Advances in internet technology are seeing a new light these days in Pakistan, as evident by the growth of new companies offering various routes of internet provision. Qubee is one company offering broadband technology in Pakistan, err, Karachi to be more precise.
While the number of broadband users in Pakistan has exceeded 0.8 million, as of April 2010, sustainability and growth remains a big concern when one talks about the emergence of a company like Qubee.
The presence of established competitors PTCL, Wateen, Wi-Tribe and Infinity is not going to make life any easier for Qubee.
The established organizations have early movers advantage, giving them an edge as far as understanding the dynamics of market potential and penetration, as well as cost feasibility is concerned. Given the sizeable market share of these companies, economies of scale are another advantage that Qubee will have to compete with.
The broadband market is expected to grow by 30-35 percent over the years as per industry sources, with speculation of 2 million users by 2013. How far Qubee will be able to penetrate and sustain given the tough competition remains to be seen
A comparison of tariffs of major players in broadband reveals that the price packages offered by Qubee are roughly the same. In fact, PTCL offers special discount packages to students, a very lucrative market, which Qubee doesn attract by way of special packages yet.
Sources in the industry (who choose to be left anonymous) have said that since broadband is a capital-intensive business; reducing tariffs may not be very feasible for a nascent company like Qubee.
A dip in prices would mean a delayed payback period and ROI for the company. Therefore, price competition may not be the easiest strategy for Qubee to adopt if a price-war emerges in the future.
The service provider does promise its customers rates without any hidden charges in the form of exorbitant subscription fees, but one wonders how far that can go in helping establish a point of differentiation, in absence of a visible Unique Selling Proposition (USP).
Another important aspect to consider when assessing internet penetration is coverage. In order to spread its reach further, Qubee needs to invest into the yet untapped areas, besides the main urban centres.
However, the reach of the service provider at present is no different from where the competitors are already present, hence putting a doubt on reach being the core competency of the company.
This leaves the area of customer services and after sales support for Qubee to establish as its USP. While the company claims that
eliable broadband is what it offers, with a promise of keeping the customers very satisfied, there is a long way to go before one can comment on its merit.
By the look of things, Qubee is all set to face tough times ahead before it finds its feet in the extremely competitive market of broadband providers. Unless the customer services promised by Qubee are very upbeat and responsive, it may not be the smoothest of sailings for the company given the price sensitive customers that dictate the market.
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