Shangzai
Case Analysis
Shanzhai! MediaTek and “White Box” Handset Market
Issue Identification
MediaTek Company is a large global chipset supplier in wireless handset market. More than half of the chipsets are selling to shanzhai market like China or South Asia. Shanzhai means illegal counterfeits or “knock-offs”. Over the last 30 years, the company had great success through this target market. However, the CEO of the company Ming-Kai Tsai was in a dilemma. He wants to get more opportunities for the company’s further growth. The primary problem is whether they should serve tire-one companies like Nokia, Motorola or Samsung instead of focus on shanzhai market. The secondary problem they faced is the company’s image and the ethical concern. The shanzhaiji defined as the mobile phone designing ideas are copied from other tire-one company with a really low cost. Tsai wondered if he should suggest the shanzhai market to innovate, so he could serve this large market continually.
Internal Analysis (VRINE)
Using the VRINE model we can analyze the internal capabilities of MediaTek and the compare its resources to other competitors. This tool helps us to identify the potential advantages MediaTek has to other companies in the industry.
Is It Valuable?
The business strategy that MediaTek is using is valuable because it targets the market that does not yet use the 3G chipsets and there are not other companies that provide them with chipsets. MediaTek offers the 2.5G and 2.75G chipsets and supplies 50% of the market share. This shows that MediaTek is meeting the required demand and has a stable position in the market.
Is it Rare?
Even though the products and capabilities of MediaTek are not rare but the competitors are mainly concerned about the 3G products rather than the 2.5 and 2.75G chipsets. MediaTek provides training on how to use the chipsets by sending engineers to the customers rather than bringing customers in.
Is it inimitable?
MediaTek offers software and
Shanzhai! MediaTek and “White Box” Handset Market
Issue Identification
MediaTek Company is a large global chipset supplier in wireless handset market. More than half of the chipsets are selling to shanzhai market like China or South Asia. Shanzhai means illegal counterfeits or “knock-offs”. Over the last 30 years, the company had great success through this target market. However, the CEO of the company Ming-Kai Tsai was in a dilemma. He wants to get more opportunities for the company’s further growth. The primary problem is whether they should serve tire-one companies like Nokia, Motorola or Samsung instead of focus on shanzhai market. The secondary problem they faced is the company’s image and the ethical concern. The shanzhaiji defined as the mobile phone designing ideas are copied from other tire-one company with a really low cost. Tsai wondered if he should suggest the shanzhai market to innovate, so he could serve this large market continually.
Internal Analysis (VRINE)
Using the VRINE model we can analyze the internal capabilities of MediaTek and the compare its resources to other competitors. This tool helps us to identify the potential advantages MediaTek has to other companies in the industry.
Is It Valuable?
The business strategy that MediaTek is using is valuable because it targets the market that does not yet use the 3G chipsets and there are not other companies that provide them with chipsets. MediaTek offers the 2.5G and 2.75G chipsets and supplies 50% of the market share. This shows that MediaTek is meeting the required demand and has a stable position in the market.
Is it Rare?
Even though the products and capabilities of MediaTek are not rare but the competitors are mainly concerned about the 3G products rather than the 2.5 and 2.75G chipsets. MediaTek provides training on how to use the chipsets by sending engineers to the customers rather than bringing customers in.
Is it inimitable?
MediaTek offers software and