Threat of new entrants Low The initial cost to be incurred when entering the telecommunication industry is high due to expensive machineries and expensive site sharing expenses where two service providers share the same telecommunication sites. In addition, TRC has enacted a law from stopping any new service providers from entering the telecommunication industry.
Due to this legal barrier it can be concluded that barriers to enter the telecommunication industry is high. Bargaining power of buyers Medium In Sri Lanka, demand of the customers are not taken in to account when setting the call charges. The telecommunication charges are mainly determined by the Telecommunication Regulation Commission Sri Lanka (TRCSL), therefore the customers cannot impose a pressure on the service providers. But the customers do have the option to switch from one service provider to another since the switching cost is reallly low in the telecommunication industry therefore the quality is of high importance in retaining the users. Dialog has been able to provide customers with high quality service. Threat from substitutes Low There is no alternative to mobiles in Sri Lanka, even if it is VOIP over wireless technology yet internet service is provided by the telecommunication service providers.
Fixed line connections are not considered to be a substitutes in Sri Lanka due to the immobility of such technology. Dialog has even a subsidiary which has CDMA license in Sri Lanka along with some other operators Bargaining power of suppliers Medium There are limitations for setting sites that provide signals. Dialog and other telecommunication service providers share the towers and they pay and set of the revenue and expenses against each other. The equipment providers are limited therefore the power that they have over the price at which tower equipment are high Rivalry among competing firms High In Sri Lanka, mobile operators are in a quality and other service driven competition where firms are coming up with services to make customers lives easier. In addition, they come up with loyalty packages.
Since price is not in the hands of mobile operators they often come up with features such as enabling users to book movie tickers, e channeling, and mobile banking. in addition, they come up with mobile applications. Dialog AxiataPlC is known for its innovations in Sri Lanka