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COUNTRY REPORT SUBMITTED TOWARDS THE PARTIAL FULFILLMENT OF POST GRADUATE DEGREE IN INTERNATIONAL BUSINESS COMPARATIVE ANALYSIS OF THE GROWTH OF TELECOM SECTOR IN INDIA & US SUBMITTED BY : FACULTY GUIDE Name-MANINDER SINGH JUNEJA Faculty-prof debashish choudhary MBA-3CMBA (2010-2012) Amity International Business School Roll No. : A1808710023 AMITY INTERNATIONAL BUSINESS SCHOOL, NOIDA AMITY UNIVERSITY – UTTAR PRADESH

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COUNTRY REPORT SUBMITTED TOWARDS THE PARTIAL FULFILLMENT OF POST GRADUATE DEGREE IN

INTERNATIONAL BUSINESS

COMPARATIVE ANALYSIS OF THE GROWTH OF TELECOM SECTOR

IN INDIA & US

SUBMITTED BY: FACULTY GUIDE Name-MANINDER SINGH JUNEJA Faculty-prof debashish choudhary MBA-3CMBA (2010-2012) Amity International Business School Roll No. : A1808710023

AMITY INTERNATIONAL BUSINESS SCHOOL, NOIDA AMITY UNIVERSITY – UTTAR

PRADESH

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ACKNOWLEDGEMENT Doing a project requires the assistance of many people. These people do their part by guiding us, efficiently developing an outline & providing us the feedback. This project is an honest effort towards putting forward whatever I have gained as a valuable experience that surely, will help me in the path I have chosen. I owe my sincere & heartiest gratitude to Mr Ajit Kumar Pandey and Dr Sanjeev Chaturvedi Faculty, Amity International Business School, for his able guidance, continuous support and cooperation throughout my project without which the present work would not have been possible.They constantly encouraged me and showed the right path from day first till the completion of my project.

I would also like to thank the Head of the Organization, Prof:DEBASHISH CHOUDHARY for providing chance to do this research and also his entire constant support and help in the successful completion of my project. It was an extremely rewarding experience for me in terms of learning I consider it a privilege to express through the pages of this report, a fewwords of gratitude and respect to those who guided and inspired in the completion of this project However, I accept the sole responsibility for any possible errors of omission and would be extremely grateful to the readers of this project report if they bring such mistakes to my notice.

Signature (student)

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CONTENTS:

Chapter-1 INTRODUCTION 4 Chapter-2 HISTORY 6 Chapter-3 OBJECTIVES 11 Chapter-4 TELECOM SECTOR IN INDIA 12 Chapter-5 GROWTH OF TELECOM IN INDIA 53 Chapter-6 TELECOM SECTOR IN USA 70 Chapter-6 SWOT ANALYSIS 90

Chapter-7 CONCLUSIONS OF INDIA 97 Chapter-8 CONCLUSIONS OF USA 98 Chapter-9 REFRENCES 99

INTRODUCTION Telecommunication is the transmission of information over significant distances to communicate. In earlier times, telecommunications involved the use of visual signals, such as beacons, smoke signals, semaphore telegraphs, signal flags,

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and optical heliographs, or audio messages via coded drumbeats, lung-blown horns, or sent by loud whistles, for example. In the modern age of electricity and electronics, telecommunications now also includes the use of electrical devices such as the telegraph, telephone, and teleprinter, as well as the use of radio and microwave communications, as well as fiber optics and their associated electronics, plus the use of the orbiting satellites and the Internet.

A revolution in wireless telecommunications began in the 1900s (decade) with pioneering developments in wireless radio communications by Nikola Tesla and Guglielmo Marconi. Marconi won the Nobel Prize in Physics in 1909 for his efforts. Other highly notable pioneering inventors and developers in the field of electrical and electronic telecommunications include Charles Wheatstone and Samuel Morse (telegraph), Alexander Graham Bell(telephone), Edwin Armstrong, and Lee de Forest (radio), as well as John Logie Baird and Philo Farnsworth (television).

The world's effective capacity to exchange information through two-way telecommunication networks grew from 281 petabytes of information in 1986, to 471 petabytes in 1993, to 2.2 exabytes in 2000, and to 65 exabytes in 2007.This is the informational equivalent of 2 newspaper pages per person per day in 1986, and 6 entire newspapers per person per day by 2007. Given this growth, telecommunications play an increasingly important role in the world economy and the worldwide telecommunication industry's revenue was estimated to be $3.85 trillion in 2008. The service revenue of the global telecommunications industry was estimated to be $1.7 trillion in 2008, and is expected to touch $2.7 trillion by 2013.

Telecom industry comprises the firms in business transmission of voice and data between devices.Voice and data are encoded and decoded into electrical signals after transmission and before reaching the destination. The signals are then transmitted over a network of copper/fiber-optic cable.The significance of this industry can be judged from the enormous amount of the revenues it generates. In 2005 the total revenues across the world in this industry to amounted 1.2 trillion which is almost 3% of the world GDP. In the US,Voice

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business amounts to 64.9% of the business while Data and other services take the rest of the market However due to recent advances in technology the share of data has been increasing rapidly High speed internet is rapidly making a way into households and is poised to become the leading revenue earner for the firms in the industry. Most of the firms in the business have one or more four distinct lines of business,

1) Voice services

2) Wireless voice/data services and

3) Internet/ Broadband/Data services and more recently

4) Video services.

Until the early 90’s the industry was compromised of monopoly regional operators strictly regulated by the Federal Communication Commission (FCC) and the state public utility commissions. The firms who wanted to enter the business in this industry needed the licenses from FCC. The monopolistic nature of these corporations meant price controls were imposed any price rises were decided by the regulatory bodies upon requests by businesses citing increased expenses.

Chapter 2

HISTORY Ancient systems Greek hydraulic semaphore systems were used as early as the 4th century BC. The hydraulic semaphores, which worked with water filled vessels and visual signals, functioned as optical telegraphs. However, they could only utilize a very limited range of pre-determined messages, and as with all such optical

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telegraphs could only be deployed during good visibility conditions.

During the Middle Ages, chains of beacons were commonly used on hilltops as a means of relaying a signal. Beacon chains suffered the drawback that they could only pass a single bit of information, so the meaning of the message such as "the enemy has been sighted" had to be agreed upon in advance. One notable instance of their use was during the Spanish Armada, when a beacon chain relayed a signal from Plymouth to London that signaled the arrival of the Spanish warships

Systems since the Middle Ages In 1792, Claude Chappe, a French engineer, built the first fixed visual telegraphy system between Lille and Paris. However semaphore systems suffered from the need for skilled operators and the expensive towers at intervals of 10–30 kilometers (6–20 mi). As a result of competition from the electrical telegraph, Europe's last commercial semaphore line in Sweden was abandoned in 1880.

Telegraph and telephone The first commercial electrical telegraph was constructed by Sir Charles Wheatstone and Sir William Fothergill Cooke, and its use began on April 9, 1839. Both Wheatstone and Cooke viewed their device as "an improvement to the electromagnetic telegraph" not as a new device.

The businessman Samuel F.B. Morse and the physicist Joseph Henry of the United States developed their own, simpler version of the electrical telegraph, independently. Morse successfully demonstrated this system on September 2, 1837. Morse's most important technical contribution to this telegraph was the rather simple and highly efficient Morse Code, which was an important advance over Wheatstone's complicated and significantly more expensive telegraph system. The communications efficiency of the Morse Code anticipated that of the Huffman code in digital communications by over 100

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years, but Morse and his associate Alfred Vail developed the code purely empirically, unlike Huffman, who gave a detailed theoretical explanation of how his method worked.

The first permanent transatlantic telegraph cable was successfully completed on 27 July 1866, allowing transatlantic electrical communication for the first time. An earlier transatlantic cable had operated for a few months in 1859, and among other things, it carried messages of greeting back and forth between President James Buchanan of the United States and Queen Victoria of the United Kingdom.

However, that transatlantic cable failed soon, and the project to lay a replacement line was delayed for five years by the American Civil War. Also, these transatlantic cables would have been completely incapable of carrying telephone calls even had the telephone already been invented. The first transatlantic telephone cable (which incorporated hundreds of electronic amplifiers) was not operational until 1956.

The conventional telephone now in use worldwide was first patented by Alexander Graham Bell in March 1876. That first patent by Bell was the master patent of the telephone, from which all other patents for electric telephone devices and features flowed. Credit for the invention of the electric telephone has been frequently disputed, and new controversies over the issue have arisen from time-to-time. As with other great inventions such as radio, television, the light bulb, and the digital computer, there were several inventors who did pioneering experimental work on voice transmission over a wire, and then they improved on each other's ideas. However, the key innovators were Alexander Graham Bell and Gardiner Greene Hubbard, who created the first telephone company, the Bell Telephone Company in the United States, which later evolved into American Telephone & Telegraph (AT&T).

The first commercial telephone services were set up in 1878 and 1879 on both sides of the Atlantic in the cities of New Haven, Connecticut, and London, England.

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Radio and television In 1832, James Lindsay gave a classroom demonstration of wireless telegraphy via conductive water to his students. By 1854, he was able to demonstrate a transmission across the Firth of Tayfrom Dundee, Scotland, to Woodhaven, a distance of about two miles (3 km), again using water as the transmission medium. In December 1901, Guglielmo Marconi established wireless communication between St. John's, Newfoundland and Poldhu, Cornwall (England), earning him the Nobel Prize in Physics for 1909, one which he shared with Karl Braun. However small-scaleradio communication had already been demonstrated in 1893 by Nikola Tesla in a presentation before the National Electric Light Association.

On March 25, 1925, John Logie Baird of Scotland was able to demonstrate the transmission of moving pictures at the Selfridge's department store in London, England. Baird's system relied upon the fast-rotating Nipkow disk, and thus it became known as the mechanical television. It formed the basis of experimental broadcasts done by the British Broadcasting Corporation beginning September 30, 1929. However, for most of the 20th century, television systems were designed around the cathode ray tube, invented by Karl Braun. The first version of such an electronic television to show promise was produced by Philo Farnsworth of the United States, and it was demonstrated to his family in Idaho on September 7, 1927.

Television, however, is not solely a technology, limited to its basic and practical application. It functions both as an appliance, and also as a means for social story telling and message dissemination. It is a cultural tool that provides a communal experience of receiving information and experiencing fantasy. It acts as a “window to the world” by bridging audiences from all over through programming of stories, triumphs, and tragedies that are outside of personal experiences.

Computer networks and the Internet

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On 11 September 1940, George Stibitz was able to transmit problems using teleprinter to his Complex Number Calculator in New York and receive the computed results back at Dartmouth College in New Hampshire. This configuration of a centralized computer or mainframe computer with remote "dumb terminals" remained popular throughout the 1950s and into the 1960s. However, it was not until the 1960s that researchers started to investigate packet switching — a technology that allows chunks of data to be sent between different computers without first passing through a centralized mainframe. A four-node network emerged on December 5, 1969. This network soon became the ARPANET, which by 1981 would consist of 213 nodes.

ARPANET's development centred around the Request for Comment process and on 7 April 1969, RFC 1 was published. This process is important because ARPANET would eventually merge with other networks to form the Internet, and many of the communication protocols that the Internet relies upon today were specified through the Request for Comment process. In September 1981, RFC 791 introduced the Internet Protocol version 4 (IPv4) and RFC 793 introduced the Transmission Control Protocol (TCP) — thus creating the TCP/IP protocol that much of the Internet relies upon today.

However, not all important developments were made through the Request for Comment process. Two popular link protocols for local area networks (LANs) also appeared in the 1970s. A patent for the token ring protocol was filed by Olof Soderblom on October 29, 1974, and a paper on the Ethernet protocol was published by Robert Metcalfe and David Boggs in the July 1976 issue ofCommunications of the ACM. The Ethernet protocol had been inspired by the ALOHAnet protocol which had been developed by electrical engineering researchers at the University of Hawaii

TELECOMMUNICATION INDUSTRY

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The Telecommunications Industry Association (TIA) is the leading trade association representing the global information and communications technology (ICT) industry through Standards development, Policy initiatives, business opportunities, market intelligence and networking events. With support from hundreds of members, TIA enhances the business environment for companies involved in telecom, broadband, mobile wireless, information technology, networks, cable, satellite, unified communications, emergency communications and the greening of technology. TIA is accredited by ANSI.

CHAPTER-3

OBJECTIVES

v To compare and contrast the difference in the USA and INDIA’S TELECOM SECTOR and their contributions to respective economies.

v Major challenges for TELECOM SECTOR in INDIA AND USA

and its weaknesses, and analyze their roots.

v The opportunities for TELECOM Business in future and the major competitors to its business.

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INDIAN TELECOM MARKET

Third largest in the world and the second largest among the emerging economies of Asia, the Indian Telecommunication network has proved its mettle time and again. Public as well as private segments of the economy have made significant contributions to make the sector one of the key contributors to India's success story.

The growth of Indian telecommunication sector is highly driven by supportive government policies, emerging new technologies and changing consumer behaviour. The fact that the industry has made stupendous growth in recent times is reflected in the statistics, key developments, investments and future prospects pertaining to itare discussed hereafter.

Key Statistics

• In its recent statement issued, Telecom Regulatory Authority of India (TRAI) has revealed that the country's mobile subscriber base has increased from 893.84 million in December 2011 to 903.73 million in January 2012, growing by 1.11 per cent

• Telecom operators added 9.88 million mobile subscribers in January 2012, taking the total telephone user base to 936.12 million

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• The overall tele-density (telephones per 100 people) reached 77.57 per cent

• Broadband subscriber base increased from 13.30 million at the end of December 2011 to 13.42 million at the end of January 2012

Market Dynamics

The Indian handset market has registered 14.1 per cent growth in 2011 marking a volume sale of 182 million handsets. The Indian handset market is led by Nokia with 37.2 per cent market share, followed by Samsung (14.9 per cent), G'Five (7.5 per cent) and Micromax (5.8 per cent).

Indian handset market experiences a strong presence of domestic and Chinese handset makers (like Micromax, G'Five, Karbonn, Spice, Maxx and Lava) owing to their offerings that are reasonably priced as well as fully featured with latest technologies and applications.

Moreover, every vendor is venturing into the flourishing smartphone market in India. A report by CyberMedia Research (CMR) reveals that that there were 10 million units of smartphones shipments over January-November 2011. The report titled 'India Monthly Mobile Handsets Market Review' also stated that there were 23 smartphone model launches in the month of November itself.

For smartphone shipments also (during January-November 2011), Nokia led the market with 38.4 per cent share, with Samsumg (27.5 per cent) and Reliance India Mobile (RIM [15.5 per cent]) trailing behind.

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Key Developments & Investments

• In a bid to globalise its Indian operations that would support its global product supply chain, Ericsson, the world's largest mobile network equipment maker, has plans to ramp up its investments in the country. Driven by changing demographics and consumer behaviour, Ericsson's strategy is to upgrade Indian operations from being domestic-market oriented to export oriented

• Indian start-up company Lava has formed a strategic partnership with Intel with the launch of the first Intel-powered smartphone in India, the Xolo X900. Lava, which has so far manufactured budget phones, will now produce smartphones under the brand name 'Xolo'

• India's third largest mobile phone company Idea Cellular has entered an alliance with Opera Software to launch a customised 'Opera Mini' mobile web browser. Apart from being a mass-market web browser that claims to offer a rich web experience to smartphone users, Opera Mini would also help in driving data traffic and increase average revenue per user (ARPU)

• Bharti Airtel has launched an innovative mobile money platform called 'Airtel Money' in India through its wholly-owned subsidiary Airtel M Commerce Services Ltd (AMSL). Airtel users, across 300 key cities in India, would be empowered to top-up their cell-phones with airtime and pay for their utility bills, recharges, shopping at 7,000-plus merchant outlets and online transactions through this fast, simple and secure service

• India's fifth-largest Global System for Mobile Communications (GSM) operator Aircel, has decided to renew its outsourcing contract worth US$ 100 with Nokia Siemens Networks (NSN) to manage its mobile networks in seven circles - Delhi, Mumbai, Kolkata, Punjab, Haryana, West Bengal and Rajasthan

NSN has also bagged a contract from Bharti Airtel, the world's fifth largest telecom company, to build and operate its long-term evolution (LTE) network in Maharashtra circle. LTE is a 4G mobile broadband technology that supports services like high-speed internet and video streaming on the go.

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Government Initiatives

The sector regulator, TRAI, has issued guidelines to all the operators to set up a complaint centre under Telecom Consumers Complaint Regulations, 2012. The centre would be responsible in acknowledging all the complaints it receives, even if the complaint is made by a subscriber of another mobile operator. It would have a toll-free number and would be equipped with a web-based complaint monitoring system, through which the consumers can track their complaints.

TRAI is also doing its bit to achieve the aim of carbon emission reduction under which operators are directed to achieve carbon reduction to the extent of 5 per cent by 2012-13, 12 per cent by 2016-17 and 17 per cent by 2018-19. With regards to these norms under 'Green Telephony', TRAI has further mandated for all the operators that at least 50 per cent of all rural towers and 20 per cent of all urban towers are to be powered by hybrid power by 2015. The government has also given its nod for the same.

Moreover, the National Telecom Policy (NTP) 2012 has received approval from the Telecom Commission. It will now head to the Cabinet for further consideration and approval. The new telecom policy endorses free roaming service to telecom users while allowing them to retain their numbers without paying extra. The new policy would also allow telecom players to exit from the business under specific conditions

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Information Note to the Press (Press Release No. 72/2012)

TELECOM REGULATORY AUTHORITY OF INDIA

New Delhi, 7th April, 2012

For immediate release Website: www.trai.gov.in

Highlights on Telecom Subscription Data as on 29th February 2012

Particulars Wireless Wireline Total

Wireless+Wireline

Total Subscribers (Millions) 911.17 32.33 943.49

Total Net Addition (Millions) 7.44 -0.07 7.37

Monthly Growth (%) 0.82% -0.21% 0.79%

Urban Subscribers (Millions) 594.11 24.71 618.82

Urban Subscribers Net Addition (Millions) 3.01 -0.02 2.99

Monthly Growth (%) 0.51% -0.07% 0.49%

Rural Subscribers (Millions) 317.06 7.62 324.68

Rural Subscribers Net Addition (Millions) 4.43 -0.05 4.38

Monthly Growth (%) 1.42% -0.65% 1.37%

Overall Teledensity* 75.42 2.68 78.10

Urban Teledensity* 162.61 6.76 169.37

Rural Teledensity* 37.62 0.90 38.53

Share of Urban Subscribers 65.20% 76.43% 65.59%

Share of Rural Subscribers 34.80% 23.57% 34.41%

Mobile Number Portability requests increased from 32.79 million subscribers at the end of January 2012 to 37.11 million at the end of February 2012. In the month of February 2012 alone, 4.32 million requests have been made for MNP. Active wireless subscribers on the date of Peak VLR in February 2012 are 670.65 Million. Broadband subscription reached to 13.54 Million in February 2012 from 13.42 Million in January 2012.

_______________________________________________________________________________________________ * Based on the population projections from Census data published by the Office of Registrar General & Census Commissioner of India.

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1

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I. Total Telephone Subscribers

� The number of telephone Total (Wireless+Wireline) Subscribers in Million

subscribers in India increased to

1000 936.12

943.49

943.49 Million at the

end of

900

February, 2012 from 936.12 Million

800

at the end of January 2012, thereby

700

615.83

618.82

registering a growth rate of 0.79%.

600

The share of Urban subscribers has

500

declined to 65.59% from 65.79%

400

320.29

324.68

whereas share of Rural Subscribers

300

has increased to 34.41%

in the

200

month of February 2012. With this,

100

the overall Tele-density in India

0

reaches to 78.10 at the end of January‐12 February‐12

February, 2012 from 77.57 of the Total Subscribers Urban Rural

previous month.

Overall Teledensity � Subscription in Urban Areas grew

from 615.83 million in January, 2012

168.84

180 169.37

to 618.82

million

at the end of

160 February, 2012. Subscription in Rural

140 Areas increased from 320.29 million

120

to 324.68 million during the same

100

77.57

78.10

period. The growth of

Urban and

80

Rural Subscription is

0.49% and

60

38.04 38.53 1.37% respectively. The overall Urban

40

teledensity has increased from 168.84

20

0 to 169.37 and Rural teledensity

January‐12 February‐12 increased from 38.04 to 38.53.

Overall Urban Rural

2

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Overall Teledensity (Circle Wise)

All India

Assam Bihar

Madhya Pradesh

J & K

UP*

North East

Orissa Rajasthan

West Bengal*

Andhra Pradesh Haryana

Gujarat

Karnataka

Maharashtra*

Kerala Punjab

Tamil Nadu

Himachal Pradesh Delhi

0

* Population data/Projections are available state wise only. Notes:

1. Teledensity figures are derived from the subscriber data provided by the operators and the population projections published by the Office of the Registrar General & Census Commissioner, India.

2. Delhi Service area, apart from the State of Delhi, includes wareas served by the local exchanges of Ghaziabad & Noida (in UP) and Gurgaon & Faridabad (in Haryana).

Overall Teledensity (Circle Wise)

Overall Teledensity

78.10

45.46

48.25

53.52

54.17

60.16

64.74

65.45

71.80

79.25

80.64

87.82

90.04

96.81

96.50

107.77

113.25

116.57

119.59

236.33

50 100

150 200

250

* Population data/Projections are available state wise

Teledensity figures are derived from the subscriber data provided by the operators and the population projections published by the Office of the Registrar General & Census

Delhi Service area, apart from the State of Delhi, includes wireless subscribers of the areas served by the local exchanges of Ghaziabad & Noida (in UP) and Gurgaon & Faridabad (in Haryana).

3

236.33

250

Teledensity figures are derived from the subscriber data provided by the operators and the population projections published by the Office of the Registrar General & Census

ireless subscribers of the areas served by the local exchanges of Ghaziabad & Noida (in UP) and Gurgaon &

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II. Wireless Segment (GSM, CDMA & FWP)

� Total Wireless subscriber base Total Wireless Subscribers (in Millions)

increased from 903.73 Million in 1000 903.73

911.17

January 2012 to 911.17 Million at

900

the end of February 2012, 800

registering a growth of 0.82%. The 700 591.10

594.11

share of Urban Subscriber

has 600

500

marginally decreased from 65.41 %

400 312.62

317.06

to 65.20% where as share of Rural

300

Subscribers has marginally 200

increased from 34.59% to 34.80%. 100

The overall wireless Tele density in 0

January‐12 February‐12

India reaches 75.42. Total Subscribers Urban Rural

• Wireless subscription in Urban

Wireless Teledensity Areas increased from 591.10 million

180 162.06

162.61

in January 2012 to 594.11 million at

the end of February 2012.

The

160

140 subscription in Rural Areas

120 increased from 312.62 million to

100 317.06 million during the same

74.89

75.42

80

period. This shows higher growth in

60 Rural Subscription (1.42%) than

37.13 37.62 Urban Subscription (0.51%).

The

40

Urban wireless teledensity

has

20

increased from 162.06 to 162.61 and

0

Rural teledensity has increased from

January‐12 February‐12

Overall Urban Rural 37.13 to 37.62. Detailed statistics is

at Annexure I.

4

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• Private operators hold 88.64% of the wireless market share where as BSNL

and MTNL, two PSU operators hold only 11.36% market share. The graphical

presentations of market shares and shares in net additions

providers during the month of February 2012 are given below:

A. Service Provider wise Market Share as on 29

Videocon

Sistema 0.68%

1.69%

Uninor

4.52%

Aircel

6.94%

Tata 8.99%

BSNL 10.73%

Idea

12.15%

B. Service Providers’ share in net additions during February 2012

31.4

8%

2 4. 5 0 %

.08%

1 3

Uni

nor

h a r t i

Relia

nce

Note: The subscriber figures of S Tel are taken as on January 2012, due to noninformation for February 2012.

• Private operators hold 88.64% of the wireless market share where as BSNL

and MTNL, two PSU operators hold only 11.36% market share. The graphical

presentations of market shares and shares in net additions of all the service

providers during the month of February 2012 are given below:

A. Service Provider wise Market Share as on 29th February 2012.

Videocon MTNL Loop Stel 0.63% 0.38% 0.36% HFCL

0.68%

0.15%

Etisalat

0.09%

Bharti

19.62%

Reliance 16.68% Vodafone

16.40%

Pvt : 88.64% PSU: 11.36%

B. Service Providers’ share in net additions during February 2012

Share in Net Addition

(Net Add.= 7,440,985)

26%

.6 7 %

1 0

.69

%

12 %

54%

17%

47%

15%

00% 22

4 .

3 .

1 .

1 . . . 0 0 0

Voda

fon

e i r c e l

Sist

ema

BSNL

HFCL

MTN

L Lo

op

Stel

Vide

ocon

The subscriber figures of S Tel are taken as on January 2012, due to non-submission ofinformation for February 2012.

5

• Private operators hold 88.64% of the wireless market share where as BSNL

and MTNL, two PSU operators hold only 11.36% market share. The graphical

of all the service

February 2012.

Bharti

19.62%

Reliance

16.68%

B. Service Providers’ share in net additions during February 2012

Net Addition

(Net Add.= 7,440,985)

22 %

6 1 %

. .

2 4 ‐

T a t a

submission of

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III. VLR Data

Out of the total 911.17 Million wireless subscribers, 670.65 Million were

active on the date of Peak VLR for the month of February 2012. The total

active VLR number excludes the CDMA VLR figure of BSNL, as the service

provider has not provided the VLR figures of their total CDMA subscriber base

of 4.10 million. The proportion of VLR subscribers is approximately 73.60% of

the total wireless subscriber base reported by the service providers.

Circle-wise, J&K has the highest proportion of VLR subscribers with

82.81% followed by Assam (82.13%) and MP (80.55%); Mumbai has the

lowest proportion with 63.74%. Service Provider wise, Idea leads the tally with

92.90% followed by Bharti (91.88%); STel is at the bottom with 28.53%. The

detailed statistics of proportionate VLR is at Annexure II & methodology used

for reporting subscriber base/active subscribers is at Annexure IV. Proportion of VLR subscribers (Circle wise)

Proportion of VLR

.8 1 .13

.55

.00

.71

.51

.48

.68

.85

.33

90

8 28 2 .6 3 .9 7 .59 .5 2

90

8 0 .3 1 .1 3

ill io n s)

7 9 .3 7

7 7 7 7 .2 3

7 6 .6 2 .4 1

75

7 4 7 4 7 3 7 2

72 7 2 .3 9

63.7

4

80 7 1 80 7 1 6 9 6 8

6 7 6 7

70 6 4

70

60 60

%

50 50

VLR

Subs

cribe

rs 40 40

30

30

20 20

10 10

0

0

K

Assam

Mad

hya

Mah

arashtra

Rajasthan

Gujarat

And

hra

(E)

Delhi

Karna

taka

Pun

jab

West

(W)

Bihar

Kerala

Haryana

HP

East

Orissa

Kolkata

Nad

u Mum

bai

&

.

J P .

P

Nort

h

.

U .

Tam

il

U

Total Subs VLR Subs VLR %

6

Page 22: Maninder Us Telecom

Proportion of VLR subscribers (Service Provider wise) Proportion of VLR

.9 0 .8 8 87

.68

9 2

200 9 1 100

180

90

.39

160

31 06

80

6 5 7 9 .11

140 70 .

57 5 7

66

5 5 8 6

120

53 7 9 .4 7 5 5 60 %

.

48

4 5

2 9

4 3 4 2

VL

R

100

4 1 50

.

5 3

80 3 6 . 40

28

60

30

40 20

20 10

0

Idea

Tata

Loop

Tel 0

S

Voda

fone R

eli anc

e Siste

ma is al at

Vide

ocon

M T N L

Total Subs VLR Subs VLR %

* The subscriber figures of S Tel are taken as on January 2012, due to non-submission of

information for Feb-2012.

7

Page 23: Maninder Us Telecom

IV. Mobile Number Portability As per the data reported by the service providers, by the end of February

2012 about 37.11 million subscribers have submitted their requests to

different service providers for porting their mobile number. In MNP Zone-I

(Northern & Western India) maximum number of requests have been

received in Gujarat (3.42 million) followed by Rajasthan (3.26 million)

whereas in MNP Zone-II (Southern & Eastern) maximum number of requests

have been received in Karnataka (3.94 million) followed by Andhra Pradesh

Service area (3.46 million). In the month of February 2012, total number of

subscribers who have submitted their request for MNP is 4.32 million. The

status of MNP requests in various service areas is given below:

Service Area Wise MNP Status at the end of February, 2012

Zone -1 Zone - 2

Number of Number of

Service Area Porting Service Area Porting

Requests Requests

Delhi 1641506

Andhra Pradesh 3460753

Gujarat 3426450 Assam 85400

Himachal Pradesh 141593 Bihar 778624

Haryana 1642668 Karnataka 3940238

Jammu & Kashmir 6055 Kerala 1860763

Maharashtra 2909573 Kolkata 777454

Mumbai 1299078 Madhya Pradesh 2264486

Punjab 1436221 North East 27959

Rajasthan 3256438 Orissa 788425

Uttar Pradesh - East 2031205 Tamil Nadu 2232754

Uttar Pradesh - West 2038921 West Bengal 1064683

Total 19829708 Total 17281539

Total (Zone-1 + Zone-2)

37111247

Net Addition

4322509

(in February 2012)

8

Page 24: Maninder Us Telecom

V. Wireline Segment

Wireline subscriber base declined from 32.39 Million at the end of January

2012 to 32.33 Million at the end

Subscribers has increased from 76.32% to 76.43% where as share of Rural

Subscribers has declined from 23.68% to 23.57%.

density in India has remained, more or less, stable at 2.68 with urban and

rural teledensity being 6.76 and 0.90 respectively. BSNL and MTNL, two PSU

operators hold 80.76% of the Wireline market share. Detailed statistics is at

Annexure-III. The graphical presentation of market share of all service

providers as on 29th February 2012 is given below:

A. Service Provider wise Market Share as on 29

Reliance3.93%

Tata 4.40%

Bharti 10.08%

MTNL 10.69%

Pvt : 19.24%

Note: Fixed line subscriber base corresponding to Vodafone is for corporate they have started reporting to TRAI from February 2012.

Wireline subscriber base declined from 32.39 Million at the end of January

32.33 Million at the end of February 2012. The share of Urban

Subscribers has increased from 76.32% to 76.43% where as share of Rural

Subscribers has declined from 23.68% to 23.57%. The overall wireline tele

in India has remained, more or less, stable at 2.68 with urban and

rural teledensity being 6.76 and 0.90 respectively. BSNL and MTNL, two PSU

operators hold 80.76% of the Wireline market share. Detailed statistics is at

III. The graphical presentation of market share of all service

providers as on 29th February 2012 is given below:

A. Service Provider wise Market Share as on 29th Feb. 2012

Reliance HFCL Sistema

0.62% 0.15%

3.93%

Vodafone

0.05%

BSNL

70.07%

PSUs : 80.76%

Fixed line subscriber base corresponding to Vodafone is for corporate customers, whichthey have started reporting to TRAI from February 2012.

9

Wireline subscriber base declined from 32.39 Million at the end of January

The share of Urban

Subscribers has increased from 76.32% to 76.43% where as share of Rural

The overall wireline tele-

in India has remained, more or less, stable at 2.68 with urban and

rural teledensity being 6.76 and 0.90 respectively. BSNL and MTNL, two PSU

operators hold 80.76% of the Wireline market share. Detailed statistics is at

III. The graphical presentation of market share of all service

Feb. 2012

customers, which

Page 25: Maninder Us Telecom

B. Service providers’ share in Net Addition during February 2012.

40% 20% 0%

-20% -40% -60% -80% -100% -120% -140% -160% -180%

Share in Net addition

0.73%

Bharti

BSNL

-152.95%

B. Service providers’ share in Net Addition during February

Share in Net addition

(Net addition= -66562)

23.23% 26.41%1.36% -1.30% 1.50% 1.01%

HFCL MTNL

Reliance

Sistema Vod

afone

152.95%

B. Service providers’ share in Net Addition during February

26.41%

Vod

afo

Page 26: Maninder Us Telecom

10

Page 27: Maninder Us Telecom

VI. Category wise Growth

� From the below tables, Circle A shows the highest net addition and highest rate of monthly growth in the wireless sector from January 2012 to February 2012.

Category wise Net Additions and subscriber base

Net Additions during the Category month of February, 2012

Wireline

-14356.7 Circle A

Circle B -57196

Circle C -5998

Metro 10988.43

All India -66562

Category-wise Growth Rate in Access Service

Monthly Rate of Growth

Category (Feb-2011 to Feb

Wireline

-0.11% Circle A

Circle B -0.55%

Circle C -0.29%

Metro 0.16%

All India -0.21% � Metros indicate data for Delhi, Mumbai & Kolkata. Data for Chennai service area has

been included in Circle A, as part of TN

Category wise Growth

From the below tables, Circle A shows the highest net addition and highest rate of monthly growth in the wireless sector from January 2012 to February 2012.

Category wise Net Additions and subscriber base

Net Additions during the Subscriber Base as on 29month of February, 2012 February, 2012

Wireline

Wireless

Wireline

14356.7

12769715

3789806

57196 3320601 10471157

5998 1251812 2075705

10988.43 -921234 7075461

66562 7440985 32392038

wise Growth Rate in Access Service

Monthly Rate of Growth

Yearly rate of growth

2011 to Feb-2012) (Feb-2011 to Feb

Wireline

Wireless

Wireline

Wireless

0.11%

-4.97%

1.19%

0.55% 0.93% -8.24%

0.29% 1.01% -27.95%

0.16% -0.88% -1.86%

0.21% 0.82% -7.28%

tros indicate data for Delhi, Mumbai & Kolkata. Data for Chennai service area has been included in Circle A, as part of TN

11

From the below tables, Circle A shows the highest net addition and highest rate of monthly growth in the wireless sector from January

Subscriber Base as on 29th

February, 2012

Wireless

322010067

360624143

125336344

103197639

911168193

Yearly rate of growth

2011 to Feb-2012)

Wireless

14.03%

16.56%

19.63%

8.83%

15.14%

tros indicate data for Delhi, Mumbai & Kolkata. Data for Chennai service area has

Page 28: Maninder Us Telecom

VII. Broadband (≥ 256 Kbps download)

Total Broadband subscriber base has increased from 13.42 million at the

end of January 2012 to 13.54 million at the end of February 2012, there by

showing a monthly growth of 0.87%. Yearly growth in broadband subscribers is

18.02% during the last one year (Feb. 2011 to Feb. 2012).

As on 29th Feb. 2012, there are 155 Internet Service Providers (ISPs) which

are providing broadband services in the country. Top three ISPs in terms of

market share are: BSNL with 8.78 million subscribers, Bharti Airtel with 1.36

million and MTNL with 1.03 million subscribers.

Broadband Market Share

Others, 17.5%

BSNL, 64.8%

MTNL, 7.6%

Bharti, 10.0%

BSNL Bharti MTNL Others

***

Contact details in case of any clarification:

Raj Pal, Advisor (ER), TRAI

Mahanagar Doorsanchar Bhawan

Jawahar Lal Nehru Marg, Authorised to issue:

New Delhi – 110002

Ph: 011-23230752 (Raj Pal)

Fax: 011-23236650

E-mail: [email protected] Advisor (ER)

Note: Information in the Press Release is based on the data provided by the Service Providers.

12

Page 29: Maninder Us Telecom

Wireles

s Subscriber Bas

e Annex

ure-I

Pag

e 1 of 3

Group

Bharti

Reliance

Vodafone

Tata

Idea

Airce

l/Dishnet

Circle

Jan-12

Feb

-12

Ja

n-12

Feb

-12

Ja

n-12

Feb

-12

Jan-12

Feb

-12

Jan-12

Fe

b-12

Jan-12

Feb

-12

Andhra Pradesh

1790

0408

1800

5577

9349

500

9443

471

6784

329

6624

192

7707

188

7697

402

9623

900

9874

869

1957

801

1877

284

Assam

3565

349

3604

326

2686

136

2771

995

1951

967

2000

504

1275

351275

282876

82

2988

23

3704

649

3700

224

Bihar

1681

6652

1707

5806

9462

237

9491

206

5799

023

5887

902

5002

835

4966

124

5476

438

5598

131

5082

942

5135

743

Delhi

8589

731

8666

307

8686

907

8653

048

8340

459

8415

704

4856

373

4640

386

4585

267

4736

999

2364

118

2444

970

Gujarat

6814

699

6867

664

8170

553

8309

872

1576

1617

1594

7610

3857

732

3754

102

7713

978

7944

883

5914

28

6252

41

Haryana

2275

808

2349

201

4260

263

4265

016

4343

430

4368

831

2867

646

2848

288

3431

364

3559

508

5835

21

5943

08

Himachal P

radesh

1777

668

1806

122

1872

074

1837

334

4229

62

4339

69

4005

063998

134292

35

4424

71

6931

85

7256

63

J & K

2026

209

2052

589

5205

31

5373

78

6859

29

7009

96

1167

351181

691625

60

1708

63

1575

250

1606

563

Karnataka

1527

8989

1535

3628

8045

188

8069

504

6614

514

6684

965

7014

596

7101

538

5528

696

5599

658

1731

093

1700

038

Kerala

3501

206

3507

520

4253

749

4266

119

5825

894

5838

915

2376

342

2391

961

7402

840

7398

445

2415

121

2351

517

Kolkata

3801

989

3830

230

5342

181

5403

634

4445

740

4419

352

3156

152

3029

610

1210

597

1283

469

1776

039

1792

172

Madhya Prade

sh

9602

627

9635

114

1228

6268

1228

8542

3790

520

4005

622

4950

199

4957

233

1331

5056

1353

2307

8345

63

8624

74

Maharashtra

9449

972

9646

997

1084

4584

1090

1353

1265

9140

1285

3290

9198

909

8676

060

1497

2162

1513

9241

1205

671

1222

626

Mum

bai

3714

217

3719

123

8761

138

8714

220

6002

506

5902

412

5177

457

4673

113

2818

843

2866

050

1202

151

1252

429

North East

2194

615

2228

206

9062

54

9551

46

9164

93

9280

00

7568

77540

71919

18

1959

71

2371

230

2377

169

Odisha

6003

168

6175

241

4700

014

4699

435

2514

974

2552

046

2513

609

2515

623

9767

58

1028

637

2759

507

2873

435

Punjab

6926

186

6944

261

4914

581

4953

072

4454

905

4504

979

3097

240

3168

079

5194

458

5365

154

8738

83

8899

84

Rajasthan

1376

8431

1401

1209

7673

753

7694

048

9409

930

9257

085

3927

410

3802

547

3762

139

3950

149

1405

751

1523

698

Tam

il Nadu

1326

6658

1329

2922

8653

682

8742

594

1223

5508

1224

8080

4511

465

4549

243

2018

098

2084

095

2186

8334

2207

4747

U.P.(E)

1401

9449

1429

5939

1249

9488

1258

6458

1455

9374

1468

9390

4640

824

4659

549

7054

244

7310

273

2365

414

2460

822

U.P.(W

) 6625

502

6631

344

9705

091

9797

371

9464

037

9504

231

4933

645

4736

206

9995

876

1021

4038

2038

307

2103

031

West B

engal

9034

631

9077

805

7434

027

7620

750

1161

8854

1167

2101

3208

778

2999

751

1975

171

2115

580

3062

163

3061

930

Total

1769

5416

4 17

8777

131 151028199

152001566

148602105

149440176 83

7188

6381

8877

3210

8127

280 11

0709

614 62

4621

21 63

2560

68

Net Addition

18

2296

7

97

3367

8380

71

-183

1131

2582

334

79

3947

13

Page 30: Maninder Us Telecom

Wireles

s Subscriber Bas

e Annex

ure-I

Pag

e 2 of 3

Group

BSNL

MTNL

Uninor

Sistema

Loop

Video

con

Circle

Jan-12

Feb

-12

Ja

n-12

Feb

-12

Ja

n-12

Feb

-12

Jan-12

Feb

-12

Jan-12

Feb

-12

Ja

n-12

Feb

-12

Andhra Pradesh

8940

056

8949

035

0

0

3142

932

3468

012

6188

666217

370

0

1093

4

1093

3

Assam

1604

587

1250

394

0

0

127

172

1134

1229

325

325

0

0

Bihar

6033

464

6110

271

0

0

4571

564

4655

224

1572

850

1580

729

364

364

2029

9

2009

5

Delhi

0 0

2826

624

2851

834

0

0 1074

913

1127

867

0 0

0

0

Gujarat

4135

930

4187

494

0

0

3052

199

3463

080

1288

361425

8773

73

1234

333

1318

783

Haryana

2994

325

2986

988

0

0

205

273

2132

612069

2493

88

8521

65

9235

38

Himachal P

radesh

1716

774

1709

085

0

0

61

94

313

544

0 0

7901

5

7870

9

J & K

1014

332

1036

358

0

0

40

75

516

297

0 0

0

0

Karnataka

6665

782

6759

761

0

0

1823

105

1986

471

2074

851

2127

990

618

653

1198

7

1190

0

Kerala

6955

611

7046

043

0

0

7229

23

7138

53

6222

286307

580

0

2380

83

2405

95

Kolkata

2401

422

2413

871

0

0

1698

321

1761

685

8160

778413

832348

2369

2966

4152

Madhya Prade

sh

4854

454

4725

504

0

0

883

845

1888

2071

270

307

1158

819

1234

316

Maharashtra

6018

121

6121

687

0

0

4080

333

4507

648

7122

657314

10357

413

1368

1

1383

0

Mum

bai

0 0

2912

105

2921

883

1424

832

1481

997

6772

375036

623240

766

3252

030

9802

78

1024

215

North East

1558

450

1587

344

0

0

51

62

188

205

41

41

0

0

Odisha

4308

907

4371

415

0

0

1347

034

1379

335

434

519

966

965

1067

0

1067

3

Punjab

4742

674

4727

579

0

0

319

399

691

808

147

145

0

0

Rajasthan

5662

270

5656

771

0

0

383

645

2351

655

2355

410

400

421

1057

0

1084

9

Tam

il Nadu

9546

801

9597

504

0

0

1677

247

1998

367

1657

076

1752

738

0 0

1179

228

1248

902

U.P.(E)

1018

9190

1015

7472

0

0

7054

485

6973

229

4565

604871

000

0

1672

2

1671

9

U.P.(W

) 4729

667

4773

450

0

0

4560

885

4848

913

4529

644923

968

8

8827

8825

West B

engal

3563

744

3583

168

0

0

3640

447

3900

324

1715

463

1773

784

0 0

2015

2

2057

5

Total

9763

6561 97

7511

94

5738

729

5773

717 38

7983

76 41

1407

03 15

1502

6615

3821

4832

4677

6 32

5820

2

5848

729

6197

609

Net Addition

11

4633

3498

8

23

4232

7 23

1882

11

426

34

8880

14

Page 31: Maninder Us Telecom

Wireles

s Subs

criber Bas

e

Annex

ure-I

Pag

e 3 of 3

Group

S-Tel*

HFCL

Etisa

lat

Total

Circle

Jan-12

Feb

-12

Ja

n-12

Feb

-12

Ja

n-12

Feb

-12

Jan-12

Feb

-12

Net Add.

Andhra Pradesh

0 0

0

3486

8

1621

7 6607

0782

6658

8729

5179

47

Assam

7999

2 7999

2

0

0

0 1400

9483

1383

5512

-17397

1

Bihar

2029

624

2029

624

0

4122

2

1697

4 6190

9514

6256

8193

6586

79

Delhi

0 0

0

7592

10

4237

31

4208

3602

4196

0846

-12275

6

Gujarat

0 0

0

3271

2

1684

0 5149

4090

5257

8229

1084

139

Haryana

0 0

0

1517

1

7161

2183

7252

2211

0124

2728

72

Himachal P

radesh

4549

24

4549

24

0

0

0 7846

717

7888

728

4201

1

J & K

0 0

0

0

0 6102

102

6223

288

1211

86

Karnataka

0 0

0

2971

2

1424

0 5481

9131

5541

0346

5912

15

Kerala

0 0

0

1209

7

5435

3432

6094

3439

1161

6506

7

Kolkata

0 0

0

0

0 2465

3832

2478

1927

1280

95

Madhya Prade

sh

0 0

0

7819

0

3555

7 5087

3737

5127

9892

4061

55

Maharashtra

0 0

0

3505

1

1556

8 6919

0246

6983

0123

6398

77

Mum

bai

0 0

0

4699

09

1437

32

3738

1439

3645

4866

-92657

3

North East

3208

3 3208

3

0

0

0 8247

010

8379

634

1326

24

Odisha

8336

65

8336

65

0

0

0 2596

9706

2644

0989

4712

83

Punjab

0 0

1292

888

1379

754

1844

0

8986

3151

6412

3194

3200

4267

88

Rajasthan

0 0

0

3598

7

1875

6 4800

8679

4828

1588

2729

09

Tam

il Nadu

0 0

0

3191

5

1344

8 7664

6012

7760

2640

9566

28

U.P.(E)

0 0

0

5024

6

2530

0 7290

5996

7366

2251

7562

55

U.P.(W

) 0

0

0

4713

3

2034

6 5256

1942

5313

0159

5682

17

West B

engal

0 0

0

0

0 4527

3430

4582

5768

5523

38

Total

3430

288

3430

288

1292

888

1379

754

1691

863

7822

91 903

7272

08 91

1168

193

7440

985

Net Addition

0

86

866

-909

572

74

4098

5

*

Th

e su

bsc

rib

er f

igu

res

of S

Tel

are

tak

en a

s on

Jan

uar

y 2

01

2,

du

e to

non

-su

bm

issi

on o

f in

form

atio

n f

or F

eb-2

01

2.

15

Page 32: Maninder Us Telecom

Pro

port

ion o

f V

LR

on t

he

dat

e of

Pea

k V

LR

in t

he

mon

th o

f Feb

ruar

y, 2012 (%

)

Annex

ure

-II

Circle

Aircel

Bharti

BSNL

Etisalat

HFCL

Idea

Loop

MTNL

Reliance

S Tel*

Sistema

Tata

Uninor

Video

con

Vodafone

Total

(Except

CDMA)

Andhra Pradesh

60.95

94.99

70.65

0.06

92.86

58.45

59.50

63.57

57.94

4.45

66.33

76.48

Assam

78.37

95.65

70.72

94.52

7.69

68.88

52.77

87.88

74.34

90.03

82.13

Bihar

45.90

97.84

35.44

9.24

94.03

72.71

24.58

38.02

47.52

57.14

6.85

99.47

72.52

Delhi

53.53

84.00

64.97

87.00

40.67

78.21

27.13

49.45

93.79

74.85

Gujarat

87.42

87.79

58.43

1.66

91.25

64.90

43.01

62.21

59.33

47.50

87.84

77.51

Haryana

33.76

94.12

51.54

91.32

52.63

61.44

40.80

93.80

71.13

Him

achal

58.60

95.09

60.18

92.42

61.52

12.7

35.12

14.43

97.74

69.37

Pradesh

J & K

84.08

96.13

65.67

91.37

68.95

68.51

77.21

82.81

Karnataka

39.68

92.62

53.52

1.10

91.13

66.05

62.01

63.80

52.40

0.61

77.60

74.33

Kerala

40.85

84.85

64.83

3.55

94.42

57.04

49.25

59.46

33.67

24.60

83.17

71.31

Kolkata

53.59

87.10

33.92

72.73

2.15

67.40

52.71

68.10

49.90

82.11

67.41

Mad

hya Prades

h

57.53

90.63

56.73

3.57

100.85

36.48

72.03

50.65

68.00

43.48

74.58

80.55

Mah

arashtra

42.83

87.98

67.34

0.71

96.42

63.29

49.26

63.61

64.11

2.45

91.51

79.00

Mumbai

52.66

86.10

54.99

82.15

41.61

32.02

70.02

27.17

47.78

56.14

46.84

82.47

63.74

North East

69.83

96.01

22.38

90.95

9.76

57.30

33.24

75.64

82.91

68.23

Orissa

50.06

95.36

58.64

65.37

2.07

60.83

28.88

119.27

53.37

51.09

1.15

84.97

67.62

Punjab

55.17

91.48

51.40

0.23

43.79

91.49

13.10

56.27

41.46

56.38

92.32

73.63

Rajasthan

94.17

93.43

50.35

0.00

107.66

15.20

60.98

45.59

53.40

4.35

87.45

77.71

Tam

il Nad

u 51.24

93.40

45.65

1.61

65.32

54.68

49.91

56.75

46.01

42.85

88.22

64.39

U.P.(E)

68.80

96.45

43.46

0.39

93.62

68.33

46.37

52.55

62.54

12.18

91.00

75.68

U.P.(W

) 61.40

79.78

48.61

0.74

92.45

61.20

47.58

51.73

57.42

3.72

92.17

72.59

West Ben

gal

51.85

86.73

48.23

78.54

74.01

62.58

38.12

53.74

2.06

90.79

72.97

Total

55.79

91.88

53.11

45.86

43.79

92.90

41.55

36.29

65.39

28.53

48.66

57.31

57.06

42.47

87.68

73.60

* T

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. 16

Page 33: Maninder Us Telecom

Wireline Subscriber Base

Ann

exure-III

Group

BSNL

MTN

L

Bharti

Reliance

Ta

ta

HFCL

Sistema

Vodafone

Total

Circle

Jan-12

Feb

-12

Jan-12

Feb

-12

Jan-12

Feb

-12

Jan-12

Feb

-12

Jan-12

Feb

-12

Jan-12

Feb

-12

Jan-12

Feb

-12

Jan-12

Feb

-12

Jan-12

Feb

-12

Net Add.

And

hra Prade

sh

1964

273

1967

206

12

5048

1250

7088

499

8879

5

1711

2017

2718

0750

2348940

2354539

5599

Assam

2283

8522

8179

26

0225

82

230987

230761

-226

Bihar

5943

1059

4198

4827

4859

10

149

9730

609286

608787

-499

Delhi

0

15

5664

3 15

5924

210

7417

610

7422

2.4

1824

49

1830

27

7704

078

189

0

7710

2890308

2902390

1208

2.431

Gujarat

1630

181

1619

725

54

949

5500

611

0702

1099

43

6597

466

760

0

301861806

1851464

-103

42Haryana

5484

0354

5324

2376

923

812.688

4876

4956

19

107

1968

9

596155

593782

-237

3.313

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3059

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4013

4462

4462

18

6119

03

312308

310378

-193

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2051

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4165

33

433

4

205434

204499

-935

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1982

030

1976

209

48

9563

4896

4011

0870

1105

90

1213

4512

3100

01590

2703808

2701129

-267

9Kerala

3078

823

3073

401

55

473

5548

755

991

5620

2

1268

112

317

3202968

3197407

-556

1Kolkata

9775

9296

9509

9232

392

335

8158

1 81

377

3043

131

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0

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1181927

1174993

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4Mad

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4884

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301136599

1134975

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4Mah

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2256

119

2247

892

70

049

7008

8.3

1013

47

1018

16

2254

1923

0666

0210

2652934

2650672

-226

1.7

Mum

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00

1899

470

1896

006

3306

3133

0679

2303

07

2308

12

5428

1854

5869

05700

3003226

3009066

5840

North East

2529

4025

2383

24

924

4

253189

252627

-562

Odisha

4531

4945

1438

4130

4143

72

2270

44

0

30464501

462655

-184

6Pun

jab

1117

328

1100

762

10

5423

1054

2732

348

3168

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1520

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1469954

1453472

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1071

837

1064

300

39

164

3917

625

389

2570

3

5545

5795

47395

48070

090

1189330

1183134

-619

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0935

825

0228

9

48

4146

4841

8714

6962

1477

27

6176

162

691

0

660

3202227

3197554

-467

3U.P.(E)

1269

513

2216

50

50

294

5032

3.063

4034

6 40

588

1312

513

124

1373278

325685

-104

7593

U.P.(W)

7721

2817

9651

8

24

080

2410

5.25

5689

5690

75

1875

18

809415

1833831

1024

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West B

engal

6850

8268

3475

2263

2290

61

1359

10

693458

691675

-178

3To

tal

22752984

22651180

3456113

3455248

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3259938

1268697

1269694

1408081

1423544

199315

200222

47395

48070

017580

32392038

32325476

-66562

Net Addition

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-865

485

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15463

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17

Page 34: Maninder Us Telecom

Annexure IV

VLR Subscribers in the Wireless Segment Home Location Register (HLR) is a central database that contains details of each mobile phone subscriber that is authorized to use the GSM core network. The HLRs store details of every SIM card issued by the mobile phone operator. Each SIM has a unique identifier called an International Mobile Subscriber Identity (IMSI), which is the primary key to each HLR record. The HLR data is stored for as long as a subscriber remains with the mobile phone operator. HLR also manages the mobility of subscribers by means of updating their position in administrative areas. It sends the subscriber data to a Visitor Location Register (VLR). Subscriber numbers reported by the service providers is the difference between the numbers of IMSI registered in service provider’s Home Location Register(HLR) and sum of other figures as given below:-

1 Total IMSI's in HLR (A)

2 Less: (B=a + b + c + d + e)

a. Test/Service Cards

b. Employees

Stock in hand/in

Distributional Cannels

c. (Active Card)

Subscriber Retention

d. period expired

Service suspended pending

e. disconnection

3 Subscribers Base (A-B)

Page 35: Maninder Us Telecom

18

Page 36: Maninder Us Telecom

Visitor Location Register (VLR) is a temporary database of the subscribers who have roamed into the particular area, which it serves. Each base station in the network is served by exactly one VLR; hence a subscriber cannot be present in more than one VLR at a time. If subscriber is in active stage i.e. he is able to send/receive calls/SMSs he is available both in HLR and VLR. However, it may be possible that the subscriber is registered in HLR but not in VLR due to the reason that he is either switched-off or moved out of coverage area, not reachable etc. In such circumstances he will be available in HLR but not in VLR. This causes difference between subscriber number reported by the service providers and numbers available in VLR. The VLR data calculated here is on the basis of active subscribers in VLR on the date of Peak VLR of the particular month for which the data is being collected. This data is to be taken from the switches having the purge time of not more than 72 hours.

--------- 19

Page 37: Maninder Us Telecom

37

GROWTH OF TELECOM IN INDIA

Page 38: Maninder Us Telecom

38

• 1994 National Telecom Policy – 1994 Announced • 1995 Kolkata became the first metro to have a (Aug) cellular network

• 1997 Telecom Regulatory Authority of India was Setup

• 1999 Tariff rebalancing exercises gets Initiated • 1999 National Telecom Policy – 99 announced (Mar) • 1999 License fee (revenue share) reduced from (Aug) provisional 15% to 12%, 10% & 8% on

Circle wise basis (A type, B type & C type circles)

• 2000 TRAI Act amended & separate tribunal Proposed

• 2001 TDSAT started functioning (Jan) • 2001 Policy announced for additional licenses (Jan) in Basic and Mobile Services

• 2001 Limited mobility allowed to Basic Services (Jan) (CDMA spectrum allotted to Basic Service Operators)

• 2002 BSNL entered in to GSM cellular (Oct) operation w.e.f 19th October, 2002.

Made incoming call free & initiated tariff equalization process Tariff for GSM cellular mobiles reduced.

Page 39: Maninder Us Telecom

39

• 2003 Unified Access (Basic & Cellular) (Nov) Service License (USAL) introduced as a first Step towards Unified License Regime.

Technology neutral and allows provisioning any kind of service.

• 2004 License fee reduced by 2% across the (Apr) board for all the access licenses. • 2008 Issue of 3G guidelines for spectrum (Apr) allocation through auction.

Exponential Growth

Page 40: Maninder Us Telecom

40

During the month of January 2012, the operators added 9.59 million subscribers.

Particulars Wireless Wireline Total Total subscribers 903.73 32.39 936.12 Total Net addition 9.88 -0.29 9.59 % of monthly growth 1.11% -0.90% 1.04% Urban subscribers 591.1 24.73 615.83 Rural subscribers 312.62 7.67 320.29 Tele density 74.89% 2.68% 77.57% Urban teledensity 162.06% 6.78% 168.84% Rural teledensity 37.13% 0.91% 38.04% Share of Urban subscriber 65.41% 76.32% 65.79% Share of Rural subscriber 34.59% 23.68% 34.21%

Mobile Services

• Mobile connections are provided on GSM and CDMA technology

Page 41: Maninder Us Telecom

41

• GSM Connections increased from 12.68 Million in March 2007 to 219.297 Million in July 2008. • CDMA connections rose from 0.31 Million in March 2003 to 76 Million in July 2008. • Ratio of GSM and CDMA subscribers is 3:1 • Mobile connections are provided on GSM and CDMA technology. • GSM Connections increased from 12.68 Million in March

2007 to 219.297 Million in July 2008. • CDMA connections rose from 0.31 Million in March 2003 to 76 Million in July 2008. • Ratio of GSM and CDMA subscribers is 3:1

Growing Share of Private Sector

• Share of private sector in total Connections has steadily increased from 20.9% in 2003 to 75.92% in July 2008.

• Private Sector is mainly active in Wireless Segment.

Page 42: Maninder Us Telecom

42

• Private Sector’s contribution in Wireline Segment is just 11.6%.

Growing Share (%) of Private Sector

TELECOM SERVICE PROVIDERS

• There are 23 Licensed Service Areas. • 12 Service Providers are providing phone services in these

areas. • Two Public Sector Operators are MTNL and BSNL. • MTNL providing service in Delhi + Mumbai only.

20.9

39.27

47.05

57.01

65.32

75.92

0

10

20

30

40

50

60

70

80

2003 2004 2005 2006 2007 2008 July

Share (%)

Page 43: Maninder Us Telecom

43

• BSNL providing service in 21 out of 23 LSAs excluding Delhi and Mumbai.

• There are six major Telecom players i.e. BSNL, Airtel, Reliance, Vodaphone, Tata Tele & Idea.

PERCENTAGE MARKET SHARE OF MAJOR TELECOM PLAYERS IN INDIA

MAJOR PLAYERS’ DATA

8.368.33

15.1215.79

22.0622.38

0

5

10

15

20

25

30

BSNL AIRTEL RELIANCE VODAPHONE TATA TELE IDEA

Page 44: Maninder Us Telecom

44

BSNL AIRTEL RELIANCE IDEA

Customer

Base

(in millions)

72.8 71.8 51.4 27.2

Annual

Revenues

(in US $ bn)

10 6.9 3.75 1.1

Annual

Profit

(in US $ bn)

1.9 1.7 1.3 0.1

Mobile Tariffs in India one of the Lowest

Page 45: Maninder Us Telecom

45

TELECOM TARIFF & REVENUES

0.23

0.22

0.19

0.17

0.16

0.11 0.11 0.11

0.09

0.05 0.05

0.04

0.03

0.02

0

0.05

0.1

0.15

0.2

0.25

Belgium

Italy

UK

France

Brazil

Philippines

Taiwan

Argen

tina

Malayasia

Hong Kong

Thailand

Pakistan

China

India

Page 46: Maninder Us Telecom

46

• Telecom Tariffs have fallen to very low level during past five

years. • Local call tariff from mobile calls has seen steady decline

from Rs. 16 per minute to Rs. 0.50 per minute

• Public Sector has played crucial role in bringing down mobile tariff.

• Despite low tariffs, telecom sector has shown positive

financial results. • Gross revenues for the sector have grown at compound

annual rate of about 21% and stands at US $ 26 Billion – 34% contribution of Public Sector and 66% of Private Sector.

REGULATORY REGIME

Page 47: Maninder Us Telecom

47

• Tariff under forbearance except for fixed rural line services, National roaming in mobile service and Leased Circuits.Operators to report tariff plans to TRAI within 7 days from the date of implementation.Tariff once offered can not be hiked for minimum period of 6 months. Lifetime / unlimited tariff plans to be available to subscribers during the period of current / renewed license.

• No chargeable Value Added Services to be provided to a

customer without explicit consent. Publication/ advertisement of tariff for consumer information shall contain minimum essential information. Websites of the service provider to contain complete details of the tariff plans as well as financial implications for various usage slabs.

• Customers to be informed in writing, within a week of activation of service, the complete details of his tariff plan.Quality of Service Standard bench marks to be ensured by Operators.

Page 48: Maninder Us Telecom

48

Opportunities & New revenue streams

• BPO & KPO business is growing fast: Telecom can ride on it. • As globalization is increa Opportunities & New revenue

streams sing, more percentage of global business for Indian telecom.

• Technologies like NGN, 3G, Wi-MAX, will open up new frontier of business.

Services Through 3 G

Services ON DEMAND DATA / VOICE Data connectivity on the move,Quad play i.e Voice, Video, Data and mobility with suitable core network. E-mail and Web services on demand for SME VPN service for group of customersGaming, Video Services like Live TV, E-governance, E-health, E-education Internet Access on the move Video Messaging and rich data appliactions

Page 49: Maninder Us Telecom

Service Performance Guarantee IP services with QoS, and support concurrently 3 types of QoS for one subscriber. Class of service: Support for different types of data delivery services which are-UGS,RTBandwidth management: support flexible bandwidth assignment and the inter-user QoS

Service Performance Guarantee

IP services with QoS, and support concurrently 3 types of QoS for

Class of service: Support for different types of data delivery UGS,RT-VR,NRT-VR,BE and ERT-VR

Bandwidth management: support flexible bandwidth assignment user QoS

49

Service Performance Guarantee

IP services with QoS, and support concurrently 3 types of QoS for

Class of service: Support for different types of data delivery VR

Bandwidth management: support flexible bandwidth assignment

Page 50: Maninder Us Telecom

50

NEW OPPORTUNITIES – VAS

• Value added services like M-Commerce, M-Marketing, Special

• Information, Ring tones, etc. offer venues of additional revenue.

• Annual Revenue US $ 1.2 billion (approx.) • VAS contributes 10 – 14% of total telecom revenue [source

Voice-Data]. • Non-voice revenue increasing. • Present contribution > 50% through SMS (P to P). • Revenue from other value added services growing [IVR,

PRBT, Games, Data].

PROJECTIONS:

• Revenue Expected by 2015 US $ 5.2 Billion. • Applications which can ride on SMS,Mobile Commerce (Bill

Payment, Prepaid top-up, ticket booking) • Search (on Voice, SMS, WAP) • Location Based Services, Music based Services, IVR

Page 51: Maninder Us Telecom

MNP – OPPORTUNITY as well as THREAT for Operators

• It will change the market dynamics.The perceptionownership of customer will

• New innovations will be needed for keeping attached to service

• Enterprise business will be the key target and face intense competition

OPPORTUNITY as well as THREAT for Operators

It will change the market dynamics.The perceptionownership of customer will have a paradigm shift.

ons will be needed for keeping attached to service Enterprise business will be the key target and face intense competition

51

OPPORTUNITY as well as

It will change the market dynamics.The perception of have a paradigm shift.

ons will be needed for keeping customer

will

Page 52: Maninder Us Telecom

52

Internet & Broadband Services

• No. of Broadband Connections have grown from 0.02 Million in March 2004 to 4.57 Million in July 2008.

• BSNL is the largest Broadband Internet Service Provider with 53 % Market Share. 589 District Hqrs., 2698 Block Hqrs., 3261 Cities & 30124 Villages have been covered by Broadband.

• In INDIA, ISPs are providing Broadband Service on DSL, Cable Modem, Ethernet LAN, Fibre, Radio, Leased Line etc.

Telecom Growth- the way ahead

• Network expansion o 250 million by 2007 - Already achieved o 600 million by 2012

• Rural connectivity o 100 million by 2010 o 200 million by 2012

• Broadband o 20 million broadband connections and 40 million

internet connections to provide by 2010 o Broadband connections to provide on demand across

the country by 2012.

Page 53: Maninder Us Telecom

53

Challenges in Telecom Sector

• No. of operators are increasing per circle. • ARPUs are going down. • Cost/ Customer is very high in rural areas. • Spectrum – a scare commodity. • Infrastructure readiness in rural. • PC prices are very high. • Availability of Contents in local language. • International Bandwidth is costly.

Broadcasting & Cable Services

• Like Telecom Sector, Broadcasting & Cable Services have been opened for Private participation.

• Broadcast & Cable services being provided through All India Radio, FM Channels, Community Radio Stations, Cable TV, Satellite TV Channels, DTH & IPTV. Multi System Operators (MSOs) across the country providing Cable TV services.

• MSOs are carrying maximum 133 Free-to-Air Channels, 95 Pay Channels & 8 Local Channels on their networks . IPTV Service has been recently soft launched in Gurgaon, Faridabad & Noida by BSNL.

• BSNL plans to launch IPTV Service in 100 Cities by March 2009.

Page 54: Maninder Us Telecom

54

U.S. INDUSTRY ANALYSIS

How it all started…

1982 In January, AT&T ends a long-running antitrust suit by the US Department of Justice by agreeing to break itself up into a national long-distance carrier and seven “Baby Bells.” The breakup is scheduled to happen in 1984.

1984 The breakup takes place. AT&T’s old local phone companies become Ameritech, Bell Atlantic, BellSouth, NYNEX, Pacific Telesis, Southwestern Bell, and US West.

Page 55: Maninder Us Telecom

55

1986 GTE, an independent phone company with roots going back to 1918, spins off its GTE Sprint division and merges it with US Telecom, which has roots going back to 1899. The merged company begins offering long-distance service in competition with AT&T under the name Sprint (which, incidentally, stands for “Southern Pacific Railroad Intelligent Network of Telecommunications”).

1987 Wireless phone company Fleet Call is founded. It changes its name to Nextel in 1993. SBC acquires Cellular One, the cellular business of Metromedia.

Page 56: Maninder Us Telecom

56

1988 Pacific Northwest Cellular is founded. It later changes its name to VoiceStream.

1994 AT&T acquires wireless pioneer McCaw Cellular, joint owner with Southwestern Bell of the Cellular One brand name, and begins using the AT&T name rather than Cellular One (but Southwestern Bell continues to use the Cellular One name) . Pacific Telesis spins off its wireless services into AirTouc

Page 57: Maninder Us Telecom

57

1995 Southwestern Bell changes its name to SBC.

1996 In the first major reversal of the Bell breakup, Bell Atlantic acquires NYNEX.

Page 58: Maninder Us Telecom

58

1997 SBC acquires Pacific Telesis. WorldCom, a long-distance company with roots dating to 1983, acquires MCI, which goes back to 1963, to form MCI WorldCom.

1999 SBC acquires Ameritech. AirTouch merges with Vodfone of the UK to form Vodafone Airtouch.

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59

2000 QWEST (founded in 1996) acquires US West. Vodafone Airtouch and Bell Atlantic form a joint venture called Verizon Wireless. Bell Atlantic merges with GTE to form Verizon.

2001 SBC and BellSouth combine their wireless businesses into a company called Cingular.

Page 60: Maninder Us Telecom

60

2002 AT&T (which has been trying to turn itself into a long-distance/wireless/cable megaconglomerate) spins off its wireless business to form AT&T Wireless Services. German telecommunication giant Deutsche Telekom, which had acquired VoiceStream in 2001, changes the U.S. operations’ name to T-Mobile.

2003 WiMAX provider Clearwire is founded. After a massive accounting scandal, WorldCom changes its name to MCI.

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61

2004 Cingular acquires AT&T Wireless. Qwest, which had offered its own wireless service, sells off its assets and becomes a reseller for Sprint (in 2008, it switches to Verizon Wireless). (It continues to offer landline service, but I’m removing it at this point from this accounting.)

2005 Sprint buys Nextel to form Sprint Nextel. SBC acquires AT&T and adopts its name. Verizon acquires MCI.

Page 62: Maninder Us Telecom

62

2006 AT&T acquires BellSouth and renames the latter’s Cingular wireless service to AT&T.

2008 Sprint Nextel’s wireless broadband unit XOHM merges with Clearwire, giving Sprint 54% ownership of the combined company. (Clearwire is still in business, but I’m removing it from this accounting since it’s majority-owned by Sprint.)

2011 AT&T agrees to buy T-Mobile US from Deutsche Telekom, in a deal expected to close next year.

Whew. At this point, there aren’t many theoretical mergers left to happen, although Sprint (which was supposedly angling to buy T-Mobile before AT&T stepped in) could end up being bought by somebody. And hey, if the Department of Justice feels like stepping in and imposing competition before we end up with one phone company again, there’s a handy template. We could just go back to this:

Page 63: Maninder Us Telecom

MARKET SATURATION

• Four major mobile telephony operators:

o AT&T Wirelesso Sprint PCS o Verizon Wirelesso Cingular Wireless

In 2001 over $65 billion in revenues was generated with apenetration rate of about 45%

U.S. Market Share Data

0%

Small Providers

Verizon

Cingular

At& T

Sprint

Nextel

Voice stream

Alltel

MARKET SATURATION

Four major mobile telephony operators: AT&T Wireless

Verizon Wireless Cingular Wireless

In 2001 over $65 billion in revenues was generated with apenetration rate of about 45%

U.S. Market Share Data

5% 10% 15% 20%

63

In 2001 over $65 billion in revenues was generated with a

U.S. Market Share Data

20% 25%

Page 64: Maninder Us Telecom

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GROWTH RATE

1987 – Cellular telephone subscribers exceed 1 million 1999 – Spending on wireless communications services totaled $45.2 billion 2002 – 268 million people in the U.S. live in counties with access to 3 or more different operators 2003 – Spending projected increase to $75.6 billion

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Porter’s Five Forces Analysis

Threat of Entry:

Prior to Mid-nineties, entry into fixed line telecom business was very difficult owing to several factors, Firstly it was a very capital intensive industry, entry into this industry meant that the firms needed access to huge amount of capital mainly to cover the fixed costs to lay and maintain a physical network (exchanges, fiber optic cables etc) to the premises of customers. In addition to that firms needed to get regulatory approval/licenses from the Federal Communications Commission (FCC), which was both costly, and a tedious affair. Hence the companies in this industry mostly tended to monopolies strictly regulated by the government subject to price controls and moderate to heavy taxation. Deregulation and the telecom act of 1996 provided a significant reduction in barriers as the new entrants did not need to own their networks.The technological changes also provided impetus to the significant reduction of barriers; Internet Telephony provided a way for several firms to enter the market and compete with the incumbents without the significant upfront fixed costs. One of the notable entrants into the business is Vonage, this firm began offering its version of IP telephony product since 2003. The entry of new progressively become very easy, in fact it has become so easy that there are company’s like RTC Factory claim to provide services that can let firms start their own branded fixed line IP telephony voice business within 6-8 weeks in 10 easy steps.

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Supplier Power:

The Suppliers in this industry are the manufacturers of telephone switching /switch board equipment, fiber optic cables, network equipment, and billing software makers. The prominent names in this industry include Cisco, Alcatel-lucent, Nokia, Nortel, Motorola and Tellabs etc. After the deregulation of downstream service providers and the technological breakthrough in IP networks, Telecom equipment makers began to ramp up manufacturing in order to meet the huge anticipated demand, however aftermath the dot com bubble, demand did not pan out as expected and led to overcapacity and eventually demise of several firms. The evidence of decline can be gauged from the fact that the telecommunications industry Association (TIA) reported that in 2001, a cumulative decline of $30.5 billion in revenues4 [Encyclopedia of American Industries]. With excess capacity and falling demand, the suppliers have do not have the power and clout to negotiate with the telecom behemoths. However with the demand in recent years has started to pick up with fixed line providers deciding to install fiber based networks to provide faster data and video services.

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Power of Buyers:

With increased choice of several technologies and means of communication available and entrance of several new firms buyer power is been increasing. The consumer now has access to several means of communication like email, instant messaging which are diminishing the importance voice services. Residential consumer also benefits with local number portability (A regulation from FCC which mandates the carriers to move the phone number when the customer switches to a different carrier). This feature makes switching costs negligible. The business segment however is prone to significant switching costs as they rely on more customized products which are tailored to their businesses and most times are locked into long-term contracts.

Threat of Substitutes:

Several substitute products and services have emerged to fixed line telephones as a result of technological breakthroughs. Some of these are more convenient and offer far greater value to the consumer and have diminished the importance of fixed line phones. Substitutes include IP Telephony, Mobile phones, Satellite, Email, and Instant Messaging etc. Among the several substitutes that have emerged, IP telephony has emerged as the biggest threat. Applications like Skype have been extremely popular among younger generation users and are fast emerging as preferred means of communication.Wireless phones are also getting cheaper each year over the last decade; this has provided consumers with more convenience and mobility, to the extent that the younger demographic now considers a fixed line phone redundant.

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Industry Rivalry:

Industry rivalry has become extremely intense with the emergence of new competing firms leading to price cuts across the industry. Voice offerings are turning into commodities with the business going to lowest cost provider.

Major Players in U.S.

• AT&T • Verizon Wireless • Cingular • Sprint

AT&T

� Competitive monthly fee � Best home area coverage � Best national coverage � Unlimited night and weekend minutes � Best rates international calling � Good website – compared to Verizon

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Verizon

� Largest wireless provider � Lowest monthly fee � Good home area coverage � Good national coverage � Second best international calling � Easy to navigate website/ well organized

Sprint

� Smallest of four companies � Average monthly charges � Higher priced phones � Minimal home and national coverage � Minimal/non-existent international calling � Poor website – not easy to navigate and technical problems

Competitive Advantages Summary

� AT&T - Best coverage, unlimited nights and weekends

� Verizon – Best monthly charges, good coverage, largest supplier

� Cingular – No roaming calling from anywhere � Sprint- No competitive advantage noted in comparison

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U.S. Environmental Analysis

The Demographic Environment

• As of December 2009, 128.5 million subscribers (45% of

population) • 268 million people (94% of the total population) have three

different operators offering mobile phone service • 229 million people (80 % of the population) live in countries

with five or more mobile operators • Nearly 58% of Americans 12 and older own a mobile phone • Geographic: Rural Vs. Urban

§ Virtually no difference in price § Usage is significantly different

The Sociocultural Environment

• “Cutting the Cord”—growing evidence proves more people

are canceling service from their home telephone provider • Almost one in five mobile phone users regard their wireless

phoane as their primary phone • Even though average pricing has been increasing since

1999, usage has increased to an average of 385 minutes. An increase of 51% from the prior year, during the same month

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U.S. SWOT Analysis

Strengths

� Lows prices/affordability � Variety of service providers and calling plans � Calling plan benefits � free long distance � wireless web � PDA-like features � Easy of use

Weaknesses

� Customer service � Service provider web sites not user friendly � Mass marketing strategy � Need to market to different segments � Need to differentiate from competitors � Service contracts

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Opportunities

� Wireless web � Bundling � Bundle phone with accessories � Business to Business market � Work on current weaknesses � improve customer service � practice differentiated marketing � Improve service provider web sites

Threats

� Satellite communication � Current infrastructure would be rendered obsolete � Two-way radios � Nextel � Government regulations

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Key Success Factors in Telecommunications Industry

Bundling:

Consumers value convenience more than anything else. A company’s ability to provide multiple services like wireline / wireless/ high speed internet / video at an attractive price not only provides value to the consumer but also helps the company’s bottom-line due to reduced customer acquisition costs. It also is widely believed in the telecom industry and supported by the data, that churn reduces drastically for customers subscribed to a bundle as a result of increased switching costs.

Network Quality:

One of the key difference between the old generation PSTN (public switched telephone network) used by telecom companies versus the new generation IP networks used by both the cable providers and VoIP providers is the ability to receive phone calls on the PSTN networks when the power is out. There is difference in quality of the voice transmitted, however the gap is closing fast .1.4.3 Economies of scale: Telecom is a huge fixed cost business; most of the costs go into installing and maintaining the network. The marginal cost of adding a new customer is very small. As a result, Providers with large subscriber bases enjoy a significant advantage over the smaller ones.

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Customer Service:

In this industry, although the customer contact with the firm is minimal, it is very critical and can define customer experience. Customer mostly comes into contact with the employees of the firm only during installation and service outages, the expectation of the customer is that the service be always available and the problems be immediately fixed.

Brand Name:

Brand Name plays an important role for the customer choosing the service. In this Industry Bell and Cable companies have been able to build brand recognition over time, VoIP entrant however have to spend significant amount of money in advertising to be able to counter these strong brand names.

Retail Presence:

Wireless phone industry has required retail presence from traditional telecoms mainly to display and sell wireless devices, this presence has helped them with customer as they were more accessible to the customers and provided a new medium of distribution for all services, Cable and VoIP firms however have to depend on electronic retailers.

Financial Strength/Resources:

With high fixed costs in this industry and frequent network up gradation and licensing costs, it is essential for the firms in this industry to have a strong balance sheet. The ability to raise money at cheaper rates compared to the competition provides a significant competitive advantage

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Convergence:

Convergence is the ability for customers to access any data seamlessly without restrictions and the networks and the devices to get to that data. In future the success of the telecom companies is dependent on how effectively they can provide converged services.

Partnerships:

Diversity of services this industry makes it difficult for a service provider to be good at everything, so the crucial thing for a firm in this industry is to be able to forge partnerships to be able to provide what customers need.

Data Speeds/Bandwidth: Explosive growth of internet has created content rich applications

which require enormous amount off bandwidth. The Service

provider who has the biggest amount of bandwidth with the last

mile connectivity will have competitive advantage over the rest of

the competition

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4 P’s in the U.S.

� Product � Price � Place � Promotion

4Ps: Product

� Voice & data products and services � Text Messaging � Wireless Internet � Family/share plans � Mobile-to-mobile

4Ps: Price

� Competitive pricing � Dependant upon local or national plans & number of

minutes � “Options” pricing sets companies apart

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4Ps: Place

� Internet sales & service � Full service stores for sales & service � Retail chains for activation

4Ps: Promotion

� TV, Print, Radio, Direct Mailings, and in-store placement � Sponsorships of Movies, TV, and events � Free services

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CONCLUSION INDIA

� India is second largest emerging economy of the world. � GDP growth 9% & Services Sector growth 10.8%. � Fastest growing Telecom Market in the World. � Teledensity is still less than 30% with rural teledensity just

around 10%. � Wireless technologies to play crucial role in providing

connectivity in rural, remote & far flung areas. � Mobile Number Portability to change Market Dynamics &

ensure improved standards of service. � With launch of VOIP telephony, Long Distance call charges

slated to fall further. � IPTV & DTH are providing digital experience to users. � High Growth in Mobile, Internet & Broadband foreseen till

2012.

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Conclusion US

� Biggest national market � Analog switching digital - 4 technologies � Focus on individual users � “Cutting the cord” � Trying to define niche market � Price competitiveness � Increasing the market share through price differentiation

strategy

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Reference

� Nicholas Economides The Telecommunications Act of 1996 and its Impact http://www.stern.nyu.edu/networks/telco96.html

� FCC Local Telephone Competition and Broadband Deployment http://www.fcc.gov/wcb/iatd/comp.html

� “Telephony.” Encyclopedia of Emerging Industries. Online Edition. Thomson Gale, 2007. Reproduced in Business and Company Resource Center. Farmington Hills, Mich.:Gale Group. 2008. http://galenet.galegroup.com.proxy.libraries.uc.edu/servlet/BCRC

� VoIP Magazine, 2005. Telecom Industry Revenue to Reach $1.2 Trillion in 2006

� The Industry Handbook – The Telecommunications Industry – Investopedia

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