Value Innovation and Business Model of Telecom Operators: Comparison of Taiwan Mobile and Chunghwa Telecom
Date Issued
2011
Date
2011
Author(s)
Huang, Wen-Hua
Abstract
When more consumers pay and download the application or contents from app store using iPhones, the Telcos (telecommunication operators) know they lose profit opportunity in the application or content business except all-you-can-eat data access revenue. When more consumers use the internet connected TV (e.g. Yahoo! and Google TV) to watch video on demand and surf on net at the same time, the cable TV service operators know they are out-of-date. When the big two Telcos (Chunghwa Telecom and Taiwan Mobile) simultaneously announce to be the leader in digital convergence field in 2007, they know they don’t just compete each other in telecom industry but they face many global competitors from other industries. And these competitors are also their alliance partners. So they have to take a totally different thinking way to create value innovation and build up business models.
The thesis refers to the theories like industry value chain, value innovation, value net and business model. And it collects the news-clippings and public information of the big two Telcos dated from 2006/1/1 to 2010/11/30, and it also collects recent research reports or articles regarding the innovation of global internet players in digital convergent arena. Based on the theories and the collected data. The body of the analysis is from Chapter 4 to 6. In Chapter 4, it gives an overview and summary of the telecommunication industry and big two Telcos. It includes the market status, financial status, efforts for digital convergence and organization changes for each telco. In Chapter 5, the thesis defines seven types of innovation based on the industry value chain. They are content /application, solution, roaming, tariff, network system, device and channel. Based on the news of the big two Telcos in past five years, I summarize the value innovation changes, the business model components related to each innovation, and the matrix of seven innovation type mapping to nine business model components. In Chapter 6, the thesis starts from the traditional value net and then goes to the sophisticated value net for digital convergence players. In order to create the highest value for customers and itself in the sophisticated net, each player should think how to compete and cooperate with other players at the same time. The thesis gives an analysis framework in end of the chapter.
In Chapter 7, I summarize the conclusions that echo to the questiones and analysis in the previous chapters. To sum up, I come out a matrix of value innovation mapping business model and a value net analysis framework. The former one provides Telcos a framework for value innovation in intra-industry value chain. The latter one provides Telcos a framework for value innovation in cross-industry value net by both competition and cooperation. Anyway, the thesis is just a starting point for value innovation and business model study in digital convergence, so some topics are recommended for reference or further study in the end of the thesis.
Subjects
Value Innovation
Business Model
Digital Convergence
Value Net
Taiwan Mobile
Chunghwa Telecom
Telecommunication Operators
Type
thesis
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