Read the following short case study and then answer the questions which follow.

Sohan is the CEO of Cellular X, a cellular communications company providing a cellular phone service to 15 million customers in South Africa, Mozambique and Botswana. Sohan has called in his management team to discuss Cellacom's recent 20% price reduction as he is concerned that this will result in Cellular X's customers moving to Cellacom (Cellacom also operates in the same countries as Cellular X). During the meeting Michael, the Marketing Director of Cellular X, comments that he has heard that Cellacom has been able to offer such reduced rates due to the discounted rates that they receive from Innovation Corp. Sohan comments, "We spend millions on Innovation Corp.'s services every month! I think we will have to renegotiate our contract with them so that we can get a better deal!".

Answer ALL the questions in this section.

Question 2 (20 Marks)

In relation to the case study above, discuss what the current major forces in the macro-environment would be?