Scos Case Report

ain Problems

There are several critical issues SCOS is faced with: how to position itself in the extremely competitive marketplace, to assert its leadership in research and development, and to gain higher revenue in the short term.

The SIM card market environment:

As China’s economic was flourishing, there is more investment its national communication infrastructure and technology backbone. Consequently, the domestic demand for new products and technologies is expanding and the SIM card marketing has been growing rapidly. The SIM card market is become bigger for new products and services.

Potential customers in this market contain China Mobile Communication Corporation (CMCC) and China United Communication Corporation (UNICOM), each of them dominates 72% and 28% market share separately. They are preferring supplier who are providing post sales service, technical support, technology consulting and reliable deliver. China Telecom and China Netcom are two new entrants to the mobile operator field; aim to expected to receive 3G licenses by 2004.

Product could be categorized as high-end and low-end, each has different buying criteria. The high-end SIM card requires customized card design and quick time to market while the low-end product just require some basic functions. Additionally, the new functions and features of SIM card are required to support the new applications in end-users’ mobile.

Competitors: Mass, Plus, Comea and Anta are four of the most competitive rivals in the SIM card field, each of them posses some specialized strength, regarding the preference of the costumers are post sales service, technical support, technology consulting and reliable deliver.

SCOS’ strategy constrains: Low capability, less financial and human resource, no differentiates among the competitors in the market of low-end SIM card are the main problems in SCOS’ decision making. Even though the investment in research an development in new technology is successful, the wrong judgment of the market demand may lead company to a dangerous place.

Possible Solutions:

SCOS may consider selecting the low-end SIM card market as its target segment by accepting the order from both CMCC and UNICOM. This strategy would bring profitable revenue to SCOS and help to satisfy is investor and partners in a short term. Also, it can fill the capability of SCOS’s manufacturing supplier and earn some experiences with SIM card manufacturing. However, if SCOS putting all effort in producing low-end SIM, it may lost its advantages in the capability of high technology research and development and lost the chance to become leader in high-end SIM card market. Also, the low production capability is likely to fail to provide the reliable deliver and consequently disappoint the