Introduction
This case investigates the time between 2000 and 2011 in the Jamaican telecommunication industry, as it changed from being a monopoly to vibrant competition in these emerging eleven years. In the fiscal year 1999, the Jamaican government decided to liberalize the telecommunication industry which dined in the year 2003. With this vibrant competition in the industry, Cable and Wireless Jamaica, the parent company of the LIME renamed their name to LIME that means landline, internet, mobile, and entertainment. The name was changed to encounter the competition from the biggest competitor of LIME Digicel. In Jamaica, Digicel is the market leader, it has the highest market share as compared to its competitors LIME and Claro. In March 2011, move that surprised the analysts that Digicel Jamaica signed an agreement with its competitor Claro to acquire Claro Jamaica and in return would sell its business in Honduras and El Salvador. This unexpected deal threatens to create the monopoly in Jamaica.
This monopoly will question to the survive of LIME in the Jamaica, now managing director Garfield Sinclair has to make intensive decision to block this contract or delay so that he can take some time to resolve this problem.
Market Consolidation In The Telecommunication Sector Will Lime Survive Harvard Case Solution & Analysis
The main problem in this case is that Sinclair the managing director of LIME and his team have to fight and make a bold decision against the Digicel’s decision to acquire Claro Jamaica. This move will create problems in a way that, with this decision, Digicel will be able to get the access to Claro equipment and it could introduce 4G network in the Jamaica Island. This decision will give the monopolistic position to the Digicel in the market and it would shut the other players out form the market. Analysts argued that this decision would increase the subscriber base of the Digicel telecommunication company from 2.1 million to 2.79 million as compared to the subscriber base of LIME about 757,000 subscribers.With this deal, Digicel would be able to acquire all the assets of Claro, including its telecommunication license, its technology and also its equipment.
It would help Digicel to increase its market share and profits as well. This deal would benefit both the parties, as Digicel will create its monopolistic position in Jamaica and as per the records and it is also mentioned in the case that Claro would be able to grow its subscribers in the El Silverado.
Positioning Statement
Company has the negative image in the mind of consumer because of its monopolistic behavior and due to that its market share has been decreasing. Moreover, the deal between the Digicel and Claro is the threat to the survival of the company in the Jamaica. Now LIME has to take some serious decisions to deal with the future problem that they are going to face because of this deal. One important decision they can take is to introduce the 4G technology in the Jamaica and also it has to invest in the social services and other activities to create the positive image in the mind of consumer...............
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