The Importance of Telecommunications for Business

Telecommunication services have a robust global market existence that is rapidly growing and is different in various parts of the world. Telecom services differ in both developing and developed countries due to fiber infrastructures, competition and modern technology (Olbeter, 2005). Telecom services have a strong market presence in developed countries like Europe where the high demand for telephone services has made the government increase the number of telephone lines by investing in an infrastructure network. The rapid changes and growth have led to globalisation in the telecommunication industry where different telecom companies merge and operate on an international scale.

Globalization has brought about earnest deregulation of telecom laws in various countries including Europe. However, regulation of joint telecom companies is essential as it helps in solving disputes, protecting consumers, addressing anticompetitive manipulations and helps to attain national objectives like universal access to the services (Wild & Wild, 2018). For instance, the regulation would have helped reduce disagreements and mistrust among the French, German and Sprint partnership. The joint venture failed because billing and distribution of equipment varied with individual countries’ monopoly.

Managing joint ventures of telecom companies tend to be difficult due to difficulties in double parenting. The owners do not operate transnationally because of disputes including the rate at which the company should grow, procedures and costs of operation. There is difficulty in integrating a unified communication network, as in the case of the merged venture of France Telecom, Sprint and Deutsche Telekom. These disputes make the joint venture fail to attain the purpose of providing telecom services to global companies. Operating on a national level rather than transnational would also minimise the language barrier which caused friction among the personnel.

Corporations that make use of telecommunication services have higher chances of being more scalable because digital revolution improves customer-service transactions. Scalability is the ability of a corporate to grow and meet increased demand by addressing consumers’ needs. However, challenges in capital and labour may limit scalability when the company has inadequate funds or assets required for a startup as well as continuity of business operations. For instance, Global One joint venture capital collapsed because the joint venture was unable to raise large sums on international capital markets that were needed to foresee start and operations. The employees also failed to work as a team due to the language barrier, posing a challenge regarding labour. The joint venture failed by realising huge losses even though it was operating globally.

Conclusion

The demand and rapid growth of telephone services have led to globalisation in the telecommunication industry where different telecom companies operate on an international scale. More businesses have become global with the aid of telecom services which helps the company communicate via voice or data to consumers on a global level.