Access to capital. For new entrants, the cost of the license, infrastructure and customer acquisition must be funded well in advance of positive earnings. External funds and supplier credits may be required for up to four years from the start of operations. Threat of Substitutes products is low. Paging is not a substitute.
Satellites are a substitute, but are prohibitively costly.
The massive capital expenditures required to put these networks into place require that the pricing of the service be significantly higher than that of cellular to earn a respectable return. Landline phone networks fail in mobility . Furthermore, in many cases, the lack of landline infrastructure makes cellular telephony a cheaper alternative. Thus, cellular is actually a cheaper substitute and even a threat to landline. Bargaining power of customers is low.