Porter's Five Factors And Complications Of The Smartphone Industry

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The breakthrough of the smartphone industry is revolutionary to say the least. It is safe to say that we have developed a culture of smartphone dependence, ever since the smartphone industry emerged in 2007. In 2012, industry leaders; Apple, Android, Samsung, and to a certain extent Blackberry have made astonishing profits. Although the sales of these tech giants are undoubtedly impressive, they are not an indication of profit potential, so what is the profit potential of the industry in 2012? By using Porter's five forces model, we can conclude that the profit potential for the smartphone industry is moderate.
Porter's five forces model include the threat of new entrants, the threat of suppliers, the threat of buyers, the threat of substitutes, and inter-firm rivalry. The higher the threat level, the more challenging it is to compete in an industry. Firstly, the threat of new entry is moderate due to factors that shape the force. The first factor is a low capital requirement for the industry, which leads to a high threat level, partly thanks to Google's open source operating system "Google's business model allows it to give its Android OS away for free to any manufacturer that
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One of the most significant factors is differentiated industry products, threat of entry is low when product differentiation exists which it does in the smartphone industry. Apple, Android, Samsung, and BlackBerry all have distinct products that resulted in consumer brand loyalty "In essence, they had built what was considered the best and most secure email service available. They also had a cultivated a cult following among customers­-so much so that some began to refer to the BlackBerry as a "CrackBerry,""(Burr et al., Make or Break at RIM(in2013):Launching BlackBerry 10). The fact that buyers face low to no switching costs provoke a high threat level, which leads us to the substitutes force of the Porter's

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