Telecom Italia Development Strategies in Both the Domestic and the International Market
In order s competitive environment, TLC operators (the Telco) have adopted a
Strategy based on developing innovative services and applications (e.g., Mobile Broadband, IPTV/WebTV, Technology, Online Advertising, Digital Home, etc.) to balance the effects of competition and price pressure of traditional services.
The above data concerning Telecom Italia clearly show that the former monopolist lost its market share in both fixed and mobile TLC. It is evident that in a first phase the company has found it difficult to set strategies to defend their competitive share from a series of aggressive players coming onto the market after the liberalisation of the sector.
Therefore, it is now necessary to identify the competitive strategies that the main Italian telephony group is adopting on the domestic and international market to cope with the main national and international players.
As for the domestic market, among the strategies that Telecom is currently developing and will develop in the future, the most relevant are the following:
• proposing lowest rates with bundle offerings (all inclusive), unlike the past where the company had a monopoly on the industry;
• promoting innovative products with free additional services (such as smartphones with internet free for two months);
• improving the customer care;
• segmenting the quality to promote different offerings on the territory in order to meet different needs of customers;
• simplifying rates through eliminating those with different bands (peak and off peak) related to hours and days of the week, and removing those related to the difference between weekdays and holidays;
• achieving greater transparency concerning the bills for the user;
• introducing a new model of operational business, to protect the value of the Internet connection, strengthening, at the same time, the cash flow, through the development of an all-IP network that is able, on one hand to support new services and, on the other, to ensure best performance on fixed and mobile networks at lower costs;
• focusing on Mobile Broadband that, in the coming years, will represent a major strategic and commercial opportunity for the mobile TLC industry, able to offset the erosion of some traditional items of income, such as voice and messaging;
• developing new market segments ensuring growth over the medium term, such as: Mobile
• Advertising, Mobile Content (e.g. Social Networking), Mobile Payment, Location Based Services,
• chieving continuous improvement of service quality with a view to customer satisfaction and
• customer loyalty;
• developing new partnerships with Top IT players and operating selectively in emerging vertical