Assignment On Essentials of Marketing

Submitted To Group 9 Prof. Sujata Joshi

Farhan Ahmad Khan 10020541051 Siddhesh Raban Rajthilak G Pritesh Bohra Shobhneet Bhargava 10020541052 10020541053 10020541055 10020541056

Vodafone Group plc is a British multinational mobile network operator headquartered in Newbury, England. Vodafone is the world's largest mobile telecommunication network company, based on revenue. It currently has operations in 31 countries and partner networks in a further 40 countries. Based on subscribers, it is the world's second largest mobile phone operator behind China Mobile (538 million subscribers), with over 428 million subscribers in 31 markets across 5 continents as of March 2010. As of March 31, 2009, the company employs more than 79,000 people worldwide. The name Vodafone comes from voice data fone, chosen by the company to "reflect the provision of voice and data services over mobile phones". Vodafone was formed in 1984 as a subsidiary of Racal Electronics Plc. Then known as Racal Telecom Limited, approximately 20% of the company's capital was offered to the public in October 1988. It was fully demerged from Racal Electronics Plc and became an independent company in September 1991, at which time it changed its name to Vodafone Group Plc. Following its merger with AirTouch Communications, Inc. (‘AirTouch’), the company changed its name to Vodafone AirTouch Plc on 29 June 1999 and, following approval by the shareholders in General Meeting, reverted to its former name, Vodafone Group Plc, on 28 July 2000.

Vodafone in India
Vodafone Essar, formerly known as Hutchison Essar covers 23 telecom circles in India and is based in Mumbai. Vodafone Essar is owned by Vodafone 67% and Essar Group 33%. It is the second largest mobile phone operator in terms of revenue behind Bharti Airtel, and third largest in terms of customers. On February 11, 2007, Vodafone agreed to acquire the controlling interest of 67% held by Li Ka Shing Holdings in Hutch-Essar for US$11.1 billion, pipping Reliance Communications, Hinduja Group, and Essar Group, which is the owner of the remaining 33%. The whole company was valued at USD 18.8 billion. The transaction closed on May 8, 2007. Despite the official name being Vodafone Essar, its products are simply branded Vodafone. It offers both prepaid and postpaid GSM cellular phone coverage throughout India with good presence in the metros. Vodafone Essar provides 2.75G services based on 900 MHz and 1800 MHz digital GSM technology, offering voice and data services in 23 of the country's 23 licence areas. It is among the top three GSM mobile operators of India.

VODAFONE: Industry Vertical

Vodafone in India mainly operates under two verticals of the telecom industry. They are: 1. Mobile Infrastructure In November 2007, in a strategic move, three leading GSM operators in India — Bharti Airtel, VodafoneEssar and Idea Cellular —decided to form an independent tower company — Indus Towers Limited — that provides passive infrastructure services to all operators leading to lower operating costs and more competitive operative environment. The three companies merged their passive infrastructure assets in 16 telecom circles in India. Bharti Airtel and Vodafone Essar have 42 per cent stake each, while Idea has the remaining 16 per cent stake in Indus Towers. Indus Towers with a portfolio of more than 100,000 towers is already the largest tower company of the world, ensuring significant scale benefits for its customers by way of ‘speed to market’. It is undertaking rollout of new sites in the 16 telecom circles of India. Initially starting its operations in India, Indus Towers plans to seize opportunities arising from other parts of the globe. 2. Celluler Service Provider Vodafone Essar offers prepaid and postpaid GSM services in all 23 circles in India. In 2010, the company crossed the figure of 100 million subscribers. It is the second largest service provider in terms of revenue( behind Bharti Airtel.

VODAFONE: Role in the Industry
Vodafone Essar, ever since its inception, has played a role of a tough competitor for the market leaders and as a result it has found a place in the top three slots of the industry leaders both in terms of revenue and subscriber base. Vodafone Essar has been known for its innovative ad campaigns. It has often been praised for its award winning advertisements which all follow a clean, minimalist look. A recurrent theme is that its message Hello stands out visibly though it uses only white letters on red background. Another successful ad campaign in 2003 featured a pug named Cheeka following a boy around in unlikely places, with the tagline, Wherever you go, our network follows. It would not be surprising if Vodafone acquires the first position in Indian telecom space in near future. It has added 2.7 million subscribers in the month of June 2010. And is giving a tough competition to Bharti Airtel and Reliance. With its global experience in telecom market and partnership with Essar in Indian telecom market, Vodafone has the capability of capturing the untapped market in rural and semi-urban areas of India. The tough competition due to entry of new players in the market is going to be a big challenge for the company as the ARPU has been showing the downward trend.

Over the past three years, the company has invested over Rs. 20000 crore to expand operations and help serve the customers better. With a distribution reach of about 1.2 million outlets, the company is well geared to serve the customers in the remotest corner of the country(Voice and Data, June 2010). Vodafone Essar is known for quality value added services. The industry is watching for Vodafone’s 3G strategies. In 3G, it will be one of the leading players.

Present Market Condition
Some KEY figures (June 2010): • • •

Total mobile phone subscription is 635.51 Million. Mobile teledensity is 53.77% Subscriber base increased from 617.53 million in May 2010 to 635.51 million at the end of June 2010 registering a growth of 2.91%. Average Revenue Per User (ARPU) for GSM-Full Mobility service declined by 8.6%, from Rs. 144 in QE Dec-09 to Rs. 131 in QE Mar-10, with Y-O-Y decrease of 36.1%. ARPU for CDMA – Full mobility service declined by 7.4%, from Rs. Rs.82 in QE Dec-09 to Rs. 76 in QE Mar-10. ARPU for CDMA has declined by 22.9% on Y-O-Y basis. (


Market Size and Share
Group Company wise % market share Jun'2010 Sl. Name of Total Sub % Market No. Company Figures Share 1 Bharti Airtel 13,66,20,401 29.92% Vodafone 2 Essar 10,90,60,704 23.89% 3 4 5 6 7 8 9 10 11 12 IDEA BSNL Aircel Reliance Telecom Uninor MTNL Loop Mobile Videocon Stel Etisalat All India 6,88,86,539 6,68,87,839 4,16,79,575 1,63,11,206 60,23,655 49,02,380 29,26,797 19,42,364 13,26,506 18,196 45,65,86,162 15.09% 14.65% 9.13% 3.57% 1.32% 1.07% 0.64% 0.43% 0.29% 0.00% 100.00%

VODAFONE: Circle wise subscriber base(June 2010)
Andhra Pradesh Assam Bihar Delhi Gujrat Himachal Pradesh Haryana J&K Karnataka Kerala Kolkata M.P Maharashtra Mumbai North East Orissa Punjab Rajasthan Tamil Nadu U.P.(East) U.P.(West) West Bengal Total 63,32,518 9,43,880 37,91,641 55,61,512 1,14,96,133 2,14,339 31,09,554 2,78,416 55,11,044 44,47,067 37,15,365 21,11,656 78,10,838 52,70,404 5,87,657 12,20,184 32,91,478 77,93,520 95,14,086 1,12,00,654 70,00,654 78,58,104 10,90,60,70 4


Revenue wise Market Share(December 2009)

Recent Developments
• Vodafone’s revenues from Indian operations have increased 26.4% to £954 million (Rs 6,868 crore) in the first quarter of 2010-11, compared with £755 million (Rs 5,436 crore) in same quarter last year. In organic terms, revenue for the June has risen 13.7%, including a 1.5% benefit from Indus Towers, representing an improvement on the previous quarter. Vodafone has revised its agreement with Indian partner Essar and will additionally pay Rs 3,400 crore over and above the fair market value, if Essar exercises the put option for its 33% stake in the company. • In the recently concluded 3G spectrum auctions, Vodafone got the licence for 9 circles by paying Rs 11617 crore. The expected revenue it has defended is 68% and has covered 52% of the total market, focussing on high teledensity market.

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