For as long as five years Audioteka service has been changing reading habits of its

users transferring them to a colourful world of audiobooks. During that time

Audioteka became an independent market leader for audiobooks downloaded
through Internet in Poland (http://audioteka.pl/) and Czech Republic
(http://audioteka.cz/). Further expansion resulted in opening of local versions of the
service in Spain (http://audioteka.es/) and France (http://audioteka.fr/). On each
market Audioteka stands out due to its exceptional functionality and easy access
through mobile applications to all modern platforms, including iOS, Androida,
Windows Phone, Blackberry, Samsung Bada and other. The main supplier of the
mobile applications and IT solutions is K2 Internet S.A., a leading shareholder of
Audioteka (40%). Additionally, the service expansion is supported by the investor Giza Polish Ventures fund (20%) which joined the shareholders in 2012.
Source: http://www.k2.pl/#!/en/press-page/news/audioteka-first-the-czech-marketnow-france-and-spain/
Above fact shows that Audioteka has been successful in expanding its business in
various countries of the world. Continuing this trend, we think that it will also be
successful in India too. Ability of audio books to reach out to the population who
cannot read and who want the enjoyment of multitasking has been the key factors
for the growth of this business in India. For text books audio version is not
recommended and will not succeed too. But Audioteka has been focusing mainly in
the non-text book market which will be loved by the country with 65% of its
population between the age of 15 to 65. Following list and nos. shows it clearly.

Source: http://www.audioteka.co.uk/categories.html
Since online shopping is growing very much in India, there is no doubt that there is
huge market for audio books in India because everything in India is changing
towards technology innovation.

We will present the rationale of this in SWOT analysis form.

Internal analysis:
Strength
Whole concept of the business (audio book) that has potentiality to attract its target audience for e.g. easy way of learning for users,
compatibility with multiple electronic devices, no concentration on book required, ability to multitask and portability to carry
anywhere.
Audioteka is the biggest producer of book recording in Poland and the biggest distribution platform of audio books in Poland and
Czech Republic so it knows the inside-out of this business
Since it is technology based company, it wont require much of capital to establish its new company in India.
Opportunity
Indias growing economy along with favorable government policies for foreign investors there lies huge opportunity for Audioteka to
tap
There is huge latent demand of audio books in India
Urban English-speaking middle class is growing fast in India which is the target segment of such business
India progressing mesmerizingly in IT sector will easily adopt this product.
Growing publishing industries in India will easily provide inbound logistics for the company

Discussion hereafter will be focused on what might be factors or reasons for failure of Audioteka in India.
Audioteka is not that mature enough. Again lack of enough resources (capital, human and technical) and business information
(market, social-cultural, political and economical) might back-fire the company.

Most prominent factor will be its high cost. India is still a developing country and most of its population lies under the poverty line.
There is still huge gap between rich and poor. The cost of audio books is higher than normal books or e-books. Another factor is
tax adding extra cost. While normal books are tax-free, audio books are taxable. Tax along with cost of voiceover artists, narration
and music will make the cost of audio books very higher than that of normal books.
Also following threats might add factors for failure of Audioteka in India.
Constant innovation required before new technologies arrive, otherwise business may be obsolete
Threat of new entrants very high because of high profitability and attractive market share in such business
Corruption and Terrorism in India
Huge gap between rich and poor and majority lying below the poverty line
Poor patent law
Appreciation in Indian Currency

Weakness
High price

External Analysis:
We have based our external analysis (Opportunities and Threat) regarding only the market of India.
Opportunities

Threat
Threat

huge market potential of India

The country also proved to be strategically best for entering South Asian market
Stable political situation supported by strong economic growth rate and worldwide
reorganization in technological sector made the county very attractive market for
Audioteka.
India has a fast growing urban English-speaking middle class, which made it a
preferred investment destination for information technology and outsourcing

services1. India made strong progressand received global recognition in areas such
as the telecoms, IT, and IT-enabled services sectors.
publishing industry was growing at an impressive pace and it was one of the few
places in the world where there is still growth in both print and digital publishing
and the value of it is estimated to be $2 billion with a growth rate of around 15% for
the year 2012.
latent demand for audio books in India

Threat
Despite being such an attractive market, India was still a developing nation very
different from most of the developed countries of Europe.
Corruption and Terrorism
Even though the country is one of the fastest growing economies in the world, there
exists a huge gap between rich and poor people and India is among one of the
countries having highest numbers of individuals living below the poverty line.
Indias poor performance on social indicators
Poor implementation of patent laws and the appreciating Indian currency (rupee)
were the key risks associated with IT-based companies.

the fact that core idea behind production of technology-based product could easily
be transferred and it didnt require much of capital to establish an office in new
location, added more support for rapid expansion.

Growing economy, supported by favorable government policies for foreign investor,

1.2 billion population

before new technology arrived or new competitor entered the market.

Also the fact that technology was changing very rapidly and products associated
with it had shorter lifespan provided great threat to the company.
1

difference in business environment, culture and social setting of the country

compared to European market, made it very challenging for foreign company to
establish well inIndia.

Weakness
The questions associated with it could be, was the company matured enough to
initiate such a big move? Did they have enough resources (capital, human and
technical) and business information (market, social-culture, political and
economical) about it?

High price

Opportunity
the fact that core idea behind production of technology-based product could easily
be transferred and it didnt require much of capital to establish an office in new
location, added more support for rapid expansion.

Growing economy, supported by favorable government policies for foreign investor,

1.2 billion population
Opportunities

For example, in Scandinavian country, the audio book for children were not popular
because people thought that it was more important for kids to have valuable
personal contact rather than engaging them with audio contents. This perception
was due to difference in culture. Those people who believed that audio book was
helping to spread illiteracy among the people by discouraging them to read made
criticism about the technology. The other criticized by saying these kinds of
products were more for blind and disabled people who had problem in reading and
should not be encouraged among general people, as it would make them avoid
reading habits.

Rapid expansion possessed lots of risk on infrastructure side as the company had
little finance and limited number of core employee working in the company. For an
entrepreneurial company like Audioteka, to be able to transform the company into
mid-sized global business required global experience, good managerial skills and
operational excellence, among its management team without which company could
lose its direction while aggressively moving forward in the path of
internationalization.

Country so big in size with stable political and economic environment and immense
market potential were its key features of attraction and Audioteka was interested in
capitalizing them.

the challenges that the country couldpossess would possibly be much bigger than
what they had anticipated.

Opportunity
huge market potential of India
The country also proved to be strategically best for entering South Asian market
Stable political situation supported by strong economic growth rate and worldwide
reorganization in technological sector made the county very attractive market for
Audioteka.
India has a fast growing urban English-speaking middle class, which made it a
preferred investment destination for information technology and outsourcing
services2. India made strong progressand received global recognition in areas such
as the telecoms, IT, and IT-enabled services sectors.
publishing industry was growing at an impressive pace and it was one of the few
places in the world where there is still growth in both print and digital publishing
and the value of it is estimated to be $2 billion with a growth rate of around 15% for
the year 2012.
latent demand for audio books in India

Threat
2

Despite being such an attractive market, India was still a developing nation very
different from most of the developed countries of Europe.
Corruption and Terrorism
Even though the country is one of the fastest growing economies in the world, there
exists a huge gap between rich and poor people and India is among one of the
countries having highest numbers of individuals living below the poverty line.
Indias poor performance on social indicators
Poor implementation of patent laws and the appreciating Indian currency (rupee)
were the key risks associated with IT-based companies.