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Switching At Nokia: unclear numbers
Hey there the case states the following:
The year 2002 was the first year for which production use of the new MMSC was expected,
including possible competitors’ solutions. Exhibit 2 provides a growth projection of the number of MMS messages to be sent starting that year. Nokia’s prediction was that they would be
able to acquire 20% of that market in the first year and grow their share by 5% p.a. thereafter.
Does this mean in the second Year the Market share will be 25% or will it be 1.05*0.2 =21% ?
I’d really appreciate an answer since it think it is really unclear what the base of the calculation is. And It sort of makes a difference for the decision making process like day and night since the having 25.52% market share after 6 years and having 45% market share is a difference of multiple billion €
best regards,
Chris
I don’t see my prior reply hence a second try.
We are talking about an additional 5% of the market, not of the existing share of market.
Think big! Or forever be cynical.
Thanks a lot!