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Future of Telecom Industry in india- - Describe four possible scenarios in the next five years and justify the most possible. On the basisi of our report Bharti Airtel found to be the star 2015------
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Telecom 2015 five telling years
Agenda
• Recap of stage one and stage two• Scenario framework for Telco, 2015
– Standstill– Progressive– Surprise free– Disruptive
• Companies Standing• STAR 2015• Summary and conclusions
Agenda
• Recap of stage one and stage two• Scenario framework for Telco, 2015
– Standstill– Progressive– Surprise free– Disruptive
• Companies Standing• STAR 2015• Summary and conclusions
Agenda
• Recap of stage one and stage two• Scenario framework for Telco, 2015
– Standstill– Progressive– Surprise free– Disruptive
• Companies Standing• STAR 2015• Summary and conclusions
The telecom industry has undergone significant structural changeover the last decade; how will it evolve over the next 5 years?
• With growth of wireless telephony, land line volume is declining.• With increasing competition ARPU is declining . • VOIP and other INTERNET based telephony, bypass Telecom systems.• New technologies in Telecom, demand higher CAPEX with no scope of
matching ROI.• Price wars to somehow gain business volume; hamper income and the
business viability.• Stake holders are compelled to follow the market in pricing, in order to
retain market share.
-How will communications evolve over the next five years?
Four future scenarios
Agenda
• Recap of stage one and stage two• Scenario framework for Telco, 2015
– Standstill– Progressive– Surprise free– Disruptive
• Companies Standing• STAR 2015• Summary and conclusions
Standstill
USAGE: connectivity usage similar to today – personal, download etc.
Services: Packaged connectivity and communication services prevail.
Revenue model: Start war of tariff packages, emphasis on cost control.
Industry Structure: declining of small players
Access: will be depend on advanced technology, which will affect 2G,3G services.
Regulation: will be strict.
Agenda
• Recap of stage one and stage two• Scenario framework for Telco, 2015
– Standstill– Progressive– Surprise free– Disruptive
• Companies Standing• STAR 2015• Summary and conclusions
Progressive
USAGE:- Usage Will be high in this case
SERVICE:- Customer require premium connectivity
ACCESS:- Android and low cost phones drive this scenario
REVENUE MODEL :- Wholesale driven with premium connectivity a key feature for revenue generation Carriers are able to generate premium prices for ultra broadband.
INDUSTRY STRUCTURE:- A co-operative of horizontally integrated infrastructure providers catering to a myriad of asset-light service providers such as OTTs, Banks, Utilities, Governments etc.
REGULATION:- As it is today
TRIGGER / REALIZATION PATH FOR SCENARIO
Economic and Financial
Investment and Technology
Competition Regulation
Consumer and Markets
Investors confident of higher return
from open connectivity innovation
Widespread deployment of
ultrafast broadband
National govt. fund open
infrastructure for economic growth
Increase use/ availability of
connected devices
Current Positioning and Way forward
Scope of Wallet Business
• Scope of business for the MTM Service Provider.– Most money transactions are virtual money moves between
mTm-acc & mTm-acc within the MTM system. Therefore, most of real money remain within the system.
• Potential of MTM as a business.– There will be above billion phones in India soon.– With a minimum monthly average of Rs.10000/- transaction the
annual business will be a mind boggling sum of Rs. 120 Trillion.– The surplus liquidity available could be usefully deployed.
Critical Success AttributesProgressive
Funding model for open access networkinfrastructure
Accessibility in rural market
Dynamic BusinessDesign
Structurally separate Network and services
Potential Capability
Bharti Airtel
Vodafone Idea
Good Good Medium
Good
Excellent
Medium
MediumGoodGood
Good Good
Weak
Recommendations
Partnership with other infrastructure providers includingmunicipalities extend ultra-fast broadband coverage Collaboration with good Rural
retailer
Build modular business architectures based onstandards and flexible, common technology platforms
Create new operating model and organization tosupport structural separation
Innovative applicationSuch as M-Commerce
Excellent Good Good
Companies have to start some new Value added
services
Agenda
• Recap of stage one and stage two• Scenario framework for Telco, 2015
– Standstill– Progressive– Surprise free– Disruptive
• Companies Standing• STAR 2015• Summary and conclusions
Surprise Free
USAGE:- High Usage
SERVICE:- Increased customer adoption digital lifestyle services
ACCESS:- High access required specially in rural. areas
REVENUE MODEL:- Low because of immense competition
INDUSTRY STRUCTURE : Some emerging market providers expand globally.
REGULATION : Liberal policies.
Critical Success Attributes
SURPRISE FREE
INFRASTRUCTURE
3G
RURAL MARKET
VALUE ADDED SERVICES
NUMBER PORTABILITY
Potential capability
Airtel Vodaphone Idea
Good Good Medium
Medium(13)
Good
Medium(11)
GoodGoodExcellent
SecondFirstThird
Weak Medium
Good(9)
RECOMMENDATIONS
Shared infrastructure with reduced Capex and
increased connectivity.
INFRASTRUSTURE
Collaboration with good Rural retailers.
Generate more alternatives for consumers .
Improve Quality Service.
Agenda
• Recap of stage one and stage two• Scenario framework for Telco, 2015
– Standstill– Progressive– Surprise free– Disruptive
• Companies Standing• STAR 2015• Summary and conclusions
Disruptive
USAGE: Demand will be high
Services: Lasses faire
Revenue model: Typically lowering price (Skype)a
Industry Structure: More rivals are entering leading to competition
Access: High value services to customers
Regulation: Deregulation
Percentage of Active Subscribers(sources- TRAI)
Reasons - Multiple sim users or subscribers
signed up only for the freebies that came bundled with startup kits.
Most of the new operators are in the business of throwing Sims to collect a customer.
Unsatisfactory service by new providers.
Operator % of Active users operator wise
BHARTI 89%
IDEA 87%
VODAFONE 75%
RCOM 67%
AIRCEL 59%
BSNL 59%
MTS 46%
TATA TELE 45%
VIDEOCON 39%
UNINOR 31%
STEL 24%
Strategy In rural
• Studies the commercial viability of a rural based on parameters such as source of livelihood, average income, and involvement in frequent commercial transactions or travels.
• Qualifying villages are first to receive a base station• Bharti Airtel tracks the revenue generated per base station (instead
of ARPU, which is considered less relevant in a rural context).• Use of local languages, Vans.• Set up PCO’s to increase brand awareness and service.• Customer service centre are set up with the use of local employees • Bharti Airtel has already established over 18,000 service centers in
rural India, covering over 400 languages and local dialects
Future Strategy
• Changes in the organization structure
• QUALCOMM (US based company- has broadband license in four circle-Mumbai, Delhi, kerala & Haryana)
• Also keep an eye on- UNINOR, VIDEOCON, STEL.
• Additional 40,000 towers for rural market
Strength And weakness
• Strength– Very focused on Telecom– Leadership in fast growing telecom sector– Pan-India footprint
• Weakness
- Price competition from vodafone and idea
- Untapped rural market.
Rohit Kumar GuptaSunny TomarSaud HasanDeepak Kumar VermaRaghav MehtaVinod Kumar