Detailed SWOT Analysis of NTT – The Telegraph & Telephone Corporation

Quick Stats on NTT

Founder	Government of Japan
Year Founded	1952
Origin	Japan
No. of Employees	303,350
Company Type	Public
Market Cap	$26.78 Billion (2022)
Annual Revenue	¥11.94 Trillion (2021)
Net Income/ Profit	¥1.12 Trillion (2021)

 

Products & Services by NTT

NTT has been active in the telecommunications industry for a long time and offers the following products and services:

• Mobile phone
• Internet television
• Broadband
• Fixed live telephone
• Digital television
• IT and network service

Competitors of NTT

NTT is one of the largest communications companies in Japan and below are the top 5 competitors of NTT:

• China mobile international
• Vodafone
• Verizon
• AT&T
• NEC

Now, we have a clear picture of the company’s core business. Let’s talk about the SWOT Analysis of NTT.

SWOT Analysis of NTT 

A SWOT analysis examines the strengths, weaknesses, opportunities, and threats that a firm faces. SWOT Analysis is a tried-and-true tool that enables a company like NTT to compare its business and performance to that of its competitors.

It will give us a strategic analysis of its internal and external environment, which is crucial for understanding the SWOT Analysis of NTT.

To better understand the SWOT analysis of NTT, refer to the infographics below:

Below is an explicit guide to the SWOT analysis of NTT.

Strengths of NTT

NTT, being one of the leading companies in its industry, has several benefits that help it flourish in the marketplace. These strengths not only help it retain market share in existing areas but also help it break into new ones.

• Collaboration & Partnership: As the NTT is a multinational company it has so many subsidiary companies and partnerships like NTT East, NTT West, NTT Docomo, NTT urban development, NTT, research NTT data, etc.
• Strong Customer Relationship: From the year 1952, NTT has developed good relations with its customers and due to that, they have reached the majority of its potential market by providing amazing facilities.
• Provide Various Products: The main PSU of this company is to provide telecommunication products like mobile networking, telephone, connectivity in marine, business, internet at access, TV operators, etc. Apart from these, many more products are provided by NTT.
• Leading Market Position: NTT holds a leading market position because of its inception as the sole provider of telephone service in Japan. Since its inception the growth enabled the company to create a new revenue stream and diversify the economic cycle risk in the markets it serves, propelling NTT to the top of the Japanese market.
• Highly Qualified Workforce: Through training and learning initiatives, NTT has been able to develop a highly qualified staff. NTT devotes significant resources to employee training and development, resulting in a team that is not just highly competent but also driven to attain greater success.

Weaknesses of NTT

NTT’s weakness is an area where he can improve. Strategy is about making important decisions, and weaknesses are areas where a company could improve with the help of a SWOT analysis.

• Competition with Brands Affecting the Market: Although NTT has a unique marketing strategy the new brands and other existing brands are also coming up with new strategies. But to maintain the position of best telecom services they need constant advertising, improvement in their products and this causes the majority of the expenses of the brand.
• Reliance on Japan Market for Major Revenue: As NTT has its main headquarters in Japan and it is providing the services more efficiently and gets major revenue from Japan. It is mostly dependent on the Japanese market and hence lacks revenue from worldwide.
• Limited International Presence: NTT currently operates in only eight markets around the world. It should consider operating in other countries, to expand its business and create strong brand recognition and awareness in the market.
• Network Issue in Rural Areas: Not only NTT many more companies are also facing the problem as there are fewer numbers of tsunamis, towers in rural regions, and due to that more traffic happen on the network so that problem has to be fixed.

Opportunities for NTT

Opportunities are possible areas for a company to consider to improve results, sales, and, ultimately, profit. NTT includes the following opportunities:

• Internet Users: According to Statista.com, there are over 4.66 billion active internet users in the world. NTT has a huge opportunity to increase its customer base by providing affordable data plans. 
• New Environmental Policies: The new opportunities will open doors to a level playing field for all the players in the industry. It provides a good opportunity for NTT to drive the advantage home buying new technology and gain market share for new product categories. Also to sustain the potential customers as well as loyal ones.
• Stable Free Cash Flow: The stable cash flow provides opportunities to invest in adjacent products. Hence when more cash is with the company can think of some new technologies and product segments to increase the market share. 
• Technological Advancements: The new technology provides an opportunity for NTT to practice a differentiated pricing strategy in the new market. It enables the firm to maintain its loyal customers with great service and lure new customers through other value oriented propositions.
• Improvement in the Customers: These days we see a very dynamic lifestyle of the people and hence lifestyle and standards mean more consumption of the products and services, and in turn more opportunities to encourage the purchase. This will eventually increase the market share of NTT.

Threats to NTT

External environmental factors that can harm an NTT’s growth are known as threats. NTT’s threats include the following:

• Strong Rivalry from other Communication Providers: There is a lot of competition in the industry these days. This affects prices, resulting in a drop in revenue or income for NTT.
• Threat from Local Distributors: Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
• Reduced Regulation for Legacy Services: For legacy services comparable to NTT, there has been a drop in regulatory levels. The expenses of alternative service providers in the telecom sector have been dramatically decreased as a result of this. With decreased entry barriers, the industry has seen an increase in new participants. This will not only continue to drive down revenues, but it will also drive down market share.

This ends our detailed SWOT analysis of NTT. Let us conclude our learning below.