TELECOM SYSTEM

MANAGEMENT BUSINESS OF SYESTEM

BY:PRESENTATION
INTEGRATOR’S
Vijay singh: Balaji institute of telecom & management,Pune (2008-10)
TELECOM AS A FACILITATING INFRASTRUCTURE
FOR ECONOMIC DEVELOPMENT OF COUNTRY
Introduction to Indian Telecom
Industry
• The Indian Telecom sector is third largest network in the world.

• Subscribers base is around 442 million.

• Average growth rate of over 48% in respect of subscribers.

• Monthly additions of above 11.7 million phones.

• Growth impetus from wireless segment with 84% wireless and 16% wired.

• Overall teledensity at 37.94%.

• Rural teledensity stands at 7%, while the urban at 57%.

• Further access is provided by 54 lakh PCOs and 5 lakh VPTs.

• Broadband subscribers crosses 6.28 million .

• More than a thousand cities have been provided with broadband connectivity out a total of
five thousand cities

Source = Telecom News, Value notes (08-09)

Indian Telecom Industry – A Lucrative Option
Indian Telecom Industry – Facts
 One of the fastest growing
cellular markets in the world
in terms of number of
subscriber additions – 442
million (April 2009)
 Expected to reach total
subscriber base of about
500 million by 2010 (i.e.,
more than one phone for
every household)
 Annual growth rate of the
telecom subscribers – 48
percent (2008-09 )
 More GSM subscribers than
fixed-line subscribers
 Total Fixed line User base
is 37.81 million .
 Tele density – 37.94% (April
2009)
 ARPU for GSM – Rs 220
 For CDMA-Rs111
 Telecom equipment market
– USD 34,100 million (2007–
08)
 Handset market – USD 7,250
million (2007–08)
• Data Source = TRAI 2008
Report
Telephony services (mobile and basic) and Internet
services dominate the Indian telecom services

-The Indian telecom market generated revenues of approx. USD 32 billion in 2007–08.
- Registered a CAGR of approx. 32 percent from 2002–03 to 2007–08.
-The CAGR from 2008–08 to 2011–12 is expected to stabilise at 21 percent.
Revenues of Indian Telecom Industry: 2002–08 (USD
billion)

Mobile Services
Basicc es
In
te
Servi rn
e t
Raagin

Telecom Services – India

P

S
di g

RT
o

PM

G MP C S VSATs

The Indian telecom services can be divided predominantly into basic, mobile and Internet services .

It also comprises smaller segments :-

-Radio paging services,

-Very Small Aperture Terminals (VSATs)

-Public Mobile Radio Trunked Services (PMRTS)

-Global Mobile Personal Communications by Satellite (GMPCS).

Number of mobile subscriber will propel the total subscriber
base to 500 million by 2010

Telecom Subscriber Base and Teledensity in India

(2002-2009)

* In terms of Subscriber Base

** Includes GSM, CDMA and WLL-F services
Market Share Of GSM Subscriber (April 09)

Source-voice & data

CDMA subscriber base-(2009)

Reliance Communications and TTSL

dominates the Indian CDMA mobile
services segment.

Source = Telecom India online.

Source-voice &
data
Broadband services to drive Internet penetration in India

Internet Subscribers: 1998–2008

BSNL and MTNL caters to more than two-thirds of

Internet subscribers in India.

The telecom market will experience high

penetration of Internet services with the support
from government policies .

Source=IT Sector News (07-08)

Indian telecom handset market booming along with mobile
services industry

Mobile Handsets Market in India: 2004–07

Market Share of GSM and 4 ,7 5 0
5 ,0 0 0
CDMA Handset Manufacturers:
2006–07 4 ,0 0 0
3 ,2 3 1
Huaw ei Others 3 ,0 0 0

USD Million
Haier 1% 1 ,9 6 6
7% 2 ,0 0 0 1 ,6 1 0
1%
1 ,0 0 0
ZTE
4% 0
2003–04 2004–05 2005–06 2006–07
Sams ung
6%

Overall, Nokia has a market share of 53

Sony Eric s son
Nokia percent; it dominates the GSM mobile
6%
53% handsets with a market share of
approximately 73 percent.
LG
11% LG dominates in the CDMA handsets
market with a market share of 60
percent.
Motorola
11%
Source= Telecom India Online.
(06-07)
 Growth in India
GDP Growth Forex FII Flow FDI Per Capita Inflation

1990 5.8 per cent < US$ 1 billion US$ 1 million US$ 97 million3 US$ 390 9 per cent
(1993)

2008 7.7 per cent US$ 254.75 billion US$ 4.7 billion US$ 18.7 billion US$ 740 5.24 per cent
as on January 9, (August 2008) (April–October as on January
2009 2008–09) 3, 2009
 India's Forex Reserves: 2001–08
350
310
300
255
250
199
US$ Billion

200
152
141
150
112
100 75
54
50

0
2001–02 2002–03 2003–04 2004–05 2005–06 2006–07 2007–08 Jan-09

In 2007–08, forex reserves grew by approximately 56

per cent over 2006–07. They were recorded at more
than US$ 254.75 billion in the third quarter of 2008–
09.1
Source-voice &
data
 Number of Deals and Value
80 1,081 1,200
70

Number of deals
70 1,000
60
782 766 800
US$ Billion

50
41.54
40 467 600
28.2
30 306 400
20 18.3
12.3 200
10
0 0
2004 2005 2006 2007 2008
Deal Value No. of Deals

 The IT & ITeS sector witnessed maximum M&As (102).

 By value, the telecom sector leads the pack with M&As
worth US$ 5,783.95 million.

Source-voice &
data
 Recent Deals……
• Norway-based telecom operator Telenor has bought a 60 per cent stake
in Unitech Wireless (Videocon subsidiary ) for US$ 1.23 billion.

• Japanese telecom major NTT DoCoMo has acquired a 27.31 per cent
equity capital of Tata Teleservices for about US$ 2.6 billion and a 20.25
per cent stake in Tata Teleservices (Maharashtra) Ltd for about US$
190.23 million.

• Singapore Telecommunications (SingTel), which has a 31 per cent

stake in Bharti Airtel has received the government’s approval to offer
long distance services in India .

• Mauritius-based P5 Asia Holding Investments (Mauritius) Ltd will be

investing around US$ 545.13 million to hold a 20 per cent stake in
Aditya Birla Telecom Ltd (ABTL).

• Bharat Sanchar Nigam Ltd (BSNL) is planning an investment of around

US$ 201.5 million in the Tamil Nadu Circle for an additional 23 lakh
mobile connections under both 2G and 3G technologies by 2009.
 Contd…
• Etisalat, a Gulf-based telecommunications company has picked up
a 45 per cent stake in Swan Telecom.

• Juniper Networks, second-largest maker of networking equipment,

plans to invest US$ 400 million in India, over the next five years,
with a focus on its research and development (R&D) activity.

• BSNL, India's leading telecom company in revenue terms, will put in

about US$ 1.16 billion in its WiMax project.
Drivers of Growth
 44% population < 19 years; 75% literate
 Working population to grow from 485 mn to 615
Changing mn by 2010
demographics  21 mn professionals and 90 mn graduates/ post
graduates by 2010
 500 mn consuming class by 2007

 Unified licence provides unprecedented

Government flexibility to operators in optimising costs and
Policies services by leveraging technology and
economies of scale

Low Entry  Drop in the handset prices … lowering the

Barrier entry barrier… Lowering Tariffs… Increasing
affordability
India: Demographic Dividend

45 Population Median Age (in years): 2008E1

36
 Young population (under 25 years)
27
Years

44 accounts for about 50 per cent of

18 37 38
34
25 India’s total population.
9
 The country’s urban population
0
India China US Russia Japan accounted for 29 per cent of the total
population in 2007 and is the second-
largest in the world. It is projected to
reach 37.8 per cent by 2025.

Growth in Working Age Population (15–64 years)

by 2010 (in million)

Stock
Position
Additions to Working Age Population by 2010
2005
 India is expected to register the 314
World 4,16
largest addition to the working India 8 71
69
64
age population in the world by Africa
1
50 44
0
2010. China 93 33
4
South East 36 31
 The country is expected to be Asia 2 17
Latin 35
powered by the largest working America
Southern
9
13
10
0
age population worldwide by Asia
US
2
20 -3
0
2050. Europe 49
-5 45 95 145 195 245 295 345
7
Japan 8
 Its labour costs, as a percentage 5

of value added, are 1.one

Sources: CIA of the
In million
lowest among Asian2.countries.
International Herald
4 Tribune
3. United Nations Statistics
4. India Brand Equity Foundation
Ideal Destination for Investment
• 100 per cent foreign direct investment (FDI) is permitted
through the automatic route in telecom equipment
manufacturing.

• FDI ceiling in telecom services has been raised to 74 per

cent.

• Introduction of a unified access licensing regime for

telecom services on a pan-India basis.
 Contd…
• The government is implementing a program of
connecting 66,822 uncovered villages under the Bharat
Nirman programme.

• The government will invest US$ 2 billion to set up 1.12

lakh community service centres in rural India to provide
broadband connectivity in 2008-09.

• The Finance Ministry has declared a five-fold (from US$

100 million to US$ 500 million) increase in the external
commercial borrowings amount, which companies
involved in infrastructure sectors can borrow from
overseas to spend in India.
 Investments Abroad
• The Bharti Group, launched its mobile services in Sri Lanka under
'Airtel' brand on January 12, 2009.

• Airtel is expected to invest about US$ 200 million in setting up and

expanding its operation in Sri Lanka over the next five years.

• Tata Communications has bought the 30 per cent stake in Neotel

that was previously held by Eskom and Transnet.

• With this, Tata Communications in association with Tata Africa

Holdings became the largest stakeholder with 56 per cent stake.
fahfauhfanamnajodndkjdk
Facts about Indian Telecom Sector

• Indian telecom sector is almost unaffected by this adverse global

trend.
• Its contribution to the nation's GDP is expected to increase from
2% in 2006 to an estimated 3.6% in 2010.
• Growth rate for Reliance in January 2009 at 8.1%, followed by
Idea at 5.4%, Aircel at 4.3%, Vodafone and Spice Telecom at 4%
each and Bharti at 3.2%.
• India states that India has a teledensity of 34.5% as of January
2009, up from 33.2% in December last year at 4% each and
Bharti at 3.2%.
 Continued…….
• Gartner estimates the Indian mobile market will
expand to 737 million subscribers by 2012.
• The companies now pay the government 10, 8 and 6
per cent, depending on the markets they operate in.
• By 2009 Fixed line and mobile revenues in India will
hit US$10.5 billion and US$23.4 billion, respectively.
Capital expenditure (capex) is estimated at US$2.2
billion & US$6.5 billion.
Continued…….
• India's mobile subscriber base is expected to grow at a compound
annual growth rate (CAGR) of 18.3 percent, from 2007 to 2013,
reaching a penetration rate of 53.4 percent by end-2013.
• The government will also invest US$2 billion, from 2008 to 2009,
to set up some 100,000 community service centers in rural India to
provide broadband connectivity.
• Currently, MVAS in India accounts for 10 per cent of the
operator's revenue, which is expected to reach 18 per cent by 2010.
Continued…….
• By 2012, fixed line revenues will reach US$12.2 billion and
mobile revenues will hit US$39.8 billion. Fixed line capex is
expected to be US$3.2 billion, while mobile capex will be
US$9.4 billion.
• With the tele-density in rural areas at less than 10 percent against
the national average of about 21 percent, there seems to be huge
untapped potential for mobile phone penetration in rural India.
• Mobile phone production is estimated to grow at a CAGR of
28.3 per cent from 2006 to 2011, totaling 107 million handsets
by 2010.
Continued…….
• Revenues are estimated to grow at a CAGR of 26.6 per
cent from 2006 to 2011, touching US$ 13.6 billion.
• 100 per cent foreign direct investment (FDI) is permitted
through the automatic route in telecom equipment
manufacturing.
• BPO for telecom is also a huge job creator, employing
over 1,22,440 people in BPO firms in 2008 — a number
that is set to more than double to 2,94,444 in 2012.
BUSINESS OF SYSTEM
INTEGRATOR’S
 Contents
Contents
• What means system integration.
• Why SI Required.
• How SI implemented.
• Players in SI field.
• Presence Asia/Pacific(India).
 WHAT SYSTEM
WHAT ISIS INTEGRATOR
SYSTEM INTEGRATOR
• A systems integrator is a person or company that specializes
in bringing together component subsystems into a whole and
ensuring that those subsystems function together, a practice
known as System Integration.

• According to the Institute for Partner Education &

Development, systems integrators traditionally realizes
approximately 50 percent of revenue from consulting services
and 40 percent of revenue from IT services in design,
implementation and post-transaction consulting. They are
different from an IT Consultant in that they also take title to
product.
 Why
Why SI Required?
SI Required?

• The market and competitive pressures within the

Telecom industry have made time-to-market, offering
differentiation and operational efficiency critical
success factors.

• SI by providing end-to-end solutions, solution

integration & deployment and professional services
over a wide range of solution areas.
 Role of Role
SI in ITin IT
of SI

• In IT, system integrators integrate multiple systems for

inputting, processing, interpreting, storing, and categorizing
data.

• For example, a systems integrator may build an IT solution

integrating an Oracle-based inventory tracking system, a
document management system, a Microsoft CRM system, a
group of Panasonic scanners, and a Rimage storage system to
produce an overall solution for the customer.
How SI Implemented??
How SI Implemented?
PLAYERS IN STSTEM
INTEGRATION
 Players
Players in SIin SI field
field

• Accenture
• Atos Origin
• BearingPoint
• Booz Allen Hamilton
• Capgemini
• Cisco Systems
• CSC/CSA
• Deloitte
• Dimension Data/Datacraft
• EDS
• Ericsson
• Fujitsu
 Continue..
Continue..
• GTL
• HP
• IBM
• Lockheed Martin
• LogicaCMG
• McKinsey & Company
• Mincom
• NCR
• NCS
• Oracle/PeopleSoft
• SAP
• Satyam Computer Services
• Sun Microsystems
• Tata Consultancy Services
• Unisys
 SIMarket
SI Market DNA
DNA Scan Scan
• The IT consulting and SI services markets within the
Asia/Pacific region are valued at $12.8 billion.

• The adoption rate of these services across markets in

Asia/Pacific is vastly different.

• The compound annual growth rate (CAGR) of 9.7 percent for

2005 through 2009.

• Developing IT services markets such as India and China will

see significantly higher CAGR than the regional average.
Market share
Market sharesegmentation
segmentation in in Asia/Pacific
Asia/Pacific
 Geographical
Geographical SpreadSpread
of ESPofConsulting
ESP Consulting
and SIand SI Services in
ServicesRevenue
Asia/Pacific Revenue in Asia/Pacific
 Vertical
Vertical Spread ofSpread of ESP
ESP Consulting Consulting
and and SIin Services
SI Services Revenue Asia/PacificRevenue
in Asia/Pacific
 SI’s - Offering
SI’s - Offering
TCS (www.tcs.com) TCS provides a range of IT services,
such as applicationdevelopment and
maintenance, business process
outsourcing,consulting services and IT
infrastructure services.

Accenture (www.accenture.com) Accenture is a well-established IT

consulting provider in the region.
The company has strong focus in
consulting and SI services for gov,
financial services, communications and
utilities. Its strengths occur in customer
relationship management, human
performance, finance and performance
management, strategy andsupply chain
management
IBM (www.ibm.com) IBM is a well-established full-service
provider with strong strategic
consulting services via its Business
Consulting Services group. Its
business transformation offering is
building traction in the Asia/Pacific
markets. IBM also has a broad set of IT
consulting,application development and
SI skills.

HP (www.hp.com) HP provides consulting and SI services

to a focused target market in
manufacturing, network service
provision, government and finance
industries. Its Adaptive Enterprise
transformational services is
building traction in some Asia/Pacific
markets
 Summary
Summary of SIofService
SI Service Offerings
Offerings (Systems
(Systems Integration
Integration and and
Application
Application Development Services)
Development Services)