Professional Documents
Culture Documents
-----------------Ms. GARGI
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D EH RA D U N
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CERTIFICATE
I have the pleasure in certifying that Mr. /Ms. ROHIT PANT is a bonafide student of MBA 3RD Semester of the Masters Degree in Business Administration of Institute of Management Studies, Dehradun under Class ID No.MB06029. He has completed his/her Summer Training Project work entitled MARKET SHARE OF BHARTI AIRTEL LTD. under my guidance. I certify that this is his original effort and has not been copied from any other source. This project has also not been submitted in any other university for the purpose of award of any degree. This project fulfills the requirement of the curriculum prescribed by Uttarakhand Technical University, Dehradun for the said course.
TABLE OF CONTENTS
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Market Share of Mobile... 26 prepaid v/s Postpaid GSM. GSM Share Market Development Since 2001 ARPU Expansion of GSM Operators CDMA.. Market Share Of CDMA/WLL Internet. ITES.. Classification SWOT Analysis Of Indian ites Sector Threats Faced By Industry Research Methodology. 65
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Elements Of Research data collection Sources Of data Collection Analysis & Findings.
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Bibliography.. 82
ACKNOWLEDGEMENT
I take this opportunity to express my profound and sincere gratitude to Uttarakhand Technical University for providing me with the opportunity to explore the corridors of the Corporate World and gather invaluable information & practical experience via such summer training project in Marketing. I take the privilege of offering deep sense of gratitude and indebtedness to Ms. Chitra for providing me help to prepare this project report and his valuable inspiration to carry out this project. I express my sincere gratitude to my company guide Mr.Gitesh Taneja (Zonal manager Marketing) for his guidance during the course of my training. His sound advice has been well taken by me and it is largely due to his patience that I was able to accomplish my target. He has been most accommodating and supportive and has made my experience a pleasant one. I would like to thank all my colleagues and faculty members at I.M.S. for their valuable suggestions and constant encouragement.
EXECUTIVE SUMMARY
The project undertaken by me at Airtel as part of Summer Training Program provided me an opportunity to understand the Mobile Services Segment and to gain an insight into the various strategies employed to cater this segment of the industry. The Mobile Services segment stands at the cusp of a new opportunity. This sector is booming in India as the companies today are starting to operate globally thereby have an increasing IT and Telecom needs. It provides a lot of opportunity for the telecom companies to delve into this sector and find out the desired potential market. Working from the office in Dehradun from 20th June 2007 to 30th august 2007, I have learnt about the various aspects of Telecom sector in India and abroad. This project was a practical experience as I learned who the different players in the market are and what is their market share vis--vis airtel. As a part of the project the following activities were done during the ten week summer training project at Airtel Mobile Services: Worked with marketing department of Airtel at Dehradun for developing a Marketing Intelligence Repository, posted on the intranet which has been introduced by the company to facilitate sharing of information among the marketing team with ease. Prepared Questionnaire so as to find out the visibility index of airtel at different circle. Prepared a database of Airtel so that company could analyse data and take corrective measures so as to enhance the visibility share of airtel in the market.
Analyzed Small and Medium retailers segment in Dehradun zone according to a research conducted by us, and prepared a presentation on the Small, Medium retailers and distributors individually.
To map the potential for growth of telecom services in the Dehradun Segment the following activities were done o Collected data from secondary sources like magazines, Newspaper Articles etc. depicting figures for the past, Trends that the market has shown and also the expected market and forecast results. o Collected data from previous researches conducted by Airtel and other agencies like IMRB, Frost and Sullivan, Ernest and Young etc. o Collected primary data from survey conducted by us in Dehradun circle which included Haridwar, Saharanpur, Roorkee, Rishikesh, Kotdwar, Deobandh, Chutmalpur.
The survey was conducted in Dehradun Zone with main emphasis on learning about the market visibility share of airtel and with respect to other competitors and with a wider motive to educate the retailer about the various aspect of airtel and how can they increase their sales and income by following some simple Guidelines. Moreover the added advantage was that the make a buffer between distributor and company and between retailer and company. The survey not only helped in gaining an insight into the market share of airtel but also helped in giving personal attention to retailers problem. The survey was done in Dehradun Zone which included areas like Haridwar, Saharanpur, Rishikesh, Kotdwar, Deobandh, Chutmalpur, and Dehradun off course. The survey was also conducted in outer areas of different places so as to gain full knowledge of the market. The survey was done on exactly 3000 retailers to gain the first hand report on market. The project has been a great experience for me as an individual and provided me an opportunity to work in team on a practical project; thereby it acted as a platform for me to gather first hand experience for exploring the corridors of the corporate world.
Few Key Milestones Date of Incorporation First private operator to offer fixed line telephony Became a public limited company in India First Telecom Company to have an all India mobile footprint (Presence in all 23 telecom circles in India)
July 07, 1995 June 04, 1998 February 18, 2002 March 30, 2005
Telecom giant Bharti Airtel is the flagship company of Bharti Enterprises. The Bharti Group has a diverse business portfolio and has created global brands in the telecommunication sector. Bharti has recently forayed into retail business as Bharti Retail Pvt. Ltd. under a MoU with Wal-Mart for the cash & carry business. It has successfully launched an international venture with EL Rothschild Group to export fresh agri products exclusively to markets in Europe and USA and has launched Bharti AXA Life Insurance Company Ltd under a joint venture with AXA, world leader in financial protection and wealth management. Airtel comes to you from Bharti Airtel Limited, Indias largest integrated and the first private telecom services provider with a footprint in all the 23 telecom circles. Bharti Airtel since its inception has been at the forefront of technology and has steered the course of the telecom sector in the country with its world class products and services. The businesses at Bharti Airtel have been structured into three individual strategic business units (SBUs) - mobile services, broadband & telephone services (B&T) & enterprise services. The mobile business provides mobile & fixed wireless services using GSM technology across 23 telecom circles while the B&T business offers broadband & telephone services in 94 cities. The Enterprise services provide end-to-end telecom solutions to corporate customers and national & international long distance services to carriers. All these services are provided under the Airtel brand. Bharti Enterprises is one of Indias leading business groups with interests in telecom, agri business, insurance and retail. Bharti has been a pioneering force in the telecom sector with many firsts and innovations to its credit. Bharti Airtel Limited, a group company, is one of Indias leading private sector providers of telecommunications services spanning mobile, fixed line, broadband and enterprise services. Bharti Airtel was recently ranked amongst the top 10 best performing companies in the world in the Business Week IT 100 list and emerged as The Second most trusted Brand' in the most trusted Brand 2007 survey conducted by The Economic Times (ET) Brand Equity. Bharti Airtel is structured into three strategic business units - Mobile services, Broadband & Telephone (B&T) services and Enterprise services. The mobile business provides mobile & fixed wireless services using GSM technology across 23 telecom circles. The B&T business provides broadband & telephone services in 94 cities. The Enterprise services provide end-to-end telecom solutions to corporate customers and
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national & international long distance services to carriers. All these services are provided under the Airtel brand. Airtel's high-speed optic fiber network currently spans over 40,000 kms covering all the major cities in the country. The company has two international landing stations in Chennai that connects two submarine cable systems - i2i to Singapore and SEA-ME-WE-4 to Europe MOBILE SERVICES: Bharti Airtel offers GSM mobile services in all the 23-telecom circles of India and is the largest mobile service provider in the country, based on the number of customers. ENTERPRISE SERVICES (corporate): The group focuses on delivering telecommunications services as an integrated offering including mobile, broadband & telephone, national and international long distance and data connectivity services to corporate, small and medium scale enterprises.
BROADBAND & TELEPHONE SERVICES: The group offers high speed broadband internet with a best in class network. With Landline services in 94 cities we help you stay in touch with your friends & family and the world. ENTERPRISE SERVISES(Carrier services): The Company compliments its mobile and broadband & telephone services with national and international long distance services. It has over 35,016 route kilometers of optic fiber on its national long distance network. For international connectivity to east, it has a submarine cable landing station at. For international connectivity to the west, the Company is a member of the South East Asia-Middle East-Western Europe 4 (SEAME-WE-4) consortiums along with 15 other global telecom operators.
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Our Vision
By 2010 Airtel will be the most admired brand in India: Loved by more customers Targeted by top talent Benchmarked by more business.
MISSION
We will meet global standards for telecom services that delight customer through Customer service focus Empowered employees Innovative services Cost efficiency
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A) Basic Fixed Line: Until 1996 India was a pure fixed line market
TELECOM STATISTICS
DEC 05 92.76 mn 8.80% 45.15 mn Dec 06 94.92 mn 10.80% 55.15 mn June07 225.01 mn. 20.52% 60.23 mn
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The players
The fixed line segment was a monopoly sector controlled by govt. until 1996, but after sector was opened for the private players, there are now 6 private players and 2 states owned.
BSNL MTNL Bharti (Touch tel) Tata telecom Shyam Telecom HFCL Reliance Hutch Idea
SOURCE:COAI
BSNL & MTNL are 2 state owned companies & rests 6 BHARTI AIRTEL, TATATELE SERVICES, SHYAM TELECOM, HFCL, RELIANCE & HUTCH are all private players. Where BSNL holds the major share of the market. Then comes Private Sectors Company BHARTI AIRTEL which holds a major part of market. Both these companies have a big subscriber base. HUTCH, RELIANCE & MTNL comes one after another.
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BSNL with a subscriber base of 34,862,000 is on the first position & then comes another govt. holding MTNL which has a subscriber base of 4,475,000 .Then Bharti airtel is the private sectors biggest telecommunication company with a subscriber base of 609,047 subscribers.
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BSNL the public sector giant totally funded by government have majority market share of 86 % in fixed line telephony. It operates in all over India except Delhi and Mumbai where MTNL operates. With the entry of more and more private players in the fixed line telephony, the competition is becoming fierce; as a result operators are now focusing upon offering various services to the consumers along with their fixed line connections.
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SERVICE AREAS All over India Delhi ad Mumbai Gujarat, Haryana, Punjab, Delhi, WB, UP (E) Delhi, M.P. Rajasthan Delhi, Gujarat, Maharashtra, Tamil Nadu, AP Only in Punjab
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Fixed VS Mobile
The difference between the numbers of fixed line and mobile subscribers is fast narrowing. In Delhi, Punjab and Haryana mobile users have crossed over fixed line users already. This is because of Low tariff structures offered by mobile operators which are attracting consumers to switch over to mobile phone subscriptions. This trend has a two way side effect on fixed line telephony fixed line operators are finding it hard to reduce consumer churn Their ARPU has taken a big leap downwards Reduced mobile tariffs could be explained as the most prominent reason for increased mobile subscriber base. Various facilities like sms, mms, and games etc acts as a major variant to attract customers.
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Present Trends
Intense consumer shift towards mobile services Low call tariffs SMS over fixed line is available Due to the major shift of customers from fixed to mobile services there is a fluctuating ARPU Low subscriber additions Private operators like Bharti is increasing its market share constantly.
Future challenges
To provide more data services on fixed line To reduce customers turn towards mobile service. To provide more facilities to the customers. To add more number of customers. To add more number of services to give competition to the Cellure mobile services.
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From 1996 3G licenses were issued for GSM mobiles. After then in 1990-2000 SMS facility was started .In the year 2002-03 the GPRS & MMS facilities were started which gave a new competition in the telecom sector. Then there was a great change take place in the form of CDMA mobiles which came into existence in the year 2003.In the year 2004 onwards
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Road to 3G in India
GPRS is widely offered by major operators. BPL was the first operator to Launch GPRS in India, followed by Airtel, Hutch and Idea. Hutch, Airtel and Idea, are providing EDGE Networks
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The GSM camp argues that a number of firms make equipment and handsets for the 1800 band. More importantly, 3G equipment for GSM is available only for the 1900 band and nowhere else.
When we talk about the market share of mobile companies then BHARTI AIRTEL is the biggest company with a market share of 20.62% in 2005 July but now the percentage has been raise up to 31%.then comes government owned BSNL 18.30%in 2005 July & in July 2007 this percentage is also raised to 20. %. After then VODAPHONE HUTCH comes with a increased percentage of ..% in July 2007.
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GSM operators
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Bharti Tele-Ventures led the way, adding 1.12mn customers in the quarter, contributing close to 30% to the overall additions for the quarter. Bharti came up with new schemes and also ventured into 3 new circles during the quarter.
City/Circle
Operators
Jan'2006
Feb'2006
Mar'2006
Metros
Delhi Bharti Tele-Ventures Hutchison Essar MTNL IDEA 1895680 1742136 742647 832183 2014989 1777191 790476 848852 2074987 1879226 936146 866966
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Mumbai
Chennai
Kolkata
All Metros
Total
A' Circle
Maharashtra BPL Cellular IDEA Bharti Tele-Ventures BSNL 683651 1631574 1211226 1056053 708799 1693966 1235589 1056053 733754 1782041 1313923 1134249
Gujarat
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A.P.
Karnataka
T.N.
A' Circle
Total
21876761
22977143
24332549
B' Circle
Kerala Idea Mobile Comm. BPL Cellular Bharti Cellular BSNL Spice Comm. Bharti Tele-Ventures BSNL Hutchison Essar Haryana Idea Mobile Comm. Aircel Digilink Bharti Cellular BSNL Ideal Mobile Comm. Bharti Tele Ventures BSNL Hutchison Essar Aircel Digilink BSNL Bharti Tele-Ventures 768101 431102 529444 1425438 1351215 1542103 383020 605837 273456 344998 384948 482490 813111 519132 892797 501369 1209445 1581512 543207 783096 443120 571328 1518117 1421560 1637866 371299 634342 291179 372456 396666 481805 858609 525770 914086 561391 1289843 1588530 553730 796354 463700 610772 1604180 1501341 1678683 371756 658923 311602 373801 423387 485783 920697 549369 943776 613413 1392498 1609488 639234
Punjab
U.P.(W)
U.P.(E)
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Escorts Telecomm. Rajasthan Aircel Digilink Bharti Hexacoms BSNL Escorts Telecomm. IDEA Reliance Telecom Bharti Tele-Ventures BSNL Reliance Telecom BSNL Bharti Tele-Ventures Hutchison Telecom Dishnet Wireless Total 527136 918233 953830
148 559914 1020315 1018085 121 681128 513292 436231 389821 239388 655055 299662 462205 14390 21504548
246 601292 1023163 1099415 162 728520 529146 503297 471839 260760 716634 309234 505245 27709 22725419
M.P.
649095 500159 403769 387966 227410 583060 291642 417158 7522 20449705
B' Circle
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C' Circle
H.P. Bharti Tele-Ventures Reliance Telecom BSNL Escorts Telecomm. Bihar Reliance Telecom BSNL Bharti Tele-Ventures Orissa Reliance Telecom BSNL Bharti Tele-Ventures Dishnet Wireless Assam Reliance Telecom BSNL Bharti Tele-Ventures Dishnet Wireless N.E. Reliance Telecom Bharti Tele-Ventures BSNL Dishnet Wireless Jammu & Kashmir BSNL Bharti Tele-Ventures DIshnet Wireless 502281 782889 665241 179906 476399 364527 19469 185053 308346 129156 34992 53818 22999 176853 36427 426384 240893 2445 5213229 332955 62030 210166 343460 62578 212796 21 503642 869675 743333 189821 524522 402053 21700 192056 336824 144466 47667 69091 28360 191074 49364 461294 251092 8337 5653226 357382 63027 220134 39 510396 927557 907913 203759 560644 457734 35537 205672 377038 180405 68808 81717 41553 227365 57388 504483 261214 25714 6275479
C' Circle
Total
All India
Total
62019144
65188550
69193321
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The subscriber growth saw a phenomenal increase from 2002 onwards. This was mainly due to lowered call tariffs and full scale implementation of SMS services all over India. December 2002, where India touched the 10 million mark could be defined as a milestone for Indian wireless industry. Subscriber growth continued from 2002-03. Two main elements for this phenomenal growth are 1. Lowered call tariffs 2. Free incoming calls Consumers who were once reluctant to subscribe to mobile subscriptions founded feasible and convenient to avail as now there was hardly any difference between the monthly bills compared to fixed line, and mobility was definitely a crucial element. The above phenomenon in India is taking shape because of the presence of huge middle class population. On an estimate there are some 300 to 350 million people belonging to this group in India. Unlike a car or a television set (where one is enough in the family) with the lowered call tariffs it became possible even for family members to own a mobile phone each.
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India is a vast country with over 3000 Kms of distance from north to south and similarly from east to west. Covering this huge scope of land became a challenging task for the operators, as a result many failed and vanished from the business because the industry demanded huge capital investments and some of them were of course unable to do so. The above scenario triggered two situations: Smaller operators sold their licenses to big players The bigger players seeing an opportunity to expand, acquired smaller operators
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ARPU
The Average Revenue per User (ARPU) of GSM operators is steadily declining. This trend of declining ARPUs and increasing revenues is purely because of the rising subscriber base. With more customers going mobile, they are spending less on talk time. However, the subscriber base expanded, leading to revenue increase for the operators. Declining due to a sharp fall in tariffs. Average Revenues per User (ARPU) declines yoy. Average revenue per user is an important parameter in determining the profitability of operators. The ARPUs of the private GSM operators dropped 21% yoy from Rs 479 per subscriber in Q3 FY04 to Rs 396 per subscriber in Q3 FY05. ARPU also fell by 1.51% yoy. Thus; the affordability of services for subscribers was further enhanced during the year, which in turn fuelled subscriber growth.
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During the days when incoming was not free, operator ARPU was almost twice as that of today. Despite of offering various data services over their networks, operators have been unable to uplift the ARPU. This shows that India still is mainly a voice market. On an estimate 80% of operator revenues are voice based and the remaining 20% Constitute of all the data traffic. In such a scenario, operators have a big challenge not only to introduce more and more attractive content but also to see that they add new subscribers on the basis of content not voice. This however will be a big challenging task for Indian operators as promoting data services where roughly 45% of the population is still completely illiterate. To add to the complexity is the language scenario in India. There are 18 languages and 844 dialects and offering streamlined data services in all of these languages are by no means a simple task. The average revenue per user (ARPU) of mobile telephone companies is on the decline and India has one of the lowest ARPU in the world. According to information available with the Telecom Regulatory Authority of India (Trai), (Nov 06).
In terms of revenue per minute, India ranks the lowest with $0.04. China also has the same average revenue per minute of $0.04.
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Operators are constantly seeking to consolidate their standing in the market. Indian telecom regulations limit the number of operators in each circle to four but it does not limit operators acquiring each other. Airtel and Hutch have been very active in these mergers and acquisition activity. Hutchison Telecom (Hutch) recently acquired Aircel which operated in state of Tamil Nadu .Similarly; Airtel acquired Hexacoms licenses for states of Rajasthan and few northeastern states.
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CDMA
CDMA was started in March 2003. There was a big debate in India just before the launch of CDMA services that will it succeed or not? Recent trends reveal that CDMA is here to stay, but that doesn't mean that it is going to overpower GSM. Nationwide roaming helped to boost subscribe base, option of connecting to internet using a simple data cable proved as a catalyst in promoting CDMA services in India. The call tariffs over CDMA were initially lower as compared to GSM but today CDMA and GSM call tariffs are moreover same. Reliance Infocomm was the first private operator to start with the CDMA services in India. However, BSNL and MTNL offered CDMA before Reliance but they were unable to tap subscribers. Reliances strategic alliance with LG and Samsung to offer their handsets along with their subscriptions proved to be a catalyst in the process. Tata Indicom which was the second private operator to offer CDMA services initially failed to attract consumers but since early 2004, it has revived its strategy and has been able to gain some market share.
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Net Additions Of the total subscribers added in Q3 FY05, Reliance contributed over 85%. Reliance added over 1mn customers for the quarter ended December 31, 2006.
Operators WLL/CDMA
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Market Share
By year-end 2005, there will be some 2 billion cellular mobile subscriptions worldwide, cementing the mobile phones position as the most rapidly-growing and widely-adopted technology of all time. Cellular mobile will remain the dominant mobile and wireless technology in 2005. By the end of the year, there will be nearly 2 billion subscriptions worldwide. Voice will continue to be the primary source of cellular mobile revenues, typically accounting for more than 80 percent of total revenue. Price competition will drive voice margins down, but overall demand will continue to grow strongly. As a result, 2G networks will increasingly become cash cows capable of generating EBITDA margins of 45 percent or more. Additionally, a significant minority of voice customers will take a second 2G subscription for data for instance, a mobile e-mail device creating a strong likelihood of mobile penetration surpassing 100 percent in some markets. This will have a real and immediate impact on average revenue per user, making 2005 a very positive year for 2G. Dozens of 3G networks will go live in 2005. Customer interest will initially generally be low due to poor handset performance, disappointing network quality and a lack of compelling benefits. However, mobile operators have faced
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this same situation several times before whenever their network technologies have changed and skepticism will turn to optimism by year-end. Indeed, before The year is over, operators and equipment vendors will likely be delivering a 3G experience that is comparable to 2G. And by 2006, 3G handsets, networks and services will in many cases be noticeably superior to their 2G forebears. On both platforms, messaging will continue to be the primary source of non-voice revenue growth. Chat, instant messaging and other emerging services will grow substantially, taking up the slack as SMS growth declines. Beyond 2G and 3G, many operators will continue spreading their bets adopting new technologies in rapid succession to the detriment of their customers and shareholders. WiFi hotspots will be a prime example, with numerous companies fighting to expand their share of a declining market. Meanwhile, the most compelling and lucrative mobile content will likely continue to be ring tones (already a $2 billion industry), wallpaper, and other simple forms of personalization and self-expression.
c) Internet
Internet made its entry in India in the year 1995 when VSNL (Videsh Sanchar Nigam Limited) started with dial-up connections. The first five years of internet in India could be defined as an incubatory stage where speeds were limited to maximum of 64 Kbps ISDN. Initially and even today most of the home users used to access internet over 28.8 K and 56 K modems. Using internet over phone connection with a modem has two disadvantages, first the phone line is blocked and then one is subjected to pay the regular call charges. This syndrome still exists today with the home users but they still prefer using internet through 28.8 K-56 K modems at home. This situation means that there is a huge potential for broadband service providers to attract customers for their services but only at prices which are affordable. Always on connectivity will help users (both home and corporate users) to keep their phone lines free and avoid call charges.
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Broadband is a collective term for a group of technologies that enable high-speed Internet access, at speeds of up to two megabits per second (Mbps). That is up to 40-times faster than the conventional dial-up medium. In India, the broadband push has only just begun with DSL, cable and wireless options. Traditional dial-up access is being augmented and in some cases replaced by new, more robust access media. To put India on the growth track, 20 million broadband users and 40 million Internet subscribers are being targeted by 2010. The estimated broadband connections in India grew by a whopping 236 percent in 2004 over 2003. But the penetration of broadband is abysmal - 4 users to every 10,000 people and so is the quality of broadband available here. Other countries in the Asia-Pacific region had much better broadband penetration, with the entire region seeing the number of users leap 50 Percent during the year. There were 6.2 crores broadband users across the region by December 2006 compared to 4.1 crores in 2005. Thailand was the fastest growing market with a growth of more than 1,000 percent, while, the others - Malaysia, China, and Australia - at least doubled in growth. China, despite having a huge broadband user base and the biggest broadband market in the region with above 21 million connections, continued to convert dialup customers to broadband, growing by another 100 percent. However, the overall penetration rate there too remained low. Despite the growth seen in 2006 the broadband penetration divide between Asian countries is more extreme than anywhere else in the world and getting more so, It is not just a matter of the penetration of the services, but the access speeds on offer vary widely too. Provider: techtree news staff
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Industry Developments
There is a big way to go for the Indian internet industry still. Although it has been almost 10 years since internet came to India there has been less progress on the bandwidth front. Cyber cafes initially chose 64 Kbps ISDN connection to run multiple PCs. Today these cyber cafes are opting for either smart wireless or DSL broadband. Home users in metropolitan cities have chosen between regular 56 K modem connections Or internet over cable TV. Cyber caf business is not doing well at least in metropolitan cities because the home users which used to visit their cafes earlier to access internet now have option to access internet either over cable TV connection or through smart wireless or subscribe to a 64 Kbps always on connection (not over phone line)
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Access modes
Out of the entire dial-up segment almost 80% are home users. The rest 20% is shared by small businesses. In a small internet population of 6 million subscribers majority of the market share is still with the dial-up connections. Today 55% internet users use net through DIAL UP connections. 17% through LEASED LINES, 10% through ISDN, other 10% through DSL & rest 8% through other ways.
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India Online
Ipeaks
Landsat
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In the ISP market BSNL the public sector giant totally funded by government is leading the market with a market share of 25% which is followed by another government holding MTNL with a market share of 17%. Then comes private sectors company SIFY LTD with its market share of 17%.
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Over the past decade, India has emerged as a preferred location for organizations planning to outsource a variety of services ranging from call centers and other customer interaction services, insurance claims processing, payroll processing, medical transcription, e-CRM and SCM, to back-office operations such as accounting, data processing, and data mining. * ICT, Information & Communications Technology: Electronic means of capturing, storing and communicating information. Modern ICT generally includes telephones, fax, photocopiers, computer hardware and software, and the Internet (e-mail and Web). According to Nasscom, the following areas come under the ambit of IT-Enabled Services:
Customer Interaction Services (including call centers). BPO/Back office operations/revenue accounting/data entry/data conversion (including finance and accounting)/HR services Medical Transcription/translation services Legal databases Digital Content development Engineering and Design services Support Centers Payroll/HR services Website services Data Digitization/GIS and Online education Network consultancy and management Other services including data search and market research
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Classification of ITES
IT enabled services can be classified mainly on the basis of level of complexities in service offered and required expertise. Mckinsey has done the classification on four broad parameters. Service factory is back-end off-shore processing (indirectly to customers) Process Export specializes in processing payroll, general accounting etc. (indirectly to customers) Service line aggregates specialize in a group of related processes like payroll and benefits (directly to customers) Bundled services providers offers combined IT outsourcing and BPO. (directly to customers) Globally there are four types of IT-enabled services vendors who differ by origin and focus In-house/captive centers Spin-offs Focused BPO providers Broad based services providers While in-house providers account for the bulk of the activity at present, the services provided by the other three are growing rapidly. Two broad categories are clearly visible in the current vendor landscape. In-house providers -Out locate business processes to low cost, high skill offshore locations (e.g. India,Ireland,philippiness)using multiple models(e.g. global hubs, regional centers)and outsource the non-core processes to third party vendors.
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Third party providers -Offers distinct value proposition to customers in terms of services offered and are rapidly growing in scale. Indian ITES companies are also undertaking projects in the following areas and segmented along similar lines:
Customer care :This includes database marketing, customer analytics, telesales/telemarketing, inbound call centers, Web sales and marketing, sales and marketing administration
Finance: This covers billing services, accounting transactions, tax consulting and compliance, risk management, financial reporting and financial analysis. Human resources :Areas such as administration, education and training, recruiting and staffing, payroll services, hiring administration, records management are covered here
Payment services :These include credit/debit card services, cheque processing, transaction processing Administration :This covers tax processing, claims processing, asset management, document management, transcription and translation Content development :This area includes engineering, design, animation, network consultancy and management and biotech research
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Weaknesses:
a) Recent months have seen a rise in the level of attrition rates among ITES workers who are quitting their jobs to pursue higher studies. Of late workers have shown a tendency not to pursue ITES as a full-time career. b) The cost of telecom and network infrastructure is much higher in India than in the US.
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Opportunities:
a) To work closely with associations like Nasscom to portray India as the most favored ITES destination in the world. b) Indian ITES companies should work closely with Western governments and assuage their concerns and issues. c) India can be branded as a quality ITES destination rather than a low-cost destination.
Threats:
a) The anti-outsourcing legislation in the US state of New Jersey. Three more states in the United States are planning legislation against outsourcing Connecticut, Missouri and Wisconsin. b) Workers in British Telecom have protested against outsourcing of work to Indian BPO companies. c) Other ITES destinations such as China, Philippines and South Africa could have an edge on the cost factor
Source: Express Computer
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Key Indian cities City Delhi (includes Gurgaon and Noida) Mumbai Bangalore Financial research, back office, software boi-informatics, call centres, IT consulting, tax processing Hyderabad Chennai Software, back office, product design Software, transaction processing, animation Kolkata Pune Consulting, software Call centres, chip design, embedded software Cognizant, World Bank, Standard 51,100 Chartered, Polaris, EDS, Pentamedia PwC, IBM, ITC Infotech, TCS MsourcE, C-DAC, Persistent Systems, Zensar 7,300 7,300 Focus Call centres, chip design, software Prominent firms GE, American Express, Spectramind, Convergys, Daksh, ExL TCS, MphasiS, i-flex, Morgan Stanley, Citigroup 109,500 SAS, Dell, Tisco, TI, Motorola, HP, Oracle, Yaho, AOL, E & Y, Accenture HSBC, Satyam, Microsoft 36,500 62,050 Employees 73,000
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Rank 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
Company EXL Services.com (I) Pvt. Ltd. Daksh eServices Pvt. Ltd. GTL Ltd. Spectramind Datamatics Technologies Ltd. Tracmail India Pvt. Ltd. Brigade Corporation Epicenter Technologies Pvt Ltd Firstring 24/7 Customer
Source: Nasscom
RANKING OF INDIAN ITES CITIES CITY RANK HYDERABAD 1 KOCHI 2 CHENNAI 3 KOLKATA 4 AHMEDABAD 5 BANGALORE 6 MUMBAI 7 NCR 8 PUNE 9
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The top nine cities include Ahmedabad, Bangalore, Chennai, Hyderabad, Kolkata, Kochi, Mumbai (including Navi Mumbai), Pune and NCR (Delhi, Noida and Gurgaon). The cities are assessed on factors such as manpower availability, real estate, telecom infrastructure, policy initiatives, power infrastructure, city perception and entrepreneurial history. About 90% of all ITES companies in India are concentrated in nine major cities while others have not been able to attract more than two companies each. A large number of ITES companies being based in Mumbai, NCR and Bangalore, these cities are facing increasing competition from other cities. Cities such as Hyderabad and Kochi are emerging as attractive ITES destinations primarily due to rapid improvements in infrastructure (power, international bandwidth and urban transportation) and lower manpower costs due to lower cost of living and lack of alternative employment opportunities in these cities. According to NASSCOM, the ITES industry in India is experiencing the third wave of growth; both in terms of geographical areas of operation and services offered In the first phase, the industry was dominated by captive centers of large multinationals such as GE, American Express, and Swiss Air who set up operations in leading metros of the country such as Delhi and Mumbai
In the second phase, the growth of the industry attracted numerous entrepreneurs (in many cases, employees of multinationals who quit their jobs to set up their own ITES ventures) again in and around Delhi (NCR) and Mumbai (including Navi Mumbai) The third phase of growth has been more geographically dispersed - with new locations emerging such as Hyderabad, Pune, Bangalore, Chennai, and more recently, Kochi.
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The growth has been driven by three factors: The desire by state governments to attract entrepreneurship, which resulted in the former offering attractive policy environments and incentives The rapid improvement in key infrastructure such as power, telecom bandwidth, and real estate in newer locations The need for ITES companies to lower operating costs (especially employee costs, and transportation Hyderabad has emerged as the most competitive city for ITES. Chennai, Kochi and Kolkata too rank highly in their infrastructure offerings, policy incentives, and low cost manpower availability though not at the same level as Hyderabad. On the other hand, Ahmedabad, which ranks highly on availability of low cost manpower, loses out on competitiveness as a result of weaker policy incentives and infrastructure availability. Bangalore, Mumbai, NCR and Pune ranked low in infrastructure availability, policy support and availability of low-cost manpower.
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posted the highest growth among all the segments in India's growing software and services marketplace, reaching revenue of Rs.1215900 crores in 2004-05. The industry, which has grown almost five-fold since 2000, recorded a CAGR of 28 percent for the 2000-05 periods. The ITES industry's contribution to the nation's GDP rose from 1.2 percent in 1997-98 to touch 3.5 percent in 2003-04. With a growth of around 31 percent during 2004-05, the sector has
about 4.1 percent of the GDP. According to a study conducted by Nasscom, this growth is in line with overall global industry trends, and is likely to continue over the next few years. In the ITES sector, the captive units of global corporations continue to dominate the scene. The share of captives 62
in ITES exports for 2005-06 is estimated to be 56 per cent. The disparity in growth rates of large Indian third party vendors (TPVs) and other players in the industry are also significant. While large Indian players have grown exponentially over the past 2 years, other players within the industry have registered a CAGR of 13 per cent over the 2-year period
Business intelligence major International Data Corporation (IDC) has predicted that the IT-enabled services market globally will account for revenues of US$ 1.2 trillion by 2006. With growth projected at 11 percent annually, the ITES segment will be one of the most significant business opportunities for the Indian software and services industry. . Propellers for growth The Global market for ITES sector is expected to be around US $ 611 billion by 2005 and India is expected to capture at least 10% of it. Lots of people, with basic education and a mastery over English-this is Indias strength points out an industry expert. This is why China and Philippines have not been able to dominate the ITES market; though they have cheap labour, they are not yet fluent in English. Thus the Indian ITES industry remains buoyant, at least till China catches up. Currently employing about 106,000 people in India, the ITES industry is estimated to give employment to more than one million people by 2008.
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ITES opportunities by 2008 Service Lines HR Customer Care Payment services Content development and others Administration Finance Total $billion 3.5 4 8 - 8.5 3 - 3.5 2.5 3 1.5 2 2.5 3 21 24
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RESEARCH METHODOLOGY
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to formulate specific question with the help of primary and secondary data. Grand amount of flexibility and on ad-box variability. No detailed and definite
DATA COLLECTION
The success of research project depends critically on data. In any marketing research program data collection is very important. Data collection is an integral part of marketing information system. A) PRIMARY DATA:Information, which has to be gathered for the first time, is Called Primary Data. TOOLS USED FOR COLLECTING PRIMARY DATA: (i) Open ended questionnaire and interviews. (ii) Detailed discussions with the senior executives and departments. B) SECONDARY DATA:Data, which are already assembled, are called secondary data:TOOLS FOR COLLECTING SECONDARY DATA: (i) Organization annual report. (ii) Different report and periodicals of soft drinks association. (iii) The economic times. (iv) Magazines.
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To get accurate information different types of functions were performed. The most important limitations, which come on, the way of investigations was lack of time. The data were available on certain aspects but sufficient date and satisfactory progress report could not be made available. However, the major difficulty was that it was not possible to visit the corporate plant at Bombay. Although a cherished desire persisted above mentioned constraint hindered the progress of this project.
The data are collected from Both Primary and Secondary Sources.
Primary Data:
Direct interview with retailers and Distributors of Dehradun Gather information through Questionnaire Through telephonic conversation
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In Saharanpur city only 14% retailers have glow sign boards.14% retailers have glow sign boards but when we reached to the shop we dont find any glow sign board their.48% retailers required glow sign boards & they have already applied for glow sign boards but yet not received. 10% retailers in the city dont have enough space for glow sign boards. 9% boards are of wrong name boards for which retailers are regularly complaining but no response results.5% boards are not in working condition means tube is fused, board is depreciated etc.
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Problems related to point of sale material (p.o.s) is that only 60% retailers receive P.O.S material in time .it means rest 40% dont not receive the p.o.s material in time or they dont receive the material. This shows that we are not covering the rest 40% retailers, which are also a big part. This affects our sale very much & our competitors are encashing this opportunity. As per our survey is concerned 18% retailer do not receive P.O.S material in time & 22% dont get the material.
In problems related to claims 30.75% retailers says that they have pending claims with the company. As per the survey is a concerned 69.25% retailer dont have claims? In Saharanpur city problem related to claim is a big issue. Retailers have pending claims with the company & with old distributor. They dont know who will settle their claims either company or by the distributors.
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Percentage
Series1
2% low signals
In problems related to network 90% area of the Saharanpur city is covered by the network of Airtel. In some areas of Saharanpur only 2% areas have low signals. In the outer areas of Saharanpur city 8% areas have no network coverage. So the numbers of customers are very few in those areas. The network of airtel in the city is good. But in some areas the frequency of the tower is low so there is low signal problem.
LAPU STATUS
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LAPU
400 350 300 250 RETAILERS 200 150 100 50 0 HAVE LAPU LAPU REQUIRED LAPU STATUS DON'T HAVE LAPU 28 27 Series1 375
In Saharanpur city out of 430 retailers only 375 retailers have lapu. 28 retailers required lapu & they have applied for the lapu facility.27 retailers are those who dont have lapu facility.
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In problems related with lapu 2% retailers have problem of lapu reversal.2% retailers have lost but they dont receive the new one. Rest 96% retailers have no problem.
VISIBILITY INDEX
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VISIBILITY INDEX
TATA B.S.N.L 5% 4% IDEA 9% AIRTEL HUTCH AIRTEL 55% IDEA B.S.N.L TATA
HUTCH 27%
In visibility index we find that AIRTEL have a market visibility of 55% in the Saharanpur city. HUTCH is the first biggest competitor of Airtel with a market visibility of 27%.IDEA has a market visibility of 9% & comes on third stand. TATA is the fourth competitor of Airtel with a market visibility of 5%. Then comes government owned B.S.N.L with a market visibility of 4%.All this shows that Airtel have got biggest part in the market visibility.
MARKET SHARE
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MARKET SHARE
14% 32% AIRTEL HUTCH BSNL 5% TATA IDEA RELIANCE 23% 16%
10%
Market share of AIRTEL in Saharanpur city is 32% then comes BSNL with market share of 23% .Hutch & reliance have 16% & 14% respectively. IDEA has market share of 10% while TATA INDICOM has a market share of 5%.
RECOMMENDATIONS
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1. The market position of airtel is very strong but it has not been capitalized properly because of poor supervision of distributors .distributors should also keep in mind the far flung areas and should cater it properly because rural markets are emerging as great source of increasing volumes. 2. Distributors should keep manpower accordingly. There should be adequate personnel to look after the market. 3. From management side, management should have a feedback system which can link them directly to retailers. This will help them gaining confidence of retailers and solving their problems. 4. Point of sales materials should be checked timely so that they can be maintained accordingly. 5. Claims should be settled as early as possible because delay causes irritation in the minds of retailers, which causes dissatisfaction on the part of retailers. 6. A regular comparative study of the market should be taken at regular intervals because it will give insight information about our market share.
CONCLUSION
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After the Finding and analysis of the gathered information and data, at last I have reached on the conclusion part of the Project. I have concluded this project as... 1. Airtel is the most trusted brand & Majority of Airtel customers are not ready to switch to any other service provider as they are completely satisfied with the products and services offered by it . 2. Management is able to develop cordial relationship with retailers but the claim settlement process is slow and not conducive to retailers. 3. Lack of sales force with distributors creates lots of unnecessary hackles. 4. Far flung areas are not managed properly. 5. Bifurcation of paper recharge and lapu creates lots of problems for Retailers.
Annexure
QUESTIONNAIRE Visibility index Problem identification 1. General information: a. Retailers Name: ___________________________________ b. Name of the Retail Outlet ___________________________________ c. Location & Phone No. ____________________________________ d. Contact / Lapu No. ____________________________________ 2. Does the retail outlet have all airtel promotional materialsa. Glow sign board b. If yes then c. Size of the board i. Problem Yes [ Working [ ] ] No [ Not working [ ] ]
______________x_______________ ______________________________ ] No [ ]
4. Have you assigned a proper / permanent place for Airtel promotional material? Yes [ No [ ] ] ] ___________x______________
] c) Not visible [ ] No [ ]
6. Does the F.S.E & F.C.E. visits on their designated days? Yes [ ] No [ ] 7. Do you receive stocks as per the order? Lapu [ ] Sim [ ] PRC [ ]
] ]
Hutch [ Reliance [
] ]
Idea [ BSNL [
] ]
9. Number of Airtel connections sold by you per month? ___________ 10. What is the monthly sale of Airtel recharge a) Vouchers _____________ b) Lapoo_________________ 11. Rank these companies on the basis of your monthly sale (1-6) Airtel [ ] Hutch [ ] Idea [ ] Reliance [ ] Tata Indicom [ ] Bsnl [ ] Size of various glow sign boards available in the shop :Airtel ____________x________________ Hutch ____________x________________ Idea ____________x________________ Reliance ____________x________________ Tata Indicom ____________x________________ Bsnl ____________x________________ ] ]
12.
13. Rate the Airtel on the basis of your satisfaction level:Very good [ ] Good [ ] Average [ ] Poor [ 14. Rate the distributor on the basis of your satisfaction level:Very good [ ] Good [ ] Average [ ] Poor [ 15. What are the problems faces by you? _______________________________________________ _______________________________________________
BIBLIOGRAPHY 83
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