UK Mobile Phone Industry

This report provides a comprehensive environmental analysis of the UK mobile phone industry, including a PESTLE analysis of the industry environment, an assessment of the prevalent competitive forces using Porter’s 5 forces analysis, and an individual SWOT analysis for each of the major network operators in the UK, Vodafone, T-mobile, Orange and O2.



The government regulates airwaves by issuing airwave frequency licences and limiting the number of operators in the commercial mobile phone sector. In 2000, the Government made available five 3rd generation (3G) licenses.

These were subject to a bidding war, with 13 companies bidding. “The licences sold for total of ? 22. 48 billion, vastly in excess of the predicted ? 3 billion” (Joyce & Woods, 2001), raising speculation that the five winners paid over the odds. Vodafone bought license B for ? 5. 96 billion, BT license C for ? 4. 03 billion, One2one bought license for D ? 4 billion, and Orange license E for ? 4. 1 billion. (The ESRC Centre for Economic Learning and Social Evolution) In 1984, the UK government privatised the telecommunications industry, and established Oftel (now OFCOM), the UK telecommunications regulator.

The regulator ensures the market remains competitive, and recently put pressure on the market to reduce prices for calls between networks. (BT’s history, btplc. com) Economic Mobile telephony accounts for 2. 3% of the UK’s GDP, and for ? 15 billion per annum in tax. (O2, Media Centre, 2004) The mobile phone sector is a major employer, “employing nearly 200,000 people” (O2 CSR, 2004), and the UK’s economic upturn through the 1990’s boosted consumer confidence, helping the industry grow. Mobiles are a non-essential luxury good, whose demand will be relatively income elastic, so levels of disposable income are an important economic factor.

A further economic consideration is interest rates, which determine the cost of consumer credit, and therefore have a bearing on customer’s propensity to spend on mobile products. Social There are a number of social factors affecting the environment for mobile phones. Usage of mobile telephones and penetration into the market has increased most notable amongst the 55+, C2DE social grades and middle income groups since 2000. (Oftel, 2003) Equally, there has been a considerable increase in the use of mobile phones by the young.

There is often a social split between those who undertake monthly contract agreements, for which a credit cheque is necessary, and those using unregistered pre-paid services – often the young and the poor. (Jon Agar, 2003) Phones are increasingly being seen as fashion items rather than merely a means of communication. In the 1980s mobile phones were aimed “squarely at business people. However, now it has become the universal accompaniment of old and young alike” (Jon Agar, 2003). There has been a corresponding change of emphasis towards fashionable design, including the ability to customise handset casings and colours.

The increasing numbers of non-business users, especially amongst younger age groups, has prompted a change in the method of communication between users, with SMS increasingly taking precedence over voice calls. (Nokia, nokia. com) As mobile handsets become more advanced, networks are being forced to address the concern that children will be exposed to inappropriate material such as pornography and gambling via their telephone. The network providers are committed to the use of age verification software to try and prevent under-age users accessing this material. (BBC News 2nd July 2004)

Read also: TMobile SWOT Analysis

The mobile industry is fuelled by technological change, and which played an enormous part in its growth since 1985. There has been a recent move away from the basic functionality of handsets to incorporate more advanced features, such as MMS (multi-media messages), digital cameras and the ability to capture video. This is seen as a key growth area by both handset manufacturers and network providers alike. In an increasingly mature market, with high penetration levels, technical change becomes more important as networks seek to provide additional services, and handset manufacturers seek to further differentiate their products.

The technology present in mobile handsets is constantly being upgraded, and consequently the products have short product life cycles, leading to rapid obsolescence. To cater for the business market, handset manufacturers are increasingly adding e-mail facilities and the incorporation of traditionally PC based functionality. The adoption of 3G networks marks a considerable technological step, allowing for broadband internet and video calls. Legal There are a number of legal considerations surrounding the mobile phone industry, one of which is the current health concern linked to the use of handsets, and proximity to transmitter base stations.

The 2000 Stewart Report, set up by Department of Health, found that exposure to radio frequency radiation at levels below existing guidelines, did not cause adverse health effects. (Jon Agar, 2003) However, new research by Stewart announced in January 2005, recommends that Children under the age of 8 should not use mobile phones. This has prompted MyMo, a company specialising in the production of a handset aimed at 4-8 year olds, to stop production (BBC News 11th January 2005). Research in this area is ongoing and has led to bad publicity for the industry.

Another health and safety law was implemented in 2004, preventing the use of mobiles whilst driving, increasing sales of hands free kits. OFCOM, the UK mobile phone industry regulator, has the role of ensuring that healthy competition is maintained in the telecommunications industry and could potentially intervene in the market. (BT’s history, btplc. com) Planning law has also been a key issue for network providers when locating base station transmitters. The most ideal locations are usually in highly populated areas, and have been denied planning permission on the basis they are unattractive. (BBC News 14th January 2005)

Calculate the price
Make an order in advance and get the best price
Pages (550 words)
*Price with a welcome 15% discount applied.
Pro tip: If you want to save more money and pay the lowest price, you need to set a more extended deadline.
We know how difficult it is to be a student these days. That's why our prices are one of the most affordable on the market, and there are no hidden fees.

Instead, we offer bonuses, discounts, and free services to make your experience outstanding.
How it works
Receive a 100% original paper that will pass Turnitin from a top essay writing service
step 1
Upload your instructions
Fill out the order form and provide paper details. You can even attach screenshots or add additional instructions later. If something is not clear or missing, the writer will contact you for clarification.
Pro service tips
How to get the most out of your experience with MyhomeworkGeeks
One writer throughout the entire course
If you like the writer, you can hire them again. Just copy & paste their ID on the order form ("Preferred Writer's ID" field). This way, your vocabulary will be uniform, and the writer will be aware of your needs.
The same paper from different writers
You can order essay or any other work from two different writers to choose the best one or give another version to a friend. This can be done through the add-on "Same paper from another writer."
Copy of sources used by the writer
Our college essay writers work with ScienceDirect and other databases. They can send you articles or materials used in PDF or through screenshots. Just tick the "Copy of sources" field on the order form.
See why 20k+ students have chosen us as their sole writing assistance provider
Check out the latest reviews and opinions submitted by real customers worldwide and make an informed decision.
Business and administrative studies
excellent work
Customer 452773, March 12th, 2023
Business and administrative studies
Thank you for your hard work and help
Customer 452773, February 21st, 2023
Business and administrative studies
excellent job!
Customer 452773, May 25th, 2023
Human Resources Management (HRM)
Customer 452773, July 11th, 2023
Business and administrative studies
Customer 452773, February 23rd, 2023
Impressive writing
Customer 452547, February 6th, 2021
Looks great and appreciate the help.
Customer 452675, April 26th, 2021
Human Resources Management (HRM)
Customer 452773, June 25th, 2023
Business Studies
Thank you very much for a good job done and a quick turn around time.
Customer 452615, March 31st, 2021
Leadership Studies
excellent job as always
Customer 452773, September 2nd, 2023
Social Work and Human Services
Although it took 2 revisions I am satisfied but I did receive it late because of that.
Customer 452603, March 25th, 2021
Customer 452591, March 18th, 2021
Customer reviews in total
Current satisfaction rate
3 pages
Average paper length
Customers referred by a friend
15% OFF your first order
Use a coupon FIRST15 and enjoy expert help with any task at the most affordable price.
Claim my 15% OFF Order in Chat

Sometimes it is hard to do all the work on your own

Let us help you get a good grade on your paper. Get professional help and free up your time for more important courses. Let us handle your;

  • Dissertations and Thesis
  • Essays
  • All Assignments

  • Research papers
  • Terms Papers
  • Online Classes
Live ChatWhatsApp