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Telecom Sector in India

Telecom Sector in India

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Published by naanushande
A report on Telecom Sector in Indian, which was done as part of academic domain study.

The data has been taken from different sources. The sources are mentioned in reference page.
A report on Telecom Sector in Indian, which was done as part of academic domain study.

The data has been taken from different sources. The sources are mentioned in reference page.

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Published by: naanushande on Aug 14, 2009
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05/01/2013

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The rapid growth in Indian telecom industry has been contributing to India’s GDP at large. Telecom

industry in India started to set up in a phased approach. Privatisation was gradually introduced, first in
value-added services, followed by cellular and basic services. Telecom Regulatory Authority of India
(TRAI), was established to regulate and deal with competition (the service providers). This gradual and
thoughtful reform process in India has favoured industry growth. Upcoming services such as 3G and
WiMax will help to further augment the growth rate.The Indian telecommunications industry is one of
the fastest growing in the world and India is projected to become the second largest telecom market
globally by 2010.

This is evident from the facts of Telecom Industry for example, India added 113.26 million new

customers in 2008, the largest globally. The country’s cellular base witnessed close to 50 per cent

growth in 2008, with an average 9.5 million customers added every month. This would translate into
612 million mobile subscribers, accounting for a tele-density of around 51 per cent by 2012. It is
projected that the industry will generate revenues worth US$ 43 billion in 2009-10.

In this report we have tried to capture most of the areas of Telecom Industry. Major highlights of the
report are History of Telecom Industry, Current Industry Analysis, Role of TRAI, Spectrum allocation, FDI
Regulation, Competitive advantages, Outsourcing in Telecom, Emerging Technologies, Latest Innovation,
and Growth Trends, Mergers and Acquisitions.

Telecom Industry

Anjana, Prachi, Puneet, Sandeep

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Table of Contents

Executive Summary ....................................................................................................................................... 2
1 Indian Telecom Industry ....................................................................................................................... 6
1.1 History ........................................................................................................................................... 6
1.2 Quick Facts .................................................................................................................................... 6
1.3 Telecom services ........................................................................................................................... 6
1.4 Industry Sectors ............................................................................................................................ 7
1.5 Growth Avenues ........................................................................................................................... 8
1.6 Industry Revenue (2002-2010) ................................................................................................... 10
1.7 Subscriber Growth ...................................................................................................................... 11
1.8 Major Players .............................................................................................................................. 11

1.8.1

Wireless Service Providers (Market share) ......................................................................... 12

1.8.2

Handset Manufacturers (Market share) ............................................................................. 12
1.9 Major Investments ...................................................................................................................... 13
1.10 Rural Telephony .......................................................................................................................... 13
1.11 Exploring the rural telecom opportunity .................................................................................... 13
1.12 Policy Initiatives .......................................................................................................................... 14
2 Telecom Regulatory Authority of India (TRAI) .................................................................................... 15
2.1 Mission ........................................................................................................................................ 15
2.2 Role of TRAI ................................................................................................................................. 15
2.3 Recommendatory Functions ....................................................................................................... 15
2.4 Mandatory Functions .................................................................................................................. 15
2.5 Other functions ........................................................................................................................... 16
3 Spectrum Auctions in India Vis-à-vis Worldwide ................................................................................ 17
3.1 Spectrum Auction Scenario in India ............................................................................................ 17
3.2 Gaps in Indian Spectrum Auction Licensing Scenario ................................................................. 18
3.3 3G Spectrum allocation policy in India in 2009........................................................................... 19
3.4 Comparison-Spectrum Allocation Policy in UK ........................................................................... 20
4 India’s Competitive Advantage ........................................................................................................... 21
4.1 Stable Economic Outlook ............................................................................................................ 21
4.2 Large Market Potential ............................................................................................................... 22
4.3 Large Talent Pool ........................................................................................................................ 22

Telecom Industry

Anjana, Prachi, Puneet, Sandeep

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4.4 Low Labour Cost .......................................................................................................................... 23
5 The Road Ahead .................................................................................................................................. 25
5.1 Gradual Progression in Telecom Sector ...................................................................................... 25
5.2 Acquiring New Subscribers through expansion in Rural India .................................................... 26
5.3 Selling More to Existing Subscribers ........................................................................................... 26
5.4 Government Initiatives ............................................................................................................... 26
5.5 The reasons for the increasing importance of MVAS can be classified as:................................. 26
5.6 Defining VAS ................................................................................................................................ 27

5.6.1

Basic definition of a VAS ..................................................................................................... 27

5.6.2

Definition as per TRAI ......................................................................................................... 28
5.7 Mobile VAS in rural market ......................................................................................................... 28
5.8 Access devices for MVAS ............................................................................................................ 29

5.8.1

GPRS Handsets .................................................................................................................... 29

5.8.2

3G Handsets ........................................................................................................................ 30
6 Key trends in telecom industry ........................................................................................................... 31
6.1 Mobile Number portability (MNP) .............................................................................................. 31

6.1.1

The Inhibitors ...................................................................................................................... 31

6.1.2

MNP Implementation globally ............................................................................................ 32
6.2 Wimax v/s 3G .............................................................................................................................. 33
6.3 Mobile Virtual Network Operator (MVNO) ................................................................................ 34
6.4 IPTV ............................................................................................................................................. 35
7 Industry Updates ................................................................................................................................. 37
7.1 Consolidation in Industry. ........................................................................................................... 37

7.1.1

Idea Cellular’s Acquisition of Spice Telecom ....................................................................... 37

7.1.2

Vodafone’s entry into India ................................................................................................ 37

7.1.3

Telenor-Unitech Deal .......................................................................................................... 38

7.1.4

TTSL – DoCoMo Deal. .......................................................................................................... 38

7.1.5

Bharti-MTN deal (in talks). .................................................................................................. 38
7.2 FDI Investments in the Telecom Sector in India: ........................................................................ 40
7.3 Outsourcing by Telecom Service Providers in India .................................................................... 41

7.3.1

Hutchitson Essar (now Vodafone) and Nokia Deal: ............................................................ 41

7.3.2

Bharti Airtel’s IT Outsourcing to IBM: ................................................................................. 41

Telecom Industry

Anjana, Prachi, Puneet, Sandeep

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7.3.3

Bharti’s Outsourcing to Alcatel-Lucent: .............................................................................. 42

7.3.4

Bharti Outsourcing Deal with Nokia & Ericsson .................................................................. 42
8 Future Technology Trends .................................................................................................................. 43
8.1 IP Multimedia Subsystem (IMS) .................................................................................................. 43
8.2 High Speed Downlink Packet Access (HSDPA) ............................................................................ 44
8.3 4G or Fourth Generation Networks ............................................................................................ 44
9 Conclusion ........................................................................................................................................... 46
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References ...................................................................................................................................... 47
Appendix A .................................................................................................................................................. 48

Telecom Industry

Anjana, Prachi, Puneet, Sandeep

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