AT&T TOWS Analysis: The Network of the Future

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Based on PESTEL and SWOT analyses, it is possible to conclude that the most significant issues of AT&T are emphasis on the US and highly competitive environment. Nevertheless, the examination also highlighted several opportunities, including the impact of international growth and the focus on sustainable development. These factors are particularly significant due to the recent trends of globalization, digitalization, and sustainability in practically all industries (Olawumi & Chan, 2018). The customers prefer eco-friendly products from organizations that care about the environmental situation and are ready to provide their services worldwide. Consequently, clients favor convenience that could be achieved by applying contemporary smart technologies and digital advancement. Based on these opportunities, it is possible to define several solutions to the relevant problems of AT&T.

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TOWS Analysis

From these considerations, it is essential to conduct the Threats, Opportunities, Weaknesses, and Strengths (TOWS) analysis. This method allows determining possible solutions to the problems by connecting all of the said factors. For instance, the combination of opportunities and weaknesses defines a strategy that could be used to mitigate weaknesses by choosing to pursue opportunities. The TOWS analysis of AT&T and the following elaboration are presented below:

Table 1. TOWS Analysis.

TOWS Strengths Weaknesses
Brand value Large economic debts over the last year
Infrastructure of wired and wireless communications Emphasis on the USA
Opportunities
International growth Brand value & International growth – Expansion Debts & International growth – Long-term Investments into Geographic Expansion
Sustainable development Brand value & Sustainable Development – Replacement of Older Technologies
Threats
Highly competitive environment Competitors & Infrastructure – Focus on 5G and Digitalization Competitors & Debts – Innovative Streaming Policies and Sales of Unnecessary Assets

Competitors & Emphasis on the USA – HBO Max Expansion

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The depicted TOWS matrix highlights four primary strategical approaches: strengths to maximize opportunities, strengths to minimize threats, opportunities to minimize weaknesses, and strategies to minimize both weaknesses and threats. Therefore, the chart does not explicitly define the most appropriate course for the development; however, it provides a list of possible solutions. As a result, it is essential to brainstorm the presented data and analyze each of the combinations.

Brand Value & International Growth

One of the safest ways for AT&T to gradually improve its position in the market of telecommunications is via expansion of services. At present, AT&T is one of the leading companies in the industry and operates under three primary segments: communications, WarnerMedia entertainment and streaming services, and Latin America (Reuters, 2021). While the company lost some of its revenue in 2020, its advantageous position in the market cannot be denied. As a result, it is possible to allocate the finances into the development of international services and consequent expansion to other regions. At present, the Latin America segment provides approximately 3% of the total revenue with 11 million subscribers (Wall Street for Main Street, 2021). The scale of the earnings might hinder the company from spreading to European and Asian markets; however, subjectively, international expansion is a profitable course of action.

Brand Value & Sustainable Development

At present, AT&T has already put significant efforts into sustainable development, including environmental, social, and economic aspects, which explains the highest score in the SFAS chart. Furthermore, sustainability is a crucial component for every organization’s success due to the ongoing trends (Olawumi & Chan, 2018). In its vision, AT&T addresses GHG emissions, education, diversity, inclusion, and even political engagement (AT&T, 2021). Nevertheless, at present, the number of eco-friendly sources for energy consumption is merely 18%, while other tech companies, such as Google or Intel, are approaching a 100% mark (GlobalData Technology, 2021). In other words, while the objectives of AT&T align with sustainable development, there is much work to be done concerning its current assets. Ultimately, it is essential to review the existing technologies and replace them with innovative and eco-friendly options.

Large Economic Debts & International Growth

As mentioned in the SFAS analysis, AT&T is struggling with long-term debts, which have increased drastically in 2020. Some of the reasons for the unprofitable financial year include the purchase of DirecTV and the shutdown of the movie business due to pandemic restrictions (Sun, 2020). Subjectively, one of the ways to mitigate these consequences is the geographic expansion to European and Asian markets. Evidently, this course of development might significantly obstruct the current revenue of the company and increase the short-term debt by a large margin. Nevertheless, the finances of the organization allow for a brief disruption of revenue growth since the primary debt problems are long-term.

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Highly Competitive Environment & Large Economic Debts

The economic debts of the company have been gradually increasing over the last few years, which can be connected to the high competitiveness of the market and the pandemic restrictions. As mentioned briefly before, the purchase of DirecTV and emphasis on the pay-tv were highly unprofitable for the organization, and the shift to streaming services is needed (Sun, 2020). Furthermore, it is essential to improve the existing streaming platform – HBO Max – since many competitors, such as Netflix and Apple TV Plus, consistently offer innovative solutions.

Highly Competitive Environment & Infrastructure of Wired and Wireless Communication

One of the most notable AT&T’s advantages in the technological advancement is 5G. 5G is the fifth-generation mobile network, which allows increasing the connection speed and reducing latency (Bajenescu, 2020). Compared to LTE, 5G has a large number of advantages and is particularly effective for video-streaming support and other types of entertainment (Bajenescu, 2020). From these considerations, AT&T should focus on the development of the network and prioritize technological research.

Highly Competitive Environment & Emphasis on the USA

As mentioned briefly before, AT&T has a large number of competitors in every segment of operations. T-Mobile and Verizon are offering better 4G solutions, while Netflix and Apple TV present a considerable danger to HBO Max. While the importance of telecommunication expansion is described in previous solutions, streaming platforms need to be introduced to the international arena as well. At present, AT&T plans to roll out HBO Max in Europe (Middleton & Easton, 2020). Nevertheless, it is essential that the company focuses on other regions as well.

Suggested Implementations

While all of the mentioned strategies might be effective to a certain extent, emphasis on 5G development and consequent improvement of streaming services seem like the most appropriate choices for AT&T. While it is complicated to predict the exact relevance of 5G in the near future, it might solve the primary problems of the company, such as debts and competitors. AT&T has good chances of becoming a pioneer in the development of 5G networks and maintain its place as the leading distributor of services. Furthermore, the improvement of HBO Max in terms of both innovative features and geographic expansion might underline its competitive advantages. In the dense market of streaming platforms, it is essential to continually evaluate the preferences of customers and act accordingly.

References

AT&T. (2021). Measuring our impact: 2020/2021 progress toward our goals. Web.

Bajenescu, I. T. –M. (2020). 5G: The network of the future. Benefits and perils. Electronica, 68(3), 75-79. Web.

GlobalData Technology. (2021). AT&T and Verizon showcase approaches to environmental strategy. Web.

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Middleton, R., & Easton, J. (2020). WarnerMedia reveals HBO Max global plans, as streamer gains studio’s movie slate. Web.

Olawumi, T. O., & Chan, D. W. M. (2018). A scientometric review of global research on sustainability and sustainable development. Journal of Cleaner Production, 183, 231-250. Web.

Reuters. (2021). AT&T Inc. Web.

Sun, L. (2020). Cant AT&T’s new CEO solve its 3 biggest problems? Web.

Wall Street for Main Street. (2021). AT&T: Missteps and pessimism lead to an attractive entry point. Web.

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