Discussing Optus' Competitive Market Position by Using Porter's Five Forces Model

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Discuss Optus' competitive market position by using Porter's Five Forces Model

This essay will discuss Optus’ competitive market position through the analysis of Porters Five Forces Model. Optus, Australia's second largest telecommunications company is situated in a constantly changing environment, easily illustrated by Porters Model. Introduction of Porters Five Forces Model Porters Five forces model is an analytical tool developed by Michael E. Porter in 1979 whilst he was studying at Harvard Business School. Understanding Ports Five Forces brings to light an industry’s current profitability and develops a framework for making educated calculations for anticipating and influencing the competition. Porter wished to create a
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With an understanding of Porters Five Forces Model, Optus' competitive market position becomes a simple concept to visualize.

Degree of Rivalry Rivalry is the first force to consider when analysing the competitiveness of a market. Though considered important, it is crucial to understand that the degree of rivalry is only one of the five forces that influence the competitive state of the market. Profitable markets constantly attract new firms which impacts the overall profitability of the market. Optus is one of the largest telecommunications companies in Australia, second only to Telstra, making up thirty-three percent of the industry. As a significantly large employer of 10, 500 employees and serving 8 million customers, Optus provides a strong degree of rivalry towards the rest of the competition. However, like smaller telecommunications companies, it must depend upon Telstra's infrastructure in order to provide its customers with the quality and support that it advertises. This puts Optus at the mercy of Telstra's behavior resulting in a less than ideal position. When this contract is broken, it may lead to subtle sabotage and other illegitimate activities. The degree of Rivalry is a primary force experienced by all companies in a competitive market. Despite being a major player in the telecommunications sector, Optus must rely upon its largest rival in order to provide

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