A comparative analysis of the internationalization process in the telecommunication industry

Abstract

Internationalization is widely occurred all over the world in every field. The telecommunication industry is also not an exceptional case. However, the processes of internationalization are quite different from company to company, and different processes derive the huge gap of internationalization level between companies. The internationalization process that this paper deals with can be summarized into two types. The first type is incremental approach of internationalization which is widely referred to Uppsala model. It proposes that firms involve into foreign markets sequentially through different stages as they gain market knowledge gradually and reduce uncertainties. (Johanson and Wiedersheim-Paul, 1975; Cavusgil and Nevin, 1981; Cavusgil, 1984; Burton and Schlegelmilch, 1987; Johanson and Vahlne, 1977). The second type is accelerated internationalization model which is known as Born Global Firms. The born global firms are the business organizations that from the inception, seek to derive significant competitive advantages from the use of resources and the sale of outputs in multiple countries (Oviatt & McDougall, 1994, p. 49)(e.g. Autio, Sapienza, & Almeida, 2000; Knight & Cavusgil, 1996; Rennie, 1993)`` This paper discusses a case study of two telecommunication companies which represent two types of internationalization process, respectively. Based on the analysis of domestic market situation, both companies are situated at the very similar level within their domestic market. However, the internationalization process that each company chooses resulted in the huge gap of internationalization level. Based on this research, in order to penetrate global market successfully, Born Globals model of internationalization is preferred. Specifically, this is internationalizing service while their domestic market service is not fully developed. It is quite late to launch their internationalizing service after their domestic market is in the mature stage.