Estonia

1. Estonia KseniaMolchanova Yang Ke (Eric) Bennett Gackle

2. Demographics • 1,307,605 people • Growth rate of -0.632 percent • The average age in Estonia is 39.6 years • Romania = 36.1 years • Germany = 43.4 years • Finland = 41.8 years • United States = 36.7 years • 69 percent of the population is living in urban areas.

3. Government • Very stable. • Parliamentary republic • Gained its independence on August 21, 1991 • Joined the European Union in 2004. • Rated 17th in the world for ease of doing business. • No social unrest in the political structure.

4. Government (cont’d) • Economic trade barriers are low. • Huge openness to foreign direct investments. • Many investment banks from foreign nations elect to set up firms within the countries borders. • Analysts believe the Euro will not be adopted until 2011. • 1 United States Dollar = 11.4795 Estonian Krooni • 1 Euro = 15.6466 Estonian Krooni.

5. Economics

6. Economics (cont’d) • GDP = $29.35 billion (in US Dollars) at purchasing power parity • Growth rate = 7.1 percent per year • GDP per capita in US Dollars is $21,100 per a 2007 estimate • Inflation rate = 6.6 percent • Unemployment rate = 4.7 percent

7. Economics (cont’d) • Tourism is currently on the rise • Growth in alternative sources for energy • Growing disparity between Talinn and the rest of the country • Incomes of Talinn are significantly higher than the rest of the nation

8. Economics (cont’d) • Inflation rate must be reduced to 3 percent before the Euro can be introduced • Apart of the World Trade Organization • Tariffs were put in place to protect agricultural businesses

9. Economics (cont’d)

10. Physical Infrastructure • Shipping goods by sea from the United States to Estonia is relatively easy and available. • Gateway country to Russia and the city of St. Petersburg. • The M-box can get a lot of exposure to both the Tallinn and Helsinki markets ports of both countries.

11. Physical Infrastructure (cont’d) • 968 kilometers of railway stretch across Estonia. • 56,856 kilometers of roadways in Estonia • 13,000 kilometers are paved • 99 kilometers paved as expressways • 19 airports are scattered throughout the country (CIA Factbook). • 12 of these airports have paved runways • 7 have unpaved runways (CIA Factbook).

12. Communications Infrastructure • Programmers designed the program Skype • 382 phone lines per 1000 people. • 1,236 cell phones per 1000 people. • 483 computers per 1,000 people.

13. Communication Infrastructure (cont’d) • 760,000 internet users • Many bars, cafés, restaurants, and lounges offer Wi-Fi access • 3 broadcast stations • 93 percent of households own a television

14. Market Assessment • The video game industry over the next five years will be explosive growth. • In 2005, the global video game market revenue of 29 billion U.S. dollars, • By 2011, global video game market will reach revenues of 44,billion U.S. dollars.

15. Market Assessment (cont’d) • Sony PS3 and strong growth as well as the Nintendo Wii game consoles • But our M-BOX shall become the most important competitor in the future global video game market • Our M-BOX can be aimed at Europe and the South African markets

16. Market Assessment (cont’d) • X-box game consoles market share = 17%. • Sony Playstation market share = 68% by the end of 2004 • Nintendo's market share = 15%. • U.S. video game market sales of 179 billion U.S. dollars in 2006 increased by 43%.

17. Market Assessment (cont’d) • Sony's PS3 game console sales of 16.71 million units. • Nintendo's Wii console sold 36.00 million units. • Xbox 360 game consoles sold 22.55 million units.

18. Global Markets Finland • Borders with Norway, Sweden , and Russia. • Finland's population is 5,300,000. • Most of the population is living in the southern part of a more moderate climate • GDP in 2002 is 139,700,000,000 Euros, per capita GDP is 26,800 Euros.

19. Global Markets (cont’d) • Finland, "the world's most competitive countries." • Finland developed economy, per capita income, which is easily accessible, well-developed of network, the most important thing is our target market Estonia across the sea, to facilitate exchanges.

20. Global Markets (cont’d) • Today, Finland is not only an economically developed country, but also a high-tech and well-developed information society and the world-famous. • Finland adjusted their economic and technological development strategies, making them a world leader. • Finland's information industry is in development

21. Global Markets (cont’d) Russia • World economic power. • GDP reached 1.1356 trillion U.S. dollars, ranking tenth in the world. • Rich in natural resources for agricultural and industrial development. • Computer industry, aerospace aviation industry, the rapid rise of high-tech industries, as well as a strong defense industry. • Therefore, Russia will be another important M-BOX market.

22. Market Entry Strategies • FDI • Pricing Strategy • Developing a home or “domestic” market within the country. • Strong Marketing Strategy. • European Markets—”fair game”. • Gateway to Russia

23. Future Outlook/Potential • Convert from the Estonia kroon to the Euro. • More investments coming from Russia and Spain. • Solid Investments from Sweden and Finland. • Tense oil relations with Russia. • Slumped sales, but will recover in the future.

24. Recommendations Short-term • Translate manuals and console menus into Russian, Estonian, and English. • Price below PS3 and Xbox 360. • Improve advertising. • Develop Distribution channels. • Establish tech support specialists.

25. Recommendations Long-term • Take advantage of future growth. • Offer a wireless console. • Integrate Skype software. • Expand into Russia and Finland. • Improve manufacturing efficiency.