Case Name :      Strategic Crossroads at Matav: Hungary’s Telecommunications Powerhouse

Authors :           Michael Rouse, Jordan Mitchell

Source :             Ivey Publishing

Case ID :            905M33

Discipline :        Strategy

Case Length :    30 pages

Solution Sample availability : YES

Plagiarism : NO (100% Original work)

In September 2004, four months after Hungary joined the European Union, the strategy group of Matav, Hungary’s largest communications company, is working on its mid-term strategic plan. Since being privatized from the state in 1993, the company has seen several changes in its strategy, structure, and culture. Nearly 15 years later, the company is a fully integrated telecommunications company involved in a broad range of services, including fixed line telephony, mobile communications, Internet services, data transmission, and outsourcing. The company’s latest acquisition of a state-run telecommunications company is considered a success, and management believes that international expansion is necessary to realize dynamic growth as its domestic fixed line business is declining. In addition, Hungary’s mobile market is highly competitive and saturated with 80% of the country having mobile phones. The management team feels that Matav is at a crossroads with three main options: expansion in Hungary, regional expansion, or organic growth in existing product lines. The team has to consider all of the lines of business in forming a strategy and whether Matav’s resources and organization are suitable for a healthy future.