisters customers directly into the main company.

In economics, the heads of organizations are probably already started with the great calculator, with the Strip, to find places where there can be saved. Here are all in principle into play.

The employees themselves can pick up their mail at the reception, or should there still be an internal mail carrier? Is the scheme for animals, coffee for cafeteria cheap and how many must there really be employed in the local shops? Perhaps there are “secret agents” that no one really knows what is doing, and perhaps can functions be merged and trimmed organization – a maneuver several other companies also have been through.

Generally, all employees of telecommunications companies lie in the belt, to make himself expendable, or simply start looking job listings.

Many money-billions-are lost

If package deals where everything is included will be generally in the industry, it can cost an incredible amount of money for the companies, because they do not have more to invoice. Before could be our site speculation in to sell the customer a for small package, and then hope for an overuse, which could form the basis for an additional expense on the statement.

With the packages is the end. Who all pay a fixed price with so much data (and speech + messages) that only a few coming across the border, thus no extra expense. For customers, it’s a perfect situation, but with the companies does it hurt in turnover.

The amount of lost revenue is calculated in billions.

Still major investments ahead

Even if billions at risk of fosse out of the box, there are still huge investment ahead that cannot be saved. Network and infrastructure are telecommunications companies need to continue to spend large amounts of money on, because if your network will be bad due to overloading or lacked expansion, disappearing customers to competitors.

Figures from the Strand Consult show that telecommunications organizations in the period 2007 to 2011 has invested 40.7 billion in infrastructure. By comparison, the State and the regions 32.6 billion invested in railways and hospitals. The rule of thumb is that the future expected investment of about seven billion dollars a year in telecommunications infrastructure.

Right now expanded that 4 g LTE networks as never before, and nothing suggests development stops in the industry. New smartphones, tablets and interactive devices, putting ever greater and greater demands for “always on”, from the customers ‘ side.

Assembles 3 until a sale?

When a telecom company suddenly throws himself over a major price war, it is usually because they make it saleable. It has been seen before. Recent examples are Bibob and Onfone. In the latter case, in the end the TDC at any buyouts, put an end to price the party – not least disabling TDC, further fare decreases.

The entire skaf-customers-and-be-bought trend started in the year 2000 when IT-entrepreneur Frank Rasmussen founded Telmore, three years later, to sell 20 percent to TDC. Today, Telmore completely TDC-owned. The whole show recurred in 2009 when Frank R sold his the time newest project Bibob to our site.

After following several other contractors, in addition to Frank R, been quite rich.

3 could be an interesting opkøbsmål, but the problem is the network, which is not interesting for the buyer, there is probably only going to have customers. If Telia or TDC bought 3, they could basically just run 3 ‘s cell towers on recycled square. Vodafone and TDC have even good network — and later that year added Telenor and Telia’s network together. 3-the network is thus superfluous.

Of course there may be other reasons for the start of a price war. It can also happen if a telecom company will lose many customers, so can a weapon against this be, to focus on prices.

One thing is certain. Trend is stronger than ever before, and the customers are the big winners. Figures from the Norwegian Post and telecommunications surveillance shows that Denmark is about 45 percent below the OECD average for mobile prices.