As the telecoms giants AT&T and Verizon face increased competition in the industry, it can be easy to think that both companies may face a managed decline. With new market entrants pushing prices down and the gradual migration of customers to the offerings of lower-priced competitors, it is natural to wonder what the future holds for these telecoms giants. In this article, we will look at the challenges that AT&T and Verizon are facing, and explore whether the two companies can escape managed decline.
1. The End of an Era – AT&T and Verizon’s Market Decline
The last thirty years have seen a dramatic shift in the distribution of the cellular industry. Over that time, AT&T and Verizon have been the two overarching companies who have provided wireless services to millions of customers in the United States. Unfortunately, their reign of dominance has recently come to an end.
What initially set these two companies apart was a combination of convenience and superior coverage. However, as the years went by, their services have become increasingly outpaced and outmoded. Here are a few of the factors that have caused them to lose ground:
- Market saturation: With the sheer volume of competition in the wireless market, it has become ever more difficult for AT&T and Verizon to distinguish their services.
- Lack of innovation: There are few services that these companies have introduced to stand out to customers.
- Higher costs: With theiron going leveraging on the consistency of the customer base, prices have risen over time.
What these unfortunate developments have meant for AT&T and Verizon is a significant hit to their market share. Analysts estimate that the two companies will have lost a combined 8-10 percent of their once combined 70 percent market dominance by the end of 2019.
2. Has Monopoly Configuration Forced AT&T and Verizon onto the Defensive?
The US telecom industry has seen major waves of consolidation in recent years, with two companies emerging as the dominant players. AT&T and Verizon have an overwhelming presence in the market, but new entrants to the market have been pushing back against their monopoly status.
The most notable of these is Sprint, which has recently begun aggressively taking on the market leaders. Sprint’s new, unlimited data plans have pressured AT&T and Verizon to respond in kind or lose out to the competition. As a result, both companies have been forced to forego their long-held positions on affordable data plans and offer better deals to customers.
Sprint’s strategy has not been without its successes. Millions of users have already switched to their service, and with the added competition, AT&T and Verizon have been prevented from raising prices. Furthermore, Sprint has been able to gain market share in spite of lackluster customer satisfaction ratings. This has put them in a position to further challenge AT&T and Verizon’s dominance, and push the telecom industry to better meet customer needs.
- Sprint’s aggressive pricing has put AT&T and Verizon on the defensive.
- Sprint has gained millions of customers and market share in spite of lackluster customer satisfaction ratings.
- The competition put forth by Sprint has prevented AT&T and Verizon from raising prices.
Overall, now more than ever, the telecom industry is in need of change. The emergence of new entrants has forced AT&T and Verizon onto the defensive, and the market is now more competitive than it has been in years.
3. A Possible Solution: How Can AT&T and Verizon Adapt to the Changing Landscape?
As AT&T and Verizon remain dominant players in the telecommunications industry, the changing landscape provides an opportunity for them to potentially offer more. Service flexibility, as opposed to rigidity, stands out as one of the keys to adapting to new trends. To start, for consumers, they should provide packages with more inclusive options. This should allow users to choose the features that best fit their needs while avoiding unnecessary costs.
Integration with the ever-growing list of connected devices is another important aspect to consider. To remain competitive, AT&T and Verizon should focus on integrating their services with the latest devices and creating convenient ways to access them. Additionally, they should research current user behavior to understand what is lacking in the market and develop new ways to approach it. Through innovation, these providers could take advantage of the changing landscape and expand their offerings.
- Service flexibility
- Include more inclusive options
- Integration with the list of connected devices
- Research current user behavior
4. Shifting Strategies - Technical Innovation as a Necessary Ingredient for Success
As the business landscape continuously evolves, so too must the strategies companies employ to remain competitive and successful. Technical innovation should be viewed as a necessity in any successful strategy to ensure companies remain ahead of the game.
- Integrate automation: Automation of certain processes offers a number of benefits including faster execution, improved efficiency and reduced human error. Automating mundane tasks can free up resources to focus on other more meaningful tasks.
- Leverage AI & Big Data analytics: By leveraging powerful tools such as AI and big data analytics, companies can gain valuable insights into various aspects of their business. This enables the understanding of customer behaviour, evaluation of business performance and the ability to improve operations, leading to improved services and higher profits.
- Utilize cloud-based solutions: Cloud-based solutions are becoming increasingly popular in a variety of industries. From storage to computation, cloud solutions can improve the scalability of a business, as well as the speed and efficiency of communication. Additionally, they can simplify the process of collaboration and increase data security.
Implementing technical innovations may require considerable costs and investments but the returns on these strategies are often worth it. Technical innovation is no longer an advantage, but a requirement for long lasting success in today’s volatile business environment.
It is clear that AT&T and Verizon have faced some tough times but if their recent decisions are a positive sign of the future, we may yet see these companies deliver dazzling returns over the coming months and years. It is now up to them to grasp the opportunities that lie ahead and prove to the world that they can indeed escape managed decline.