Virgin Mobile UK Market Entry Analysis

Strategy - Essay Virgin Mobile UK Market Entry Analysis Future Challenges for Virgin Mobile Post-entry performance: • Subscriber growth o Fastest subscriber growth of any UK operator – achieve 500,000 subscribers in less than one year and 1m subscribers in 18 months o Compared to other UK operators – time taken to acquire 500,000 subscribers: BT Cellnet (mmO2) over 5 years, Vodafone over 4 years, One2One (T-Mobile) 3 years and Orange 2 years o Exhibits to show charts on operator subscriber numbers and market shares o Strong customer acquisition while competitors face falling new connections – i. ... capturing a large % of new wireless market – can this be interpreted as evidence that Virgin enticed non-users to enter the wireless market – value creation? o Exhibit on net subscriber additions for Q1 2003 • Capturing customer value o Virgin has highest average revenue per user for PREPAY customers in the UK o Exhibit on monthly prepay ARPU Q2 2003 Virgin’s actions changed the consumer wireless industry landscape • Lowered barriers to entry and increased rivalry o Conventional view that player needed huge capital investment AND government licence to enter mobile market discarded o It is now a “brand” game – as wireless devices become products of mass consumption, brand plays an ever increasing role in securing market share o A rush of imitators trying to leverage their own brand power – FT mobile, Carphonewarehouse/Fresh, Man.

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