Give my phone calls back – the crisis of tele companies

18

September

2019

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Do you still remember the days when you need to pay tons of money for only 100M mobile data and the connection is super slow? Well, I can still remember the torture of waiting for the picture on my phone to appear one pixel by one pixel back in primary school. Lucky for us, it is no longer a problem.

From only 2008 to 2010, the price per MB in the US has dropped from 0.47 USD to 0.05 USD while the speed increased greatly, which means we now have better, faster and cheaper data, as well as other telecommunication service than any time before. The revenue of telecom companies in Europe has dropped 24% from 2007 to 2018.

Their life was pretty good, until applications came into the playground, applications such as WhatsApp and Messenger. Unlike traditional telecommunication operators, those applications and their parent companies do not need to invest heavily on any infrastructures, instead, they rely simply on the network offered by traditional telco companies while offering people a side way to pay less: forget about phone calls and SMS, just come and use online voice calls and messages. Customers love it. Those telecom giants, though, did not feel too good. The emergence of online communication APPs degraded them into infrastructure operators and suppliers by breaking their value chains so that they can no longer rely on the income of users making phone calls and sending messages.

What is worse, it is not just about communicating, the same goes with many other business the telecom companies are in. For example, cable/ wireless TV is threatened by YouTube, Netflix, and even Twitch.

One interesting thing is that some of the telecom companies are trying to cooperate with different applications to somehow win the market back. China Mobile, for example, offers customers different special unlimited data bundles. It categorizes popular APPs based on their developing companies or types (for example, combine Twitter, Instagram, Facebook and WhatsApp together as a social media bundle). In this way, it can develop a more profound relationship with the APP developing companies and thus rejoin the value chain process again.

The example above offers an interesting perspective of how those traditional telecom companies trying to survive the technology disruption. If they want to stay on the stage, they might need to think a little bit harder and act quickly.

 

 

Reference:

Entner R. (2011). What is the price of a megabyte of wireless data. https://www.fiercewireless.com/wireless/entner-what-price-a-megabyte-wireless-data

Fonseca M., et cl. (2019) Telecom operators: Surviving and thriving through the next downturn. https://www.mckinsey.com/industries/telecommunications/our-insights/telecom-operators-surviving-and-thriving-through-the-next-downturn

Frisiani G., Jubas J., Nattermann P. (2017) Hello, mobile operators? This is your age of disruption calling. https://www.mckinsey.com/industries/telecommunications/our-insights/hello-mobile-operators-this-is-your-age-of-disruption-calling

Bell Venture. Bye Bye, Monopoly. How digital is disrupting the telecommunications industry – Top 4 trends. https://bell.ventures/insights/bye-bye-monopoly-top-4-trends-disrupting-the-telecommunications-industry

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Expired food, is charity and garbage bin the only solution?

7

September

2019

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Would you buy food that is expired or almost expired? Probably not. After the concept of expiration date became prevalent, people, especially when buying in supermarkets, have a tendency to avoid those soon-to-expire food. This act, however, leads inevitably to a huge amount of leftover food in supermarkets.

So how much is the amount of food left unsold in supermarkets. For example, in France, there’s annually 0.78m tonnes of food being thrown away by shops. The food waste in Tesco, the British supermarket, for 2018/19 was 44,297 tonnes.

To tackle this problem, the general approach is to work with charities and donate the food to local food banks. But from a management perspective, donating creates the supermarket with no profits aside from establishing a more positive cooperation image. These few years, big retail brands started looking for creative ways to solve the leftover problem.

In the Netherlands, for instance, there is a restaurant called In Stock that works with Albert Heijn to process various unsold blemished fruits and vegetables into dishes so that a greater profit can be generated. Internet, at the same time, also offers the big retailers a solution: a platform on which they can sell all the soon-to-expire food. The Danish application, Too Good To Go serves as a perfect example. Launched in 2016, the application is now working with more than 4000 restaurants and supermarkets in 13 European countries.

But the most effective method for supermarkets would not be trying to figure out what to do with all the leftover, but trying to create a smarter inventory system that prevents such a large quantity of wastes. An inventory system that ideally can estimate the detailed sales performance in each brand. In order to achieve this, supermarkets need not only a powerful and advanced management system, but also detailed information about their customers and customers’ purchasing history, which might or might not be a challenge to them.

Sources:
The Guardian. French law forbids food waste by supermarkets. Derived from: https://www.theguardian.com/world/2016/feb/04/french-law-forbids-food-waste-by-supermarkets

Kor Y. (2017). How Large Food Retailers Can Help Solve the Food Waste Crisis. Derived from: https://hbr.org/2017/12/how-large-food-retailers-can-help-solve-the-food-waste-crisis

Calderbank M. (2017). Ever wondered what happens to all that unsold food at your favourite supermarket. Derived From: https://www.gloucestershirelive.co.uk/whats-on/shopping/ever-wondered-what-happens-unsold-810208

Loritz M. (2019). Copenhagen-based app Too Good To Go raises a further €6 million to eliminate food waste. Derived From: https://www.eu-startups.com/2019/02/copenhagen-based-app-too-good-to-go-raises-a-further-e6-million-to-eliminate-food-waste/

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