Verizon Communications SWOT Analysis

{ Posted on Jun 02 2010 by adam | 10,315 views}

Strengths

Verizon Communications is known as the one of the largest providers of wireless as well as broadband communication in America. In America it is available in twenty eight states and has a customer base of 49.3 million.

The employee base of the Verizon Communications is also very large, about 215,000 employees. The large pool of employees is because it is a merger of three large telecom companies. The large number of employees from different backgrounds and having invaluable experience add to the company’s intellectual capital.

The company has four business segments; Domestic Wireless, Domestic Telecom, Information Services and International. From these four segments the company generates an annual revenues reported to be more than $71 billion.

The company offers a variety of wireless and wire line services. The diversification of technology found at Verizon Communications is one of its strengths.

Weaknesses

The Verizon Communications was formed due to merger of GTE and Bell Atlantic companies. The two companies had different cultures and therefore the corporate culture of the company is quite weak. The conflicting beliefs, norms and philosophies within the company are the root cause of many conflicts in the company.

Many of the employees at Verizon Communications are aged and according to reports eighty percent of the workforce has reached their retirement age.

Many of the markets and territories that were previously captured by the three large companies, of which the Verizon Communications is a merger, are still to be consolidated. This leads to uneven distribution of resources and the allocative efficiency of the company has decreased.

Due to different cultures prevailing in the company, there are different processes being followed in different parts of the company. There are as such no standard processes and procedures and the company needs improvement in many of its procedures.

Opportunities

For many years, Verizon Communications has been serving as a local exchange carrier in many areas. For many years the company did not have any competition and has developed a loyal customer base. Also this has given the company a strong position that the other local exchange carriers have to compete with.

The growing communication needs has resulted into potential markets for the company to enter which include local, global, business, government and residential markets. The regulatory restrictions on offering long distance services have now been eased and hence, Verizon Communications can easily expand to distant areas and increase its market shares.

Over the years the Verizon Communications as developed brand recognition and good will. This will facilitate the company to launch new services and products in the future.

Threats

The government regulations and policies are such that they spur competition. One such policy is the regulation imposed on Verizon to lease access lines to its competitors at quite low rates (60 % low) from the wholesale price.

Many wireless and wire line services are now being offered by local as well as global companies. The competition is cut throat and the customers have many available substitutes.

Due to the economic recession all over the world, the customers in order to cut down their expenses are reducing their telecommunications services.

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