STARTAGIC ANALYSIS OF RELIANCE COMMUNICATION WITH

COMPETITOR IN CHANDIGARH AND SURROUNDING OFFICE

OF

RELIANCE COMMUNICATION LTD.

A PROJECT REPORT / SUMMER TRAINING REPORT

Submitted By

SIKANDER SINGH

In partial fulfillment for the award of the degree

of

Bachelors of Business Administration

RIMT – INSTITUTE OF MANAGEMENT AND COMPUTER TECHNOLOGY

PUNJAB TECHNICAL UNIVERSITY: JALANDHAR

(2010-2013)

ACKNOWLEDGEMENT

There are a few things that come in the life of a person, may be for a short

span of time, but leaves on ever shining impression in to the mind. My

summer training is one of the events which will be ever green in my life. As I

had been placed in RELIANCE COMMUNICATION LIMITED, at Chandigarh. I

shared the real marketing skills and knowledge from their experienced,

enthusiastic and cordial executives, without whom I would have not been able

to achieve my aim.

First of all I would like to express my thanks to _________________ cluster head of

Reliance communication Limited, Chandigarh for permitting me to do the

training at his concern. I am also very grateful to Miss kiran(distributor lead)

for sharing valuable experience and suggestions regarding training and

preparation of report. I express my special thanks to my mentor miss shivani

gautam who has given me proper guidance in spite of having his busy

schedule. I would like to convey special thanks to my friends for providing me

help and co-operation needed. I also owe sincere gratitude to my family

members whose love, affection, co-operation and moral support have

provided me the strength to carry out this project

PREFACE

A project is a scientific and systematic study of real issues on a problem

with the application of management concept and skills. The study can deal

with small or big issues in any division of an organization. It can be case

study where a problem has been dealt with, through the process of

management. The essential equipment of project is that, it should contain

scientific collection of data, analysis and interpretation of data leading to

valid conclusion.

Summer Training is an essential part in BBA curriculum. It enables the

student to share the real experience in industry. My summer training has

placed in Reliance communication limited for the period of four weeks in

Chandigarh, Punjab.

The topic of my project was STRATAGIC ANALYSIS OF RELIANCE

COMMUNICATION with competitor in Punjab and surrounding office. This

project report tends to give a sharp picture of the telecom industry.

I hope, this study can be of some help to the telecom industry of his

Product and service.

Reliance communications

1. COMPANY INFORMATION

Reliance - India's largest business house

Reliance – Anil Dhirubhai Ambani Group, an offshoot of the Reliance Group

founded by Shri Dhirubhai H Ambani (1932-2002), ranks among India’s top three

private sector business houses in terms of net worth. The group has business

interests that range from telecommunications (Reliance Communications Limited)

to financial services (Reliance Capital Ltd) and the generation and distribution of

power (Reliance Energy Ltd).

Reliance – ADA Group’s flagship company, Reliance Communications, is India's

largest private sector information and Communications Company, with over 40

million subscribers. It has established a pan-India, high-capacity, integrated

(wireless and wire line), convergent (voice, data and video) digital network, to

offer services spanning the entire infocomm value chain.

Other major group companies — Reliance Capital and Reliance Energy — are

widely acknowledged as the market leaders in their respective areas of operation.

What Reliance is all about?

Reliance Energy Ltd.

Reliance Mutual Fund

Harmony

Reliance Communications

Reliance Life Insurance

Reliance Anil Dhirubhai Ambani Group

Reliance General Insurance

2. BUSINESS DESCRIPTION

RELIANCE COMMUNICATION

2.1 OVERVIEW

“A dream come true”

The Late Dhirubhai Ambani dreamt of a digital India — an India where the

common man would have access to affordable means of information and

communication. Dhirubhai, who single-handedly built India’s largest private sector

company virtually from scratch, had stated as early as 1999: “Make the tools of

information and communication available to people at an affordable cost. They

will overcome the handicaps of illiteracy and lack of mobility.”

It was with this belief in mind that Reliance Communications (formerly Reliance

Infocomm) started laying 60,000 route kilometers of a pan-India fibre optic

backbone. This backbone was commissioned on 28 December 2002, the auspicious

occasion of Dhirubhai’s 70th birthday, though sadly after his unexpected demise

on 6 July 2002.

Reliance Communications has a reliable, high-capacity, integrated (both wireless

and wire line) and convergent (voice, data and video) digital network. It is capable

of delivering a range of services spanning the entire infocomm (information and

communication) value chain, including infrastructure and services — for

enterprises as well as individuals, applications, and consulting. Today, Reliance

Communications is revolutionizing the way India communicates and networks,

truly bringing about a new way of life.

2.2.1 VISION:

“We will leverage our strengths to execute complex global-scale projects to

facilitate leading-edge information and communication services affordable to all

individual consumers and businesses in India.”

We will offer unparalleled value to create customer delight and enhance business

productivity. We will also generate value for our capabilities beyond Indian

borders and enable millions of India's knowledge workers to deliver their services

globally.”

2.2.2 India’s leading integrated telecom company

Reliance Communications is the flagship company of the Anil Dhirubhai Ambani

Group (ADAG) of companies. Listed on the National Stock Exchange and the

Bombay Stock Exchange, it is India’s leading integrated telecommunication

company with over 40 million customers.

Our business encompasses a complete range of telecom services covering mobile

and fixed line telephony. It includes broadband, national and international long

distance services and data services along with an exhaustive range of value-added

services and applications. Our constant endeavour is to achieve customer delight

by enhancing the productivity of the enterprises and individuals we serve.

Reliance Mobile (formerly Reliance India Mobile), launched on 28 December

2002, coinciding with the joyous occasion of the late Dhirubhai Ambani’s 70th

birthday, was among the initial initiatives of Reliance Communications. It marked

the auspicious beginning of Dhirubhai’s dream of ushering in a digital revolution

in India. Today, we can proudly claim that we were instrumental in harnessing the

true power of information and communication, by bestowing it in the hands of the

common man at affordable rates.

CHART: 1

Fig: 1

Reliance uses C.D.M.A. ( Code Division Multiple Access ) technology for its

wireless communication service which is used for Mobile as well as Fixed line

services. C.D.M.A. is known for better voice quality and higher data throughput

across the air interface at low operating cost .

2.1.1 RELIANCE MOBILE

POSTPAID

FEATURES OF POSTPAID

a)1 INDIA- Now call any phone, anywhere in India for just ONE RUPEE per

min.

b) My Plans- Presenting a range of Postpaid plans designed to fit every

lifestyle .So go ahead get on to Local gossip , chat for hours on STD , get close

to your group or jest get lost in new horizon.

c) Joy Plans- Reliance Mobile postpaid is a joy to use. Our postpaid plans help

you save on costs. Take your pick from a wide choice of plans with economical

tariff rates, according to your use and budget.

d) On-net Talk time Pack- Get 1,000 minutes of FREE talk time. That’s right.

Now, you can enjoy the first 1,000 minutes of calling to all Reliance mobiles and

fixed wireless phones and terminals (FWP/T) in your circle, absolutely free!

e) Get Started Kit- Do not be tied down by a particular handset or phone number.

Now set yourself free with the new ‘Get started kit’ from Reliance Mobile.

f) Bill Payments- Introducing convenient bill payments. Now pay your bills

directly from your credit card or bank account, and save precious time.

g) INMARSAT- Save up to 70 per cent on calls to satellite phones. Reliance

exclusively offers its subscribers significant savings — up to 70 per cent

depending on the type of terminal and the location — for voice calls made to any

Inmarsat number.

PREPAID

FEATURES OF PREPAID

a) Prepaid Tariffs- Choose the tariff plan that suits you needs.

b) E-Recharge- Now you can recharge your prepaid with any amount, from

Rs.10 to Rs.10,000. So don't let your budget stop you. Choose a recharge value

that suits you and stay mobile.

c) 1INDIA- Introducing 1 INDIA recharge options of 1 day, 1 week and 1

month validity.

d) Get Started Kit- Gone are the days when you were bound by a particular

handset and a certain phone number. You can now set yourself free with the new

Get Started Kit from Reliance Mobile.

e) Chat & Play - Now you can recharge your prepaid with any amount, from

Rs.10 to Rs.10,000. So don't let your budget stop you. Choose a recharge value

that suits you and stay mobile.

Reliance HELLO

Reliance landline:

FEATURES

A complimentary bouquet of features

a) Next-Gen caller ID: Reliance Landline displays the name and/or number of a

waiting caller while you are in the middle of a conversation. It allows you the

flexibility to choose between two calls or switch from one caller to another.

b) Mobile phone features: Now enjoy all the interactive benefits of a mobile phone.

Store and recall numbers from the phone book, check the history of missed / dialed

/ received calls. What’s more, you can also use the history menu to make fresh

calls.

c) Delayed hotline: You can program your Reliance Landline to automatically call

a predefined number by lifting the receiver and holding it for seven seconds.

d) Navigation keys: Using the navigation keys on Reliance Landline you can

activate phone features like delayed hotline, line locking, etc — now you need not

remember complicated feature codes and cumbersome procedures. You can also

set your preferred ring tone, ringer volume and LCD contrast.

e) Remote phone management: You can lock or unlock the STD/ ISD facility or

hotline settings on your Reliance Landline, remotely from anywhere, from any

tone / DTMF phone.

Plus, you get host of other interesting features like speaker phone, 3-way

conferencing, quick dialing, and many more.

Fixed Wireless Phone

Benefits:

a) No wires attached

Get on the wireless connectivity bandwagon. And straight away become

immune to cuts in the cable, rains etc. Carry the set along with you when

you move from one room to another or when you shift your home/office.

b) Wireless Internet (Reliance Net connect)

The FWP has an in-built modem for high speed internet connectivity. Surfat

speeds up to 115 kbps. What’s more, you do not need a separate ISP

connection for operating the set.

c) Mobile Phone's Features

Enjoy all the features of a mobile phone: SMS, In-built caller line

identification, voice mail, 99-number phone book, speaker phone, a choice

of many ringtones, etc.

d) City Mobility

You can use your FWP anywhere within your city and still receive and make

calls, at no extra cost.

FIXED WIRELESS TERMINAL(FWT)

Fixed terminal, limitless benefits

BENEFIT

e) Great Savings

Unbelievably low call rates. Substantial savings on ISD calls.

f) Zero Effective Rentals

Value of free calls almost equivalent to monthly plan charges.

g) Parallel Connection Facility

Two voice ports to connect two telephone instruments to be used as parallel

connections.

h) No Wires Attached

Wireless connectivity-immune to cable cuts, rains etc. Carry it along when you

shift your home/office.

i) Wireless Internet (Reliance Net connect)

In-built modem for high speed Internet connectivity at speeds of upto 115 kbps.

No separate ISP connection required.

j) State-of-the-art features

Three-way Call Conferencing, Speed Dialing, Hotline, Call Restrict/Call Lock,

Call Wait/Call Hold, Call Divert, Alarm and Caller Line Identification enabled.

Reliance broadband.

2.3 COMPETETORS

2.3.1 BSNL

The Grand Daddy of all Operators, The State owned B.S.N.L. was the first to

launch P.C.O. service across the country under the guidance of Sam Pitroda who

revolutionized the telecom industry in India. Besides its nationwide presence, it

enjoyed the first mover advantage and had no competition for almost a decade. The

advent of private operators made BSNL pull up its socks but still has an edge over

others in the market.

2.3.2 TATA INDICOM

Pay Telephony Business Unit (PTBU) is a strategic business unit of Tata

Teleservices Limited and has been the first private and branded player in the

payphone industry in the country. It provides its services under the brand name of

Tata. Starting with 5 circles in 2000 it has a nationwide presence in 20 circles and

over 200 towns across the country today. Tata also uses C.D.M.A. wireless

technology as used by Reliance but with a much smaller infrastructure which is

concentrated in only a few states like Maharashtra and Andhra Pradesh.

2.3.3 AIRTEL

Airtel, the Basic phone service of Bharti emerged as the first private competitor in

the basic phones market. Though using Landline phones (copper-wire

circuitry) the service turned out to be a welcome break from the inefficient

government owned operators.

3. STRATEGIC ANALYSIS OF THE COMPANY

3.1. ANSOFF’S MATRIX

The Ansoff product-market matrix helps to understand and assess business

development strategy. It has two dimensions, products and markets. Four different

growth strategies can be formulated and any business can choose which strategy to

employ, whether purely or as a mix. The strategies are

Market Penetration

Market Development

Product Development

Diversification

Reliance FWT PCOs can be categorized as product development. Product

development involves selling new products in existing markets.

MARKETPENETRATION

Penetrating the market for Product A, B, C, D wherever leadership is

there.

PRODUCTDEVELOPMENT

Introduction of newfacilities, customer friendlyservice, attractiveinstruments etc.

MARKETDEVELOPMENT

Introducing the Product B, C, D in newer markets(New territorial regionwithin the country)

DIVERSIFICATIONThe company may try providing consultancy for Telecom infrastructurecreation in developing countries in Middle East,South Asian regions.

Nepal, Bhutan, Bangladesh

Fixed Wire line Phones

TABLE: 1

POLITICALPermission of FDI (100%)New Telecom Policy 1999Recommendations Of TRAI for growth in WLL phonesPolicy changes for public-private partnershipsUnified Access Licensing Scheme

ECONOMICALIndia’s Per Capita holds higher tele-density potentialIncreasing demand for telephonystrong association between service sector growth and telecom development

SOCIALHigh purchasing power of people.new sources of employmentwelfare enhancing consequencesimproved access in the fields of education, healthcare, governance

TECHNOLOGICAL growth of telecommunications infrastructureshortage of telephone lines and high telephone chargesLast Mile ConnectivityTechnological innovation in the form of CDMA and 3G.

3.3 PEST ANALYSIS

TABLE: 2

The PEST analysis is a useful tool for understanding market growth or decline, and

as such the position, potential and direction for a business. A PEST analysis is a

business measurement tool. PEST is an acronym for Political, Economic, Social

and Technological factors, which are used to assess the market for a business or

organizational unit.

3.4 SWOT Analysis

CHART- 2

4. ANALYSIS OF COMPANY STRATEGY

4.1 PORTERS’s FIVE FORCE MODEL

CHART: 3

SUPPLIER POWER

High Competition

Concentration of Suppliers

THREAT OF SUBSTITUTES

High (Price Sensitive Market)

High Switching Costs

RIVALRY

Moderate High Switching CostsrowthLow Exit Barriers

High Switching Costs

Low Concentration Ratio

BARRIERS TO ENTRY

High Initial Costs

Government Regulations

BUYER POWER

High Bargaining Power

5 ANALYSIS OF COMPETITIVE POSITION

5.1 BCG MATRIX

BCG matrix is based on the product life cycle theory that is used to explain how

different products should be prioritized in a company’s portfolio. It has two

dimensions: market share and market growth. The two dimensions are used to

create a quadrant matrix in which all the products in a company’s product portfolio

are categorized into the four categories. This analysis helps avoid a strategy

mistake made frequently that is of measuring the performance of different products

on the basis of a single criteria e.g. generic growth rate. This framework assumes

that an increase in relative market share will result in an increase in generation of

cash.

5.1.1 STARS

These are high growth products which have a large market share in fast growing

industries. In case of reliance Communications its FWT services can be called stars

since they have a share of 21% of the market and are growing at the rate of 9%.

This service contributes 18% of total revenues and justifiably accounts for a large

percentage of total investment. Continuous investments should be undertaken by

the company to expand market share of WLL services because this could lead to

them becoming cash cows for the company in the future.

5.1.2 CASH COWS

These are the products which are leaders in markets which are slow growing but

the company has a large share of the market. As a result these products generate

large amounts of cash and profits but because of the slow rate of growth of the

market investments in these products should be kept low. These products are the

foundation for a company and provide the cash required to turn question marks

into market leaders. In context of Reliance its cellular services are growing at 4%

p.a., are the cash cow which form the foundation of the company.

5.1.3 DOGS

These are the products in which the company has a small share in a slow growing

market. As a result their contribution to overall revenues is limited and they can

turn into cash traps because of money tied up in a business which has limited

potential. Therefore the company should be beware of expensive turnaround plans

and should try to divest in these products. In case of reliance its fixed line services

can be called the dog for the company.

5.1.4 QUESTION MARKS

These are the products that are growing rapidly and thus consume large amounts of

cash, but because they have a low market share they don’t generate much cash. But

if proactive measures are not undertaken to increase the market share they

degenerate into dogs after years of cash consumption. Therefore the company

should aim at either investing heavily to increase market share or sell off to

generate whatever cash it can. In case of Reliance there are a number of products

which can be put into this category for example ISPs and LPCs and WLL PCOs.

A major limitation of this model is that it assumes market growth rate to be the

only factor of industry attractiveness and relative market share to be the only

indicator of competitive advantage. Therefore it ignores the strategy where a

business might use a “dog” to gain a competitive advantage in other business units.

STAR

Fixed Wireless phoneFixed Wireless Terminal Phone

QUESTION MARK

PCOsISP and Broadband ServicesGSM cellular service.

CASH COWS

Cellular ServicesReliance India CardRecharge Coupons

DOGS

Fixed Wire line Phones

TABLE: 3

6. STRATEGIES ADOPTED

6.1 SEGMENTATION

6.1.1 Geographic

Geographic segmentation divides markets into different geographical units. There

are four main cellular segments

Metro – the metropolitan areas of Mumbai, Delhi, Calcutta, and Chennai are under

this category of telecommunications circles and continue to lead.

Category A circles – mostly analogous to the states of India, comprising Andhra

Pradesh, Maharashtra, (category a leaders) Gujarat, Karnataka and Tamil Nadu.

Category B circles – mostly analogous to the states of India, comprising Uttar

Pradesh (east and west), Punjab (category B leaders), Rajasthan, Haryana, Kerala,

Madhya, Pradesh, and West Bengal.

Category C circles – mostly analogous to the states of India, comprising Bihar,

Orissa, North-East Assam, Jammu and Kashmir, Himachal Pradesh, Andaman and

Nicobar Islands

In context of Reliance PCOs, the company is specifically targeting non metros,

highways, commercial areas in metros, small townships and low income clusters in

urban areas for e.g. urban villages and industrial areas.

6.1.2 Demographic

In demographic segmentation, the buyers are divided into different groups on the

basis of variables such as their age, family size, family life-cycle, gender, income,

occupation, education, religion, race, generation, nationality and social class.

Consumer wants, preferences and usage rates are often associated with

demographic variables. The relevant categories that can be identified for Reliance

PCOs are senior citizens, unemployed youth, small shop owners, kirana stores and

existing PCOs owners

6.2 TARGETING

Reliance Communications current targeting approach is a mass-marketing method

that tries to address the needs of the entire market and widen its subscriber base. In

mass marketing, the seller engages in mass production, mass distribution, and mass

promotion of one product to all its buyers. Mass marketing creates the largest

potential market, which leads to the lowest costs, which in turn can lead to lower

prices and higher margins.

Reliance successfully implemented this strategy and while it did help Reliance in

expanding its customer base, its strength and spread remained limited to the

Category C regions (See table 2). The apparent popularity of Reliance

Communications in this category is due to its positioning in the market as a

“Common Man’s Phone”. Dhirubhai Ambani had dreamed of “Roti, Kapda,

Makaan aur Mobile” which clearly reflects the strategy, adopted by Reliance. The

low-tariff plans, low fared prepaid and postpaid offers have brought Reliance close

to the price conscious people.

They focus on few key aspects while promoting -

Next Generation technology

Widely available (Able to connect 90% of India’s population)

Low tariff rates to attract a wide customer base

Range of handsets offered with Reliance connections (Black and white

handsets, colour handsets with camera, video camera phone, camera watch

phone, PDA colour phone)

Special offers for making calls to the Gulf, USA and Canada

6.3 POSITIONING

Positioning can be defined as the act of designing the company’s offering and

image to occupy a distinctive place in the mind of the target market. The

positioning of the target has to be such that a majority of the target market segment

identifies with it.

7. 4 P’S OF MARKETING

7.1 THE FIRST “P” PRODUCT

The action plan of launching a new product includes a decision on the four Ps of

product, place, price, and promotion as well as the three Ps of services namely

people, processes and physical evidence. Also it is not a pure product or a pure

service that is being marketed. In terms of product Reliance is offering tangible

good with accompanying services, with the handsets being tangible goods and their

mainstay being the services. Now we can make this tangible on the basis of place,

people, price, and communications material.

Historically the thinking was that a good product will sell for itself. However there

are no bad products anymore in today’s highly competitive markets. Therefore it’s

inevitable now for a company to ignore on the various aspects of a product. We

have tried to analyze the product of Reliance Communications i.e. ‘WLL’ on the

basis of following parameters:

Quality

When we talk about the quality of any telecom service we basically focus on

following aspects:

Voice quality-

The Voice quality in CDMA based Networks is much superior as compared to

GSM Networks. Therefore Reliance WLL has a technological edge over its GSM

counterparts.

Data Transfer Rate-

The Data rates throughput available to a WLL user using a 3G handset, being

provided by Reliance is much higher than the data rates provided by the GSM

Operators using GPRS, a 2.5 G technology inferior to Reliance 3rd Gen

technology. So for a layman, it may mean that watching a Video Clipping or a

multimedia application on a CDMA Handset will be much more fun as compared

to the present day GPRS Services

Strong Optical Backbone-

Reliance, being an operator with Pan India presence, and possessing a strong

optical Backbone spread across the country, is expected to deploy and provide next

generation telecom services quicker and cheaper than any other private operator in

the country.

APPEARANCE

Appearance and design, however, still remains the user's first turn-on trigger.

Reliance WLL phone come as a refuge to the market as they are targeting the

various segments of the society. The low end model starts for as low as Rs. 2000

and the range goes up to Rs. 30000. The various phone models available are

quality phones being manufactured by the top firms like Nokia, Motorola,

Samsung and LG etc.

BRAND

Reliance Communications is the outcome of the late visionary Dhirubhai Ambani's

(1932-2002) dream to herald a digital revolution in India by bringing affordable

means of information and communication to the doorsteps of India's vast

population. Reliance Communications Ltd., an Anil Dhirubhai Ambani Enterprises

group company, is India's largest private information and communications services

provider, with a subscriber base of over 11 million. Reliance Communications has

established a pan-India, high-capacity, integrated (wireless and wire line),

convergent (voice, data and video) digital network, to offer services spanning the

entire Communications value chain.

SERVICE

Reliance Communications network is a pan India, high capacity, integrated

(wireless and wire line) and convergent (voice, data and video) digital network,

designed to offer services that span the entire Communications value chain -

infrastructure, services for enterprises and individuals, applications and consulting.

The network is designed to deliver services that will foster a new way of life for a

New India.

SUPPORT

The major focus for any company in the service sector is how satisfied their

customer is with the service being provided by the company. The service doesn’t

end with by selling the phone to the customer but also solving the concern,

difficulties, queries and complaints of the customer. Reliance Communications has

some innovative features like R-World apart from the usual customer support

services being provided by other telecom players. Reliance has a 24 by 7, 365 days

a year, customer service in ten regional languages to ensure consumers have a

smooth experience.

7.2 THE SECOND “P” PRICE

How much are the intended customers willing to pay? Here we decide on a pricing strategy - do

not let it just happen! Although competing on price is as old as mankind, the consumer is often

still sensitive for price discounts and special offers. Price has also an irrational side: something

that is expensive must be good. Permanently competing on price is for many companies not a

very sensible approach. Reliance India Mobile has revolutionized the Indian mobile

telephony market through unique pricing models. In fact, thanks to Reliance’s

innovative pricing, tariffs in India have fallen across the board by over 70 per cent,

making it the world's lowest-cost mobile market today. India was the world's

highest cost market in the nineties.

As of now, RIM has concentrated in terms of its pricing in the economy to medium

value segment. The products with high and good value have not been very

successful. But that was partly because at that time, reliance was more than just a

service provider, dealing in handsets and post paid plans and selling customized

solution. Now, with a maturing market, as people are moving to upgrades reliance

seriously needs to look into the high value segment. By high value we mean high

quality and high price segment. A high service in terms of not just the value adding

features but also the quality of your basic services. Airtel has projected itself as a

service provider with superior network coverage. Reliance has had issues in the

past with its billing and also its traffic congestion which has left many customers

complaining. And as they look to expand into new segments that are more life style

focused and brand conscious, negative word of mouth publicity is the last thing

they would want. Side by side, they also need to look for the latest offerings in the

market to lure and retain customers. The first movers advantage they had accrued

is now eroded as the competitors have come out with similar features and services

like internet surfing, cricket scores and multimedia content in both GSM as well as

CDMA segments. So reliance needs to heavily invest in developing new and

unique differentiating features and products to project itself as the better option to

the upwardly mobile youth. Like Airtel’s Blackberry initiative. Even though Airtel

is fighting reliance bitterly in terms of the least priced services to the consumers,

having a high end limited sales volume product in its range gives it a superior

image because of its aspiration power in the minds of the affluent youth.

In terms of the market pricing is concerned, RIM is faced with a unique situation.

Although it is aiming for market penetration, the usual low pricing strategy will not

be very successful as all the rivals are offering services at a very competitive rate

and drastic undercutting will only lead to erosion of profit margins. Also the

market is growing rapidly and further lowering of prices will not fuel the growth

further.

SCHEMES:

TARIFF PLAN FW

150

FW

290

FW

02

FW

03

FW

04

FW

600

RENTAL(RS./MONTH) 150 290 500 1000 1500 600

CLIP CHARGES 50 - - - - -

FREE CALL UNITS 50 150 450 1000 1750 2000

FREE

TALKTIME(RS/MONT

H)

60 180 495 1000 1575 600

RATE PER CALL UNIT

RS/CALL UNIT

1.20 1.2

0

1.10 1.00 0.90 0.30:TO RELIANCE

1.10:OTHERS

SECURITY FEE 2800 280

0

280

0

2800 2800 2800

TABLE: 4

Amount of sales (per month): FWP/I Phone

AREA FWP(SALE IN UNIT) I FONE(SALE IN UNIT)

MAYUR VIHAR 25 20

ADHCHINI 20 20

GREEN PARK 30 25

SAKET 25 25

PREET VIHAR 25 20

TABLE: 5

7.3 THE THIRD “P” PLACE

Available at the right place, at the right time, in the right quantities? Some of the

revolutions in business have come about by changing Place. We have focused on

different attributes related to reliance place strategy in successfully removing the

bottlenecks associated with the timely availability of its products through a

nationwide network of Web Worlds.

7.3.1 LOCATIONS

Reliance Web World is a countrywide network of retail outlets offering a host of

state-of-the art communication and information services along with food and

beverages in a modern ambience. It probably is also the world's largest network of

public access broadband centre. A total of 240 Web Worlds are operational in 111

cities and towns across India. The number of Web Worlds in this network will

further increase to cover nearly 700 towns and cities. All Web World outlets have

three components: Customer Convenience Centre, Broadband Centre and Gourmet

Café.

7.3.2 CHANNEL MEMBERS-

The following are the desirable features for sales people:

Competence First and foremost is the competence of the sales force.

Reliance has had billing problems in the past and competent

handling of all customer complaints will be of utmost

importance.

Courtesy RIM has exclusive retail outlets, which can be monitored, but

newer expansion plans will mean selling through other retailers

for prepaid cards.

Credibility This is a major issue as the previous policies were not very

transparent and this has generated a negative perception for

Reliance.

Responsibility Problems of area distribution between different franchises

Communication Continuous communication is needed for promoting newer

policies and promotion schemes. Higher flexibility given to

franchisees in offering customized plans.

7.3.3 DISTRIBUTION CHANNEL

Reliance’s FWT PCOs are distributed through a network local business associates

(LBA). Every district is divided into a number of zones each of which is headed by

a zone PCOs lead. In every zone there is a point of sales, the LBA who acts as the

interface between the company and the local PCOs operator. The LBA gets in

contact with existing and potential PCO owners and after they decide to take a

PCO connection from Reliance, he helps to arrange for the entire package which

consists of the phone instrument, FWT, billing machine, telephone booth and patch

panel antenna.

7.3.5 MARKET COVERAGE

Reliance is the second largest player in FWT market which is growing at fast rate

of 5.5%. The Lead player in the market is Tata Teleservices. But Reliance has

shown major improvement in the market coverage and has grown its share from

34.15% in April’05 to 37.12% in Oct.’05.

7.4 THE FOURTH “P” PROMOTION

(How) are the chosen target groups informed or educated about the organization

and its products? This includes all the weapons in the marketing armory -

advertising, selling, sales promotions, Public Relations, etc. While the other three

P's have lost much of there meaning in today's markets, Promotion has become the

most important P to focus on.

Since it’s a highly competitive sector therefore Reliance had to work really hard on

its promotional schemes in order to grab the market share.

But the most important tool that Reliance should really be considering is the sales

promotion as a strategy to reach out to a mass audience and grab attention. And

also to arouse the interest of the target segment in the product this strategy will be

very useful. Just like what Nokia did sometime back for the N-gage and what the

two wheeler companies have been successfully doing for a long time, RIM should

come up with road shows as soon as they come out with their newer models to

generate curiosity in the minds of the people. Online games as suggested should be

an important feature of the mobiles and online one to one competitions can be

organized for promotional schemes. This is nothing new for Reliance

Communications as they had done this for the promotion of their Web world

broadband services also. Partnering with KBC like game shows will also be a big

draw as Airtel have successfully demonstrated. Another charm for the youth is the

concerts, technology fares etc and organizing these as well as partnering as

sponsors with such events in colleges and expos can also are used to draw

attention.

8. CURRENT MARKET SCENARIO FOR WLL PHONES IN

INDIA

8.1 CDMA Mobile Segment

CDMA subscriber’s base grew 5.7% mom to 14.49mn with Tata contributing a

chunk of additions in subscriber base. Tata witnessed a whopping 20.6% mom

growth in subscriber base, touching the 2.5mn mark. Reliance witnessed a sluggish

3.2% growth in the month of October. However, it maintained its market

leadership with a total subscriber base of 11.78mn.

CDMA subscriber data

Group

Compan

ySubscribers as of

September'05

Additions

In Oct

Subscribers as of

October'05 (%)Growth

Reliance 11,414,478 366,888 11,781,366 3.2

Tata 2,055,865 423,265 2,479,130 20.6

HFCL60,292 542 60,834 0.9

Shyam 28,182 43 28,225 0.2

MTNL154,301 (11,296) 143,005 (7.3)

Total13,713,118 779,442 14,492,560 5.7

Source: AUTSP Table: 6

Market share of CDMA operators              CDMA share of net additions

Graph: 1 Graph: 2

8.2 Fixed Wireless Terminals (FWT)

FWT continues to be one of the fastest growing segments with 5.5% mom growth.

Tata maintained it leadership position in FWT segment with 61% market share

amongst private players. In net additions, too, Tata led with 55% share. However,

Dot’s latest ruling removing FWT service from the ambit of basic service and

instead terming it a ‘limited mobile service’ liable to ADC levy may be a serious

blow to the growth of this segment.

Group

Compan

ySubscribers as of

September'05

Additions

In Oct

Subscribers as of

October'05 (%)Growth

Tata 3,219,643 158,437 3,378,080 4.9

Reliance1,921,692 128,972 2,050,664 6.7

Bharti23,999 (265) 23,734 (1.1)

HFCL33,043 1,753 34,796 5.3

Shyam26,915 232 27,147 0.9

Total5,225,292 289,129 5,514,421 5.5

Fig: 12

We compared the above figures with the figures of March’05 and realized that

reliance market share has gone up from 34.15% to 37.2% in six months which

shows that there is both potential in the market as well as in the company itself to

increase its market share further.

Fig 13

Initiatives:

Introduction of Low cost telephony by launching Free Incoming service which

took the telecom market by storm

Achievements:

Brought the mobile phone to the common man by introducing Monsoon Hungama

and Happy Diwali offers in 2003

Milestones:

Became the second largest Mobile service in the country with more than 1 crore

subscribers within 2 years of launch.

Channel

Initiatives:

Introduced the Dhirubhai Ambani Entrepreneur scheme to involve the middle class

to partner Reliance and profit from it.

Achievements:

Built enduring relationships with people cashing in on the name of Reliance.

Milestones:

Elevated dealers to the position of business associates giving them more

importance and responsibilities which formed the backbone of the channel.

Costs

Initiatives:

Low cost telephony ringing the mobile in the ears of the common man.

Achievements:

Instrumental in bringing down call rates across the entire mobile phone sector.

Milestones:

Still riding the crest of the tide with large volumes of subscribers and subsequent

high returns

Service

Initiative:

Spread a network of Reliance Web worlds and Web world Express providing One-

Stop shops for all customer needs.

Achievements:

A dedicated sales and service staff took care of the customers and led to efficient

management despite swelling subscriber figures

Milestones:

Web world home to a variety of Virtual courses, Gaming Zones and Video

conferencing facilities .First one of its kind in the country

Systems

Initiative:

Introduction of C.D.M.A.1X. Technology into the Indian market on a large scale

which resulted in high quality wireless service at low costs. Add to that a 60000

km fiber optic backbone network.

Achievements:

Combining of Data and Voice service done on an extensive scale with C.D.M.A.

1X technology. Instrumental in bringing Mobile to the remotest corners of the

country (Regulations not withstanding)

Milestones:

Reliance possesses 74 Mobile Switching Centres (MSC s) and about 7200 Base

Transceiver Subsystems (BTS sites), providing a 98.6% Quality of Service (QOS)

rating for areas under coverage.

Brand

Initiative:

India’s most reliable brand added another dimension by entering the telecom

market. Its name preceded Reliance but the brand name Communications came

into prominence.

Achievements:

Kar Lo Duniya Mutthi Mein, having the world in your palms, caught the

imagination of people and launched Reliance India Mobile.

Milestones:

Ek Soch thi, Ek Sapna Thaa, Dhirubhai’s dream of a call at the cost of a postcard

was realized and entire India called out Mujhme Hai Wo Baat.

9. CUSTOMER SATISFACTION

We were more concerned about the factors that influence the consumer before

choosing any new connection or switching from the present connection. We rated

the different attributes on the scale of (1-5). We found the following results.

Attribute importance (1-5)

3.403.503.603.703.803.904.004.104.204.304.404.50

NetworkCoverage

Easyavailability

voice quality customercare

Billingsystem

The Network Coverage was the factor that concerned the people to the greatest

extent. However the factors like the Billing System and the Voice Quality were

also important. These factors were the desired attributes by any user.

Calculated Ratings on 5 Point Scale

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

Reliance

Airtel

BPL

Idea

Hutch

BSNL

Tata indicom

Reliance 3.75 3.56 2.50 3.88 2.81

Airtel 3.64 3.46 2.46 3.93 3.08

BPL 4.00 3.00 3.00 4.00 3.00

Idea 3.20 3.60 3.80 3.80 4.00

Hutch 3.80 3.80 3.40 3.00 3.75

BSNL 4.16 3.89 3.05 2.89 3.53

Tata indicom 4.00 3.00 4.00 3.00 2.00

Network Coverag

e

Easy availabili

ty

voice quality

customer care

Billing system

Graph: 6

This showed that Voice Quality and Billing System were the two areas where

Reliance had performed pretty badly against its competitors. We came to know that

the Billing System by Reliance is said to have many discrepancies. Here Reliance

really needs to work upon.

The Road Ahead

P.B.O. The new age P.C.O. From Reliance

Reliance Communications Ltd is looking at the successful public call office (PCO)

model for delivery of e-governance initiatives to the rural areas.

In the nextgen PCO, Reliance will use broad band to deliver the services, and will

be aptly named Public Broadband Office (PBO). Prakash Bajpai, president,

Reliance Communications, said the G2C (government to consumer) initiative on e-

governance will popularize the use of broad band. However, he neither had the

time-frame for Reliance’s projected PBO nor the investments needed.

“The PBO will need applications like e-mail, transactions, filing of returns, sales

tax or excise duty filing or any other work requiring government interaction.

Additionally, we will have to persuade government for spectrum availability and

dedicated carriers for data will be needed. Investments will be needed for the

creation of base stations, too,” Bajpai said. Meanwhile, pushing its broad band

service offering, Reliance Communications will add another eight products to its

existing 12. The new products, to be launched in another two months time, will

include collaborative services and consumer Internet.

The bouquet of collaborative products will include audio video and web

conferencing services while consumer offerings would include health, games

recreation

In an effort to improve its customer care services, the telecom services provider is

set to launch Web World Express (WWE). These franchised outlets will initially

attend to customer care issues and then expand to include broad band services.

Reliance Netway:Broadband TV at your home

As far as the broadcast sector is concerned however, it is Reliance's broadband

plans, Ethernet broadband 'Netway' for the home user in particular, that is the focus

of attention.

Netway is still nearly a year away from commercial launch, clarifies Khanna,

though a "test run" of the service that "has no parallel anywhere in the world

except in Italy on a very small scale" is already on at the Reliance centre in

Jamnagar, Gujarat. 3,000 households of

Reliance employees at the Jamnagar oil refinery have been wired up for this

purpose, says Khanna.

Relia

nce's

set-

top-

box

In another two months, the testing process will move up a gear when 5,000 homes

of Reliance Communications employees (there are 15,000 of them working in

DAKC alone) get wired up.

Suffice to say that what Reliance is committing to give its home user customers is

100 mbps bandwidth routed through a prototype set top box that will triple up as a

TV remote, a phone, a keyboard and even a karaoke microphone.

With this kind of bandwidth capacity, the question is of course what is the sort of

content that will be made available for home users. According to the literature

provided, aside from the obvious high speed Internet which also offers Voice over

IP telephony, there will also be movies on demand, music on demand and digital

TV. A vast library of movies with multiple language subtitles as well as an

extensive music listing is being compiled at the moment. Netway is also promising

interactive TV with over 160 channels

Reliance Data Center

Reliance Data Centers are truly world class Level 3 IDC facilities with a total area

of 205000 sq. ft. located at the sprawling Reliance Communications Headquarter

campus, Navi Mumbai and at Bangalore. Reliance's data center project further

includes setting up of world-class data centers in 6 major cities in India covering

approximately 5,00,000 sq.ft. area in the next 2 years

The Data Centers has been internationally benchmarked with respect to physical

and network security, infrastructure, facilities, network connectivity and its

operations, which achieves and surpasses the Level 3 world standards. The Data

Centers are connected to Reliance's country wide optic fiber based IP network with

terabytes of capacity having points of presence at more than 700 cities. The data

centre is further connected to 52 countries including US, UK, Mid-east and Asia-

Pac through Flag Telecom backbone (Reliance Communications’s group

company), other undersea cable systems and are having private peering

relationship with the largest Tier 1 ISPs and public peering at more than 15

Internet Exchange points across the globe. There also exists peering relationship

with domestic ISPs on STM-1 bandwidth levels.

Recommendations

Reliance has for long been perceived as the common man’s phone. It

needs to come out of the mid-segment trap by catering to the high end

subscribers who bring in larger arpu

It is highly important to retain customers as sooner or later the market

will saturate and the low call tariffs will prompt subscribers to switch

operators

With uniform number across operators being a possibility in the near

future, existing subscribers will be inclined to move to an operator

offering better service, it is highly recommended that Reliance pulls up

its socks and improves its service quality which is lacking in certain areas

like network coverage and billing

Reliance has the most extensive private network in the country and needs

to consolidate its position by improving its standards and living up to its

famous brand name

BIBLIOGRAPHY

BOOKS

Marketing Management - Phillip Kotler

Marketing Research - Tull & Hawkins

MAGAZINE

Business Today

Advertising & Management

NEWSPAPERS

Economic Times

Hindustan Times

WEBSITE

www.COAI .in

www.AUSPI .in

The relevant information from the internal source of the organization

Questionnaire

1. Whether following things are available?

Monsoon offer 48%

Kit 90%

V-top 40%

E-Recharge 90%

The survey revealed that 48% retailers have monsoon Offer, 90% have

kit, 40% have V-top and 90% have E-recharge.

2. What is the frequency of DSE visit?

Once a Week 20%

Twice a Week 50%

Thrice a Week 30%

None of above 0 %

The survey revealed that 20% retailers have said that DSE visits once a

Week, 50% retailers have said that DSE visits twice a Week, 30%

retailers have said that DSE visits thrice a Week.

3. What availability of stock you keep for sale in

Your shop?

Daily 9%

weekly 72%

In 15 days 18%

Monthly 1%

The survey revealed that 9% retailers keep daily stock, 72% retailers keep

Weekly stock , 18% retailers keep stock of 15 days and 1% retailers keep

monthly stock.

4. What nature of problem you face with RCOMM?

Service level 31%

Claim level 95%

Product availability 18%

Product awareness 25%

The survey revealed that 31%, 95%, 18%, 25% retailers have problem with

service level claim level, product availability and product awareness

respectively.

5. How much time is taken by the distributor to reimburse your claims?

20 days 11%

30 days 25%

45 days 25%

60 days 39%

The survey revealed that 11%, 25%, 25%, 39% of the retailers are

reimbursed by distributor at claim level respectively.

6. Who are the major competitors of RCOMM?

Airtel 55%

Aircel 15%

BSNL 15%

Tata Indicom 30%

Smart 8%

The survey revealed that Airtel and Tata indicom are the major

competitors of RCOMM.

0%

10%

20%

30%

40%

50%

60%

AirTel BSNL Smart

Series1

7. If you have any problem then whom you will prefer to talk?

Distributor 10%

TSM 23%

DSE 67%

The Survey revealed that 10%, 23% and 67% retailers prefer to talk to

Distributor, TSM and DSE.

8. How do you know about new scheme?

Companies SMS Poster DSE

Reliance

Airtel

AirCel

smart

Tata Indicom

9. How much time do you take to activate a sim?

(i) 10-15 min. 44%

(ii) 15-30 min. 38%

(iii) 30-60 min. 6%

(iv) Above 60 min. 12%

The survey revealed that 44% retailers take 10-15 min., 38% take 15-30

min., 6% take 30-60 min. and 12% take more than 60 min. in activation of a

SIM.

10. From which company distributors you are more satisfied?

(i) Airtel 34%

(ii) Reliance 28%

(iii) BSNL 17%

(iv) AirCel 16%

(v) TATA 4%

(vi) None 1%