Management/Organizations & Careers/Workforce Issues

Telecomsfilledwithcheese.com (2010) discussed the great work of Juan Villalonga Navarro who is CEO of Telefonica: “CEO took Spanish telecommunications company Telefonica private and helped it become the second largest telecommunications company in the world and the largest in Spain with over 252 million customers. Another thing Navarro undertook during his time was globalizing and diversifying the company”. It was his leadership that makes Telefonica a smart investment. Juan Villalonga Navarro took risks as a CEO (Telecoms, 2010) and it was those risks to expan5d and grow the company that paid off greatly for the employees and employers. Navarro, as a CEO, took advantage of those opportunities, risked high and benefitted well because of it.

Companies right now are all expanding in respect to a macro perspective but when looked at on a micro level there is evidence of job cuts. Although companies like Telefonica are cutting jobs (Roman, 2011) this does not mean that they are still not expanding. Roman discusses why Telefonica has chosen to cut employees in Spain and gives the reasons to be a result from their investments in Spain (Roman, 2011).  The company sees a greater opportunity in South America and is investing more into that geographical region because of it.  Employees and potential employees are all benefiting from company investments like Telefonica that are being made.

Randell Jenkins (2011) writes on statistics showing how in the current state of the economy it is good to be a potential telecommunication employee: “A report on CNNMoney.com stated that websites specializing in job search have indicated that telecommunication job opportunities have jumped 400% over the last three years, and younger individuals seem to be inquiring more about these telecommunication opportunities which offer more flexibility.”  The expanding market would make sense for these jobs to boom. People are unemployed and need to use telecommunication services to find potential job opportunities. Companies need to save money by replacing employees with telecommunication services. Telecommunications can eliminate unnecessary spending for a company and allow a company to increase productivity. 

Roman, David, 2011. 3rd UPDATE: Telefonica Targets Brazil Growth, May Cut Staff In Spain http://online.wsj.com/article/BT-CO-20110414-706301.html

Fortune 500 2010: industry: telecommunications. (2010, May 3). Retrieved from http://money.cnn.com/magazines/fortune/fortune500/2010/industries/157/index.html

2010, The Top 10 Best CEO’s in the Telecom Industry, http://telecomsfilledwithcheese.com/2010/03/15/the-top-10-best-ceo%E2%80%99s-in-the-telecom-industry/

Promising Foreign Telecommincations Stock Buys

While the AT&T purchase of T-Mobile may be the talk of the town, telecommunications companies in developing countries offer promising stock “buys”.

The first stock to consider is Telefonica (TEF). Frank Constantino (2011) recommends Telefonica because its stock is cheap, but has a lot of potential (p. 1). Telefonica’s attractive price is partially the result of the debt crisis in its home country of Spain (Constantino, 2011, p. 1). While the company’s stock price may partially be the result of events in Europe, the company’s expected growth is predicted to come from its operations in the developing nations of Latin America (Constantino, 2011, p. 1). According to a late composition in Barron’s, out of Telefonica’s 220 million wireless customers, 150 million of those customers are in Latin America (as cited in Constantino, 2011, p. 1). In terms of financial statistics, “the company has grown earnings at an annualized rate of more than 20% over the last five years. Revenues have also been strong, growing at an annualized rate of 10% over the same period” (Constantino, 2011, p. 1).

Information obtained from:

http://seekingalpha.com/article/257421-telefonica-could-ring-up-big-profits-for-investors

Millicom International Cellular SA (MICC) is another European stock investors may want to purchase. John Reese (2011) points out that “Millicom provides prepaid cellular telephone services to more than 30 million customers in 13 emerging markets in Latin America and Africa (Millicom International Cellular SA, para. 1). The strategy behind the success of Millicom is its presence in places where a growing demand for telephone services, caused by economic growth, has proven current telephone services to be insufficient (Reese, 2011, p. 1). The financial statistics for Millicom are attractive with a $10.6 billion market cap, a return on capital close to 70%, and an earnings yield of 17.7% (Millicom International Cellular SA, para. 2).

Information obtained from:

http://seekingalpha.com/article/262646-guru-inspired-picks-for-a-telecom-bounce-back

*Please note: APA citation style in above paragraphs may need to be changed

Innovation for cars and computers by being better connected.

Microsoft and Toyota have recently paired up for a new marketing platform.

Q: What do they want to do?

A: Connect your home phone, smarthphone, and car; all by telecommunications.

Customers of Toyota and Microsoft products will be able to look forward to improved and new experiences as car owners. "Imagine using this platform to regular your vehicle’s temperature from the phone, or even check your car’s battery level remotely while optimizing the process of charging the car whenever it is cheaper to do so", Edwin Key wrote (http://www.ubergizmo.com/2011/04/microsoft-toyota-team-up-for-automotive-telecommunications-platform/). Consumers can know, from anywhere they are, how their car is currently. Do they need to recharge it? They can even control a number of components by a cell phone. Depending on how the cell phones can interact with the car, maybe driving and fiddling with car temperature/music will now be safer. All customers of hybrids and electric cars can expect this to be a part of their life in 2012, once all of these options hit the market. 

An interesting point about this new relationship is in the B2B and B2C services that are happening. The two businesses are not only contracting with one another but consumers are also benefiting from this new partnership. A positive in the relationship is that it will also promote potential consumers to buy ecologically friendly vehicles. With an increasing emphasis on being "green" the telecommunication relationship should benefit the two businesses and the planets ecosystem.

With the help of telecommunications and advancing technologies we can expect to have more relationships between two businesses be established based on telecommunications. 

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http://www.ubergizmo.com/2011/04/microsoft-toyota-team-up-for-automotive-telecommunications-platform/

2011 a good year for stocks

With the government injection led general recovery of the economy+ the ambitiously growing but incredible institutional stability of the big telecommunications in the industry 2011 should be a great year for stocks.

To start with, we should note that from the 12 highest-yielding companies in Standard and Poors 500 stock index 5 companies are telecoms. Telecom stock dividend paying yields range from 5% to 7% and are among the highest and safest in the market. However, although telecom companies in general are generous dividend payers, it should be noted that the landlines sector of the industry is losing clients and does not seem to have any kind of aggressive growth prospects. On the other hand the wireless sector of the industry continues to attract new customers and increase its market penetration to even superior levels of 100% through innovative new technologies that enable wireless providers to provide new services and attain new customers and more subscriptions from already existing customers.

For example some of the most efficient Telecom stocks out in the market are:

RIM ( Research in Motion)

RIM growth prospects can be seen as a firmly structured company ready for long term growth. for instance: earning per employee for the past two months has been $194,917. Revenue per employee for the past two months has been that of $1,137,556.

Another example of efficient stock is Loral Space & Communication

Earnings per employee was $184,119 for the last 12 months. Revenue per employee was $1,121,408 for the same period.

Revenue and earning per employee are good indexes to measure the efficiency of the company, thus the quality of stock an investor is buying

The future of telecom companies in security markets depends on their financial strength, efficiency and ability to attain aggressive growth. It seems for now that the best Telecom stocks will be that of companies that have the sufficient market penetration to realize the application of new technologies and it should be remembered that new technology comes without wires

April 11th– Securities Markets

April 11^th– Securities Markets

·         In general terms, what do the industry analysts say about this industry?

The US government is beginning to spend vast investment to upgrade the entire economy. . According to the analysts John.M(2011) in Mckinsey&company,  "there will be hug investment on telecommunication sector to boost economy such as making infrastructure, investing R&D part, and tax benefits." By joining the ongoing environment, analysts predict that  telecommunication will continue its dynamic force. Especially, James M, the telecommunication analysts in Mickensey(2010), predicts "huge boom in telecommunication market to meet needs of customers who want high-qualified services such as smartphone."

·         What are industry analysts predicting in terms of prospects for growth in the industry?

Some main perspectives lead the industry’s growth in the future market. Desire for connecting with society. Recently, more and more people are interconnected by social networking service provided by smartphone compared to the face to face connection before. Facebook, Twitter, and My space are leading the trends based on ubiquitous technology, which can realize this phenomenon. In brief, desire for building new connection on wireless device is causing growth.

The other one is that emerging of related market.With the progress of mobile technology, it goes  huge profit in the market. "Applications for mobile devices have emerged as hot new accessories to mobile phones and have become an additional differentiating feature that continues to prevent mobile service from becoming a commodity product"(James Moorman, 2011) According to the his opinion, Applications are widely covering from navigation, entertainment to sports' facilities, and definitely it earns huge benefit, opening new blue ocean market.  

To be specific, Apple is leading company among applications market and, according to IDC, "Apple remains in control, hitting the 300,000 applications mark in October 2010. Android’s adoption by multiple vendors has started to produce benefits, as the platform boasted over 100,000 apps in November 2010."
references


Eileen M. Bossong-Martines,2011,   Standard & Poor’s Industry Surveys  This is from WSJ issued by 11^th March 2011 connected by official site of standard &poor’s


CDMA Development Grouo, (2011) GSM Association ; IEEE, This is from GSM association statistics released by NewYork Times online


James Moorman, 2011, industry surveys : telecommunication wireless, standard and poor's
John.M, 2011 , Telecommunication sector, mckinseyquarterl, www.mckinseyquarterly.com/Telecommunications/Strategy_Analysi

Global Telecomm Revenues

Revenues in the Telecommunications industry have experienced strong growth over the past years. Before the 2008 financial crisis almost every company in the industry experienced double digit growth in both revenues and market penetration. This trend has not only been seen in North America, but also in almost every single market in the world with the Asia Pacific Region being the strongest growth force. In 2008 the Telecomm market in the Asia Pacific region surpassed the long standing biggest telecomm market of North America in both profits and market penetration. For example market penetration in Hong Kong was already of 119% in 2005 while market penetration in the United States today is about 93%.

During the recession in 2008, telecommunication companies did not suffer; both their revenues and subscribers increased at very positive levels although not at a double digit rate. It is clear that Telecommunications have become such a vital aspect of human life that customers widely consume telecomm services even in the harshest economic conditions. Global telecommunication revenues surpass $5 trillion today.

In the U.S, verizon on its own reported a revenue of $23.8 billion as of 2006. Verizon growth of 15% growth was powered due to the incresing demand for wireless services and fiber based internet.

Revenue and Profits in Telecom

AT&T is an industry leader in both revenue and profit according to a May 2010 report by cnnmoney.com (Cable News Network[CNN], 2010). The website reports that in 2009, AT&T reported $123,018 million dollars in revenue and $12,535 million dollars in profit for the year (CNN, 2010). AT&T has climbed up to its current position through a combination of successful corporate strategies. AT&T’s purchase of BellSouth Corp. was a strategic move that enabled the company to successfully grow to its current size. Despite the company’s increased size, Todd Rosenbluth (2010), of Standard & Poor’s, points out that AT&T still saw revenue losses from its voice access lines (p. 6). In order to make up for these losses, the company has funneled more resources into increasing its wireline data revenues (Rosenbluth, 2010, p. 6). While wireline operations may be onerous for AT&T, wireless operations have been a source of success for the company. Rosenbluth (2010) asserts that AT&T’s ability to increase its number of customers is partially the result of smartphone sales, including the iPhone (p. 6).

Verizon is another strong player in the telecommunications industry. The company states its revenues to be $107,808 million dollars and its profits to be $3,651 million dollars as of 2009 (CNN, 2010). Verizon’s success is derived in part from its purchase of ALLTEL Corp., America’s fifth largest wireless provider, in 2008 (Rosenbluth, 2010, p. 6). The increase of customers Verizon experienced from its acquisition of ALLTEL made it the largest wireless provider in the United States (Rosenbluth, 2010, p. 6). In addition to success in its wireless operations, Verizon has increased its revenues by enlarging its broadband base through the installation of fiber-based broadband and video services (Rosenbluth, 2010, p. 6).

Sprint Nextel is a key telecommunications player with one of the largest revenues, while at the same time having the largest profit loss in the U.S. telecommunications industry (CNN, 2010). The company reported making $32,260 million dollars in revenue in 2009 (CNN, 2010). Despite this, they posted a $2,436 million dollar loss in profits for the same year (CNN, 2010). James Moorman, of Standard & Poor’s, proposes several factors that could have led to this outcome. Moorman (2011) points out that customer loss could have been caused by unattractive handsets, unsatisfactory customer service, and confusing rate plans (p. 2). Moorman (2011) further mentions that Sprint Nextel is operating two different networks, one being Nextel’s troubled integrated dispatch enhanced network (iDEN) and the other being Sprint’s code division multiple access (CDMA) network (p. 2). The fact that Sprint Nextel is operating two networks is significant because two networks are more expensive to run than a single network (Moorman, 2011, p. 2).

April 4th– Accounting and Financial Statements

April 4^th– Accounting and Financial Statements

·         Comment on revenue, profit, and loss of key industry players?

·         How has the recession (2008-2009) affected companies’ balance sheets?

            

April 4^th– Accounting and Financial Statements

·         Comment on revenue, profit, and loss of key industry players?

·         How has the recession (2008-2009) affected companies’ balance sheets?

              

In my perspective, alth0ugh the unstable state of the US economy, the worldwide telecommunications industry will be expected to continue expanding over the upcoming years as continued spending by consumers and businesses for wireless services, especially in emerging markets, drives industry revenue growth. According to the new industry market study conducted by http://send2pressnewswire.com ,“telecommunication services revenues on a worldwide basis are expected to grow at a compounded rate of nine percent over the next five years, bringing the sum spent globally on telecommunications to $25.6 trillion by 2016”. Besides, in my personal view, wireless makes the powerful showing while wire line follows a distant second. In some extent, last two years’ recession has affected telecommunication industry, but the huge demand of smartphone and its app market have overcome recession at the same time. Thus, although its balance sheet’s liabilities section will be increased at some extension, the industry will overcome the recession and open new market in upcoming years.



reference


Robert, 2011, wordwide  telecommunications industry revenue to top $25.6 trillion over five years, http://send2pressnewswire.com