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Page no. Acknowledgement Executive summary Introduction about Telecom Industry History Global Scenario National Scenario Demographic characteristic Market size, Trends & Players Telecom turn over/ Subscribers Opportunities /Competitive landscape Porters generic strategy Progress /Acquiring Subscribers Rural India Government Initiatives / MVAS VAS Mobile VAS in Rural Market Access Device /3G Handset Key trends in Telecom Industry Inhibitors MNP Implementation Globally Wimax Vs. 3G Mobile virtual network operator Regulation for MVN O / IPTV Companies overview 4P’s Analysis
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Advertisement Industry updates Major challenges for Mergers FDI Investment in Telecom sector Outsourcing by Telecom company Future Trends 4G Technology Conclusion/ References

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This project work would never have been an achievable task, had we not been under the great shelter of guidance of respected Professor Mukta Rae. Her simplified teaching technique based on examples has helped us gain more understanding of the subject. The very essence of the project work is the linguistic precision which has an impact of conveying more details in least possible words. An ample use of various reference readings has been very frequently made while compiling data for this project. Such rich reading has been made available at hand by the treasure-like well-maintained library of the IIPM, Ahmedabad. I am very much under obligation to mention here, the contributions of my batch mates who have, knowingly or unknowingly, provided me the competitive edge which is the driving force of the whole labor and extra labor put into the project. I would also take an opportunity to thank all the respondents, who have taken pains in answering the questions and filled the place of true representatives for deciding the nature of the problem. Finally, I feel very much gratified to the administration of IIPM, Ahmedabad for providing comfortable environment.

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JONTY MOHTA

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The rapid growth in Indian telecom industry has been contributing to India‟s GDP at large. Telecom Regulatory Authority of India was established to regulate and deal with competition among the service providers. Upcoming services like 3G and Portability will help to further increase the growth rate. The Indian telecommunication industry is one of the fastest growing in the world and India is expected to become the second largest telecom market in the world by 2010. India added 113.26 million new customers in 2008, the largest globally. The country‟s cellular base witnessed close to 50% growth in 2008, with an average 9.5 million customers added every month. It is estimated that telecom industry will generate revenues worth US$ 43 billion in 200910. IN this we have tried to capture the most of areas of telecom industry. Like, History of Telecom Industry, TRAI role and functions, new trends in industry and latest updates.

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To find the reason of tremendous growth in Indian Telecom Industry To study the role of TRAI To study upcoming trends in Telecom industry

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India growth story has already got the world to sit up and take a note of the changing economic scenario. have helped the sectors achieve the highs like never before. the flavor of the month seems to be the telecom industry. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 6 . Today. A local call costs around less then Rs. And currently.45000 and each call coasted Rs. Back then. The Indian government is doing everything that is possible to ensure that this story remains intact.50paisa/min and a cell phone can be purchased for less than Rs.50/minute. Jyoti Basu in culcutta called Sukh Ram in Delhi Sukh Ram in Delhi was the first mobile phone call in India. Factors.16.The exactly ten years ago. Brick sized cell phone used to cost Rs.1500. like the liberalization in the government stance and the daring entrepreneurs of the Indian soils. there are over 60 million mobile connections in India (expected to double in number in next 12 months.). cell phones was a status symbol.

History of Indian Telecommunications started in 1851 when the first operational land lines were laid by the government near Calcutta (seat of British power). TRAI was formed to act as a regulator to facilitate the growth of the telecom sector. Indian telecom industry has the highest growth rate in the world. In 1883 telephone services were merged with the postal system. two wholly government-owned companies were created: „Videsh Sanchar Nigam Limited‟ (VSNL) for international telecommunications & „Mahanagar Telephone Nigam Limited‟ (MTNL) for service in metropolitan areas. is the fastest growing telephone market in the world.9 Million new mobile phone subscribers were drawn by the Telecom sector in India in the month of August 2006. Indian Radio Telegraph Company (IRT) was formed in 1923. The government has reiterated the target of 500 million telecom subscribers and 20 million broadband connections by 2010. The first wind of reforms in telecommunications sector began to flow in 1980s when the private sector was allowed in telecommunications equipment manufacturing. After independence in 1947. In 1997. Telecom sector was considered as a strategic service and the government considered it best to bring under state's control. India.62 million in May 2008). National Telecom Policy (NTP) 1994 was the first attempt to give a comprehensive roadmap for the Indian telecommunications sector. In 1986. according to the COAI (Cellular Operators Association of India). In 1990s. New National Telecom Policy was adopted in 1999 and cellular services were also launched in the same year. Department of Telecommunications (DOT) was established. In 1985. telecommunications sector benefited from the general opening up of the economy. which is seeing over 8 million wireless subscribers being added every month (8. Telephone and Telegraph (PTT). A record 5. Telecom Regulatory Authority of India (TRAI) was created. a monopoly run by the government's Ministry of Communications. all the foreign telecommunication companies were nationalized to form the Posts. It was an exclusive provider of domestic and longdistance service that would be its own regulator (separate from the postal system). IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 7 .

the growth of cellular subscriber base has exceeded the fixed line subscriber base. Riding on expectations of overall high economic growth and consequent rising income levels. cellular penetration is still 1 per cent as compared to world average of around 16 per cent. However. India is the fourth largest telecom market in Asia after China.4 trillion in the year of 2009 when recession is everywhere. it offers an unprecedented opportunity for foreign investment. an increase of nearly 100 per cent in 2002. which has reached a level of 10 million users in December 2002. A combination of factors is driving growth in the telecom market. The expansion of the telecom industry in India has been fuelled by a massive growth in mobile phone users. by 2012. Example: TATA DOCOMO      It generated US $1. Japan and South Korea.  This exponential growth of mobile telephony can be attributed to the introduction of digital cellular technology and decrease in tariffs due to competitive pressures. Asia pacific region: expecting highest growth in next 5years. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 8 . The Indian telecom network is the eighth largest in the world and the second largest The Indian telecom market size of over US $ 8 billion is expected to increase three fold among emerging economies. For the first time in India.The Indian telecom market has been displaying sustained high growth rates. promising rich returns on investments.

Day by day. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 9 . MTNL. both the Public Players and the Private Players are putting in their resources and efforts to improve the telecommunication technology so as to give the maximum to their customers. Idea. VSNL in the fixed line and Airtel. Reliance in the mobile segment are coming up with new tariffs and discount schemes to gain the competitive advantage. The major players of the telecom sector are experiencing a fierce competition in both the segments. CDMA.  The Indian telecom sector can be broadly classified into Fixed Line Telephony and mobile telephony. Starting from telegraphic and telephonic systems in the 19th century.  The major players like BSNL. and WLL to the great 3G Technology in mobile phones. Vodafone (Hutch). like any other industrial sector in the country. Tata. the field of telephonic communication has now expanded to make use of advanced technologies like GSM.19% 12% 7% China India USA 62% Others Source: EIU (Economist Intelligence Unit) Indian Telecom sector. has gone through many phases of growth and diversification.

62m broadband Advanced Technologies – GSM.    The Public Players and the Private Players share the fixed line and the mobile segments. WLL.27 Million. CDMA.05m internet subscribers & 6. 3G and upcoming 4G Telecom sector Contribution of nearly 1% to India‟s GDP Currently the Public Players have more than 60% of the market share. Internet/Broadband subscribers are 14.  Future growth is likely to be concentrated in and around 60 to 70 large cities having a population of one million or more. This profile of concentrated urban population will IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 10 .55 Million and Rural subscribers increased to According to the Vision 2020 document of the Planning Commission of India.9 % of overall Tele-density.86 per cent. country will witness continued urbanization. Wire line Tele-density came in at mere 3. the 91. subscribers (June 2009) GSM •VODAFONE •AIRTEL •BSNL •IDEA •SPICE •AIRCELL •RELIANCE •TATA DOCCOMO •TATA INDICOM •VIDEOCON CDMA/WLL •BSNL •MTNL •TATA INDICOM •TATA DOCCOMO •VIRGIN MOBILE •RELIANCE •VIDEOCON Fixed LINE •BSNL •MTNL •BHARTI •TATA TELECOM •VODAFONE •RELIANCE     Total Tele-density stood at 39. The urban population is expected to rise from 28 per cent to 40 per cent of total population by 2020.22 % whereas wireless subscription contributed Subscription in Urban Areas was at 328. 136.

We have mobile 350 million subscribers. CDMA. long distance calls and the international calls. multimedia applications. with the provision of broadband services in the fixed line segment and GPRS in the mobile arena.5 million to strengthen Assam & Northeast Circles. applications like high storage memory. next to China Tata Teleservices – invest an additional US $ 1 billion in TATA DoCoMo BSNL – will put US $ 1.facilitate customized telecom offerings from operators. Both fixed line and mobile segments serve the basic needs of local calls. The GSM. along with other Internet surfing. services. Players. multimedia games. Traditional telephones have been replaced by the codeless and the wireless instruments.  The 2009 budget has brought further relief to the customers with the reduction in the SALES AND DISTRIBUTION Page 11 tariffs. and mobile commerce. This is likely to IIPM – AHMEDABAD . both local and long distance. etc. video generators.16 billion in WiMax Project Vodafone Essar – invest US $ 6 billion next 3 years to increase mobile subscriber base Bharti Airtel – US $ 126. MP3. The much-awaited 3G mobile technology has entered in the Indian telecom market. The value added services provided by the mobile service operators contribute more than 10% of the total revenue. and with slashing down the roaming rentals. Camera's. WLL service providers are all upgrading them to provide 3G mobile Radio services have also been incorporated in the mobile handsets.           Every month 8-10 million subscribers are adding in the market. Mobile phone providers have also come up with GPRS enabled multimedia messaging.

732. landline telephony is likely to remain popular.  However. previous quarter.52 Crores. in the foreseeable future.108.33 Crore and Adjusted Gross Revenue (AGR) GR has registered a decline of 3. if possible.82 325.79 225. increased slightly. such for telecom subscribers in general as this will allow further scope of reduction in telecom 464. :     tariffs. MTNL.43% in June-09 as against 8.4% in The less outgo in terms of licensing fees is a big positive for Telecom industry and as of Telecom Sector came in at Rs.53 104. has recently taken some bold initiatives to retain its market share and. the largest landline service provider. too.42 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Source: TRAI IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 12 . expand it.22 153. 29.01 76.lead to even more people going for cellular services and more and more use of the value added services. Gross Revenue (GR) stood at Rs 39.3% compared to previous quarter whereas AGR Average license fee as percentage of AGR was 8.

A host of factors are contributing to enlarged opportunities for growth and investment in telecom:     an expanding Indian economy with increased focus on the services sector population mix moving favourably towards a younger age profile urbanization with increasing incomes Investors can look to capture the gains of the Indian telecom boom and diversify their operations outside developed economies that are marked by saturated telecom markets and lower GDP growth rates.  Smaller companies can compete effectively only in small markets or by providing specialty services. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 13 . infrastructure vendors.India offers an unprecedented opportunity for telecom service operators. The profitability of individual companies depends on efficient operations and good marketing. and have the financial resources required building and maintaining a large network. manufacturers and associated services companies.  Demand is driven by technological innovation and by growth in business activity.  Large companies have big economies of scale in providing a highly automated service to large numbers of customers.

such as Toyota.  Financial considerations and budgetary constraints play a critical role here in shaping competitive price of the products.  Besides the production effiency. Overall Cost leadership strategy 2. Focus strategy  The Overall Cost leadership strategy is aimed at gaining a competitive advantage through lower costs. These strategies are:1. labor is recruited and trained to deliver the lowest possible costs of production. For example. generating a higher than average price. Factories are built and maintained. Differentiation strategy. 'cost advantage' is the focus.Porter has identified three types of generic strategies that help a firm to cope with competitive forces and outperform other firms in the industry. British Airways differentiates its service by providing focus on IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 14 . and 3. This allows companies to desensitize prices and focus on value that generates a comparatively higher price and a better margin. are very good not only at producing high quality autos at a low price.  The low cost leader in any market gains competitive advantage from being able to many to produce at the lowest cost.  A firm with a differentiation strategy attempts to achieve a competitive advantage by creating a product or service that is perceived as unique.  Differentiated goods and services satisfy the needs of customers through a sustainable competitive advantage. For example:--Some organizations. brand and marketing skills plays a important role in this kind of competition.  The benefits of differentiation require producers to segment markets in order to target goods and services at specific segments. but have the brand and marketing skills to use a premium pricing policy.

advantage. According to the CII Ernst & Young report titled 'India 2012: Telecom growth continues'. a niche strategy could be more suitable. telecommunications. or a differentiation focus.exceptional good quality of service rather than focusing on low price. With a differentiation focus a firm creates competitive advantage through differentiation There are potentially problems with the niche approach. Therefore there is always an incentive to innovated and continuously improve.g.      Here an organization focuses effort and resources on a narrow. These costs must be offset by the increase in revenue generated by sales. disappear in the long term. defined segment of a A niche strategy is often used by smaller firms. Small. In fact.    The differentiating organization will incur additional costs in creating their competitive There is also the chance that any differentiation could be copied by competitors. Where an organization can afford neither a wide scope cost neither leadership nor a wide scope differentiation strategy. as against US$ 31 billion in 2008 IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 15 . there is an enormous potential for various value-added services. revenue from India's telecom services industry is projected to reach US$ 54 billion in 2012. A company could use either a cost focus With a cost focus a firm aims at being the lowest cost producer in that niche or segment. Apart from the basic telephone service. Cost focus is unachievable with an industry depending upon economies of scale e.  The focus strategy is also known as a 'niche' strategy. Competitive advantage is generated specifically for the niche. the real potential for telecom service growth is still lying untapped. specialist niches could market. The target for the 11th Plan period (2007-12) is 600 million phone connections with an investment of US$ 73 billion.-- within the niche or segment.

Acquiring customers have always been a great challenge for companies. Therefore a lot of operators with adequate support from Government are eyeing the rural market for future growth. increasing subscriber base in urban market would be all the more challenging. In fact lucrative offers like being paid for incoming calls have transformed the scenario completely. Big operators like Airtel have claimed that soon mobile connections and recharge IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 16 . In order to capitalize this opportunity of meeting the consumer needs in highly competitive market the operators have reduced the tariffs to attract consumers with low purchasing power primarily in semi urban and rural India. Given the current level of saturation in Metros and Urban Market and cut throat competition among operators. This would result in further reduction of voice tariffs. This would lead to increased focus on MVAS by mobile operators.Source: COAI The progression chart below depicts the major regulations and events driving the extra ordinary growth of Telecom sector from year 1999 to 2008. Through these changing regulations and events. the Industry players are aiming to achieve the following   Acquiring new subscribers by expanding in Semi Urban and Rural India Selling more services to existing subscribers The recent TRAI recommendation permitting PC-to-phone calls where ISPs can offer cheaper STD calls and even free local calls.

Government also has supported the growth of this sector by coming out with a number of initiatives for the low end subscribers of rural India.  Decrease in ARPU despite increase in MOU: Though the subscriber base is growing at a rapid pace and has positively impacted industry revenues. This is relatively easier as compared to acquiring new customers.000 towers throughout the country to offer over 11 million mobile connections ADC was levied by Telecom Regulatory Authority of India (TRAI) in 2003 to provide support for BSNL's rural telephone obligation. In such a scenario mobile VAS sector is a potential longterm revenue stream as it will be easier to sell more to the existing customers. All the towers are expected to be erected and commissioned by December 2008. Telecom Regulatory Authority of India (TRAI) has recently given orders for the withdrawal of the ADC (Access Deficit Charge) and the subsequent passing of the benefit to the consumers by the telecom operators.  Number of Licensees: With increasing number of licensees (98 UASL. Also since now the new subscriptions will largely happen at the bottom of the pyramid therefore the new subscriptions will further lower the average revenue per user. and Universal Service Obligation (USO) fund was one such initiatives. operator margins also have shrunk owing to competition and lower “Average Revenue per User” (ARPU) as the major growth is coming from bottom of the pyramid. Under the second phase. the challenge is to develop alternative revenue streams and retain customers by creating a basis for differentiation in high-churn markets. BSNL and two private operators will erect 427 towers in remote areas offering over four lakh mobile connections. DoT aims at erecting 11. This certainly explains the future penetration of these services in remotest of villages. Thus the competition among the IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 17 . Need for differentiation: There is a greater need among the telecom operators to differentiate themselves from each other. and 37 cellular licenses) in the telecom space the average numbers of operators in many circles have increased to 5-6 operators offering more choices to the consumer. As ARPU declines and voice gets commoditized. The USO fund was an initiative taken up by the government to increase rural teledensity. In recent developments.vouchers etc will be available at all such places from where people buy match boxes.

But the fundamental question that remains is how VAS is defined.  Increasing need and demand from consumers: In addition to the above supply side reasons the „pull effect‟ from consumers asking for more than just basic telephony is also a key driver for MVAS services. Therefore it is very important for them to differentiate themselves from the others.1 per minute as compared to the tariff in developed nations like USA and UK where the call rates are Rs. Now that voice has got commoditized these operators are using MVAS for their differentiation and marketing these services heavily for creating awareness among the consumers. Telecommunication has moved beyond providing just basic voice calls. This is the reason why it is now being referred to as the „fourth screen‟.  3G bidders who are non-operators: The arrival of new technologies will give rise to greater competition as many non-operators are also bidding for the 3G licenses. The mobile phone has evolved from a mere communication device to an access mode with an ability to tap a plethora of information and services available in the ecosystem.  Saturation in Metro and Urban Market: The metro/urban areas offer high level of penetration and have significant mobile subscribers. A clear MVAS definition is not only required to clear the air among the MVAS providers but it will also have an impact on IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 18 . As we have seen.  Decreasing Call Rates: In order to attract consumers with relatively low purchasing powers primarily from Semi Urban and Rural India the operators have drastically reduced the call rates making it affordable to even the lower segment of society. Therefore capitalizing on value added services will give operators opportunity to increase ARPU by providing premium services. In such a highly saturated market with the entry of MVNO‟s the competition will get fierce. The tariff in India is one of the lowest at Rs.operators has increased tremendously. after Cinema halls. Today most of the consumers are seeking more from their communication device apart from just mobility and desire to stay connected. Department of Telecom  has planned to allow five 3G operators in each circle depending on the availability of spectrum. Television and PC.13 and Rs7-8 respectively. Therefore there would be a greater need to differentiate oneself in order to attract new customers and retain the existing ones.

The value added services are characterized as under:      Not a form of core or basic service but adds value in total service offering. basic services A value added service may demonstrate one or more of these characteristics and not necessarily all of them. May provide operational synergy with core or basic services. Rural IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 19 . In some cases. A classic example is of P2P SMS. For majority of the population in the rural segment.  Value Added Service (VAS) in telecommunication industry refers to non-core services. Do not cannibalize core or basic service. Some of the operators do not consider P2P SMS as part of their VAS revenue. Can be add-on to core or basic service and as such can be sold at premium price. the value added service becomes so closely integrated with the basic offering that neither the user nor the provider acknowledge or realize the difference. Stands alone in terms of profitability and also stimulates incremental demand for core or Can sometimes be provided as standalone. the mobile phone is the first communication device. The Government of India issues licenses for the following Value Added Services:       Public mobile trunking service Voice mail service Closed users group domestic 64 kbps data network via INSAT satellites system Videotex service GMPCS Internet Audiotex Unified messaging service The next wave of Telecom growth will come from the bottom of the pyramid. A detailed definition of VAS might have an impact on the licensing issues surrounding VAS.the dynamics of the Value chain. the core or basic services being standard voice calls and fax transmission including bearer services. Let‟s look at different VAS definitions floating in the market.

job opportunities etc are potential areas. finance. But whether the statement can be extended to MVAS depends on some key factors. Literacy level of the geographical area will be another limitation. mandi rates. Providing cheap access mode to end consumer would be another key booster to rural MVAS. Health. to provide an easy and cheap access mode to the rural consumers. weather.should not always be interpreted as poor and therefore some categories of MVAS might apply directly to them. All these 3 are quite big challenges and therefore needs to be addressed adequately for MVAS to take off in Rural India. etc. communication of these services to the rural population would be a bigger challenge. One way to do this is to communicate through regional SMS for which a separate SMS gateway needs to be installed.connectivity and entertainment mode. Marketing the content in rural market is going to be all the more challenging. the „sachet model‟ could prove to be successful here. Therefore the better communication option is Voice in regional languages. generate awareness and thirdly.g. MVAS is going to address two main needs of rural consumers. One is to clearly identify the need of the rural segment. The industry has witnessed some type of content being downloaded more in small towns of UP and Bihar rather than in metros like Delhi and Mumbai. This would require right packaging and pricing of MVAS. Therefore by leveraging on these two aspects MVAS can be a success in rural area. Current voice MVAS charges are expensive from a rural consumer perspective therefore that also would need to be addressed for e. second is to communicate the services to them i.e.g. GPRS Handsets IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 20 . Apart from the identification of rural consumer needs and development of relevant content. Mobile also has the potential to evolve as a key entertainment mode considering lack of other entertainment options in rural areas. Connectivity will provide Information VAS on Agriculture necessary for the farmer‟s livelihood e. The challenge with regional voice is not only investment but also blockage of the already scarce spectrum.

The market for 3G in the country is expected to be huge with over 65 million wireless subscribers. GPRS Activated 15-16 Mn. Of all those who possess GPRS enabled handsets only 20-25% of them have got the GPRS activated and only about 15% use it. Of the total mobile subscribers in India 65 million possess GPRS-enabled handsets. These subscribers are currently using mobile handsets which are internet-enabled and are potential broadband IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 21 .Currently the penetration of GPRS enabled handsets are close to 26% in India as against 99% in South Korea and 76% in Japan. Population of india 1130mn Mobile subscriber base 426Mn GPRS Enable 65 Mn. Even in case of developed nations like South Korea and Japan not more than 50% of the subscribers owning GPRS enabled handsets use it. Therefore for MVAS to grow to its full potential the handset manufacturers will have to look at ways to manufacture GPRS enabled phones which are affordable and user friendly. who use their handsets to access data services on the Web.E Technology This clearly indicates that the consumer today engage more in text based services than the web based applications. Moreover they would also need to increase its awareness and educate the consumers on how to use GPRS. GPRS USERS 9Mn Source: TRAI REPORT.

directory assistance. Given that mobile phones are much cheaper as compared to PCs. Virtually all of wireless carriers’ systems are affected. order activation. Unlike most other countries. More importantly. maintenance and CSC systems. Since our broadband penetration is abysmal. stationery. Examples of critical systems and processes that would be affected are: billing. family and business contacts that their wireless number is changing. home location registers (HLRs)." Why mobile number portability (MNP)? When fully implemented nationwide by both wire line and wireless providers. From the wireless carrier’s perspective the change is anything. thereby ensuring better services in all respects. and visiting location registers (VLRs). IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 22 . Therefore the shift towards 3G would depend on affordability of handsets along with the quality of content available. 3G would provide a much required boost to it. roamer registration and support. 3G will solve problems more in rural India. customer service. the demand for broadband on mobile is expected to be much greater. In short. because they can change wireless service providers without worrying about notifying friends. call delivery. and or locations. Especially any system that relies on mobile identity numbers (MINs) or mobile directory numbers (MDNs) will be affected. short messages service center. but simple. calling name presentation. this is a deceptively simple and very welcome change. being able to ‘port’ a number from one provider to another eliminates the hassle and expenses of changing business cards. invoices and other materials for businesses. we are looking at 3G services not only as premium services but also as an extension of 2G. In addition. In addition. switches. portability will remove one of the most significant deterrents to changing service. service types. caller ID. According to Indian Cellular Association (ICA) about 5% of mobile users already have handsets that can work on 3G spectrum.subscribers with the deployment of advanced wireless technologies such as 3G. providing unprecedented convenience for consumers and encouraging unrestrained competition in the telecommunications industry. From the subscribers’ perspective. out of all those possessing the 3G enabled handsets the number of people who would use 3G services would be determined by the quality of content available. this is the best method to increase the efficiency of the service provider by increasing the competition. One of the most frequent definitions that prevail in the telecom circles for number portability is: "Number portability is a circuit-switch telecommunications network feature that enables end users to retain their telephone numbers when changing service providers.

The cost estimate for the implementation of WNP in developed nations like the US can be very helpful for the other countries. based on the cost factor. Referring to the recent example of the US. Infrastructure Upgrade: To support WNP. i. It‟s like a blessing in disguise for the customers. The provider. Off late. followed by Hong Kong in 1999 and Australia in 2001. from their respective governments. within any country. has been the implementation cost. Globally. a company has to upgrade both its hardware and software capabilities. Service Providers have been constantly bargaining for time. Softwares need to be upgraded to provide proper routing of calls. To add on increased marketing costs are to be realized as the carriers look to lock up their current base before number portability is implemented. The carriers need to upgrade their networks to handle portability requests.. albeit with the same number. which they need to recover before the subscriber moves to the new service provider (NSP). which has its portability compatible would be expected to attract maximum customers and will emerge the winner. The FCC on this plea gave wireless carriers in the US another year. and then aggressively pursue the customers of other carriers thereafter. Singapore was the first country to implement MNP in 1997. many countries have adopted the MNP model to prevent IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 23 . The experience of developed countries exhibits that local number portability for fixed wireline was introduced within two to three years of introduction of competition to incumbent state telcos.e. as they would get better service irrespective of the carrier. which will amount to some cost. till November 2003. who wish to think on the lines of number portability. for resolving implementation issues. : Every subscriber in a race to retain its customer would like to offer its customers best services so as to save them from porting. the old service provider (OSP) has to perform a query to identify if there are any billing amounts pending. where each of the large carriers would need to spend $50–60 million to institute the service and an equivalent sum to maintain it. Cost Recovery and Bill Reconciliation/Query Processing: When a customer plans to shift.: One of the most common barriers in MNP implementation.

among others. The technology is available as IEEE 802. Germany. While opponents of WiMax say currently it cannot be used for mobile applications.market doldrums and putting pressure on service providers to furnish more services at a competitive price level. the regulator effectively promoted number portability and was able to maintain the maximum porting time of just under three hours. Some companies have commercially launched fixed WiMax services in certain cities. MNP worked in Hong Kong due to the speedy porting process and the availability of already implemented solution (for fixedline services). With the Department of Telecommunications gearing up for simultaneous release of 3G and WiMax spectrum. where initially the implementation was viewed as a success due to dearth of minimal contract periods and high migration incentives. It offers downloads of up to 70 Mbps as compared to the 15 Mbps that 3G provides. operators failed to sustain the momentum. In India. Bharti Airtel and Reliance Communications are the proponents of WiMax. it failed to bear fruit in the UK. overboard of paperwork. Malta.16D (fixed) and IEEE 802. Fortunes will be made and lost in this battle. The WiMAX vs. telecom service providers are in various stages of WiMax implementation. analysts expect the two emerging wireless technologies to battle it out for supremacy. Intel. Furthermore. Bharat Sanchar Nigam Ltd. Most of the companies have had betaruns of the technology. in Finland. technical difficulties and poor customer service. 3G cellular showdown is poised to become one of the next great market battles in the telecom industry. it has not been able to produce any significant results in these markets. and the user experience of the Internet will be irreversibly changed in the process. Ireland.16E (mobile). Pakistan. In Australia. Another reason for the industry pinning its hopes on WiMax is its ability to increase the broadband penetration. While it has worked in markets like Hong Kong and Australia. WiMax makes huge sense for companies as it enables them to provide cheaper mobile internet and broadband IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 24 . France. Wimax may lead to increased broadband penetration. According to a top official with a service provider. However. The failure in most markets where MNP was implemented is attributed to factors like halfhearted implementation. companies like Tata Communications Internet Services. 3G scores for voice. the first mobile WiMax network was introduced in Italy this July. Mobile WiMax offers download speeds of around 20 Mbps. lack of consumer awareness. WiMax or Worldwide Interoperability for Microwave Access is a telecom technology that enables wireless transmission of data. issues related to contract.

Slowly MVNO phenomenon catching up in Asia and other parts of the world also. An example for MVNO is Virgin Mobile. The Telecom Regulatory Authority of India has set a target of 20 million broadband connections by 2010 from the current 4. using regular telecom operator's network with which they have a business arrangements. in turn. The WiMax customer premise equipment (CPE) is priced at Rs 5. The industry will know the winner in the next six months. while the CPEs for 3G would be cost Rs 10.000-10. and the US. Patel added. even though they might stick with 3G or 2G spectrum for voice. Operators will have to use 3G spectrum to revive voice services that are being choked by a dearth of 2G spectrum. Currently MVNOs are emerging in fast pace in European markets and beginning in USA also.3 million. Virgin Mobile plc is a mobile phone service provider operating in the UK. The industry expects WiMax to bridge the gap. as providing the last mile over the conventional digital subscriber lines would be time-consuming and costly.000. increasing the internet penetration.000 and above. According to a consultant of Ernst & Young service providers would mainly use the technology for gaining traction with the customers. Mobile Virtual Network Operator (MVNO) is a GSM phenomenon where an operator or company which does not own a licensed spectrum and generally with out own networking infrastructure. this will adversely impact services like GPRS and e-mail on mobile as users might move over to WiMax-enabled devices for data. However. when the spectrum allocation is complete. Australia and Canada.services. Usually they they buy minutes of use from the licensed telecom operator and then resell minutes of usage to their customers of MVNO. The company was the world's first IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 25 . Instead MVNOs resell wireless services under their brand name.

another weather and traffic and still another could provide instant messaging capabilities. The ITU has received several requests to study the issue. In Australia. In the UK. launched in the UK in 1999. and instead has contracts to use the existing network(s) of other providers. it uses the Bell Mobility network. In this way. and customer care operations. marketing. So far MVNOs have not been regulated in any country. Virgin Mobile uses the T-Mobile network. MVNO's have full control over the SIM card. Some MVNO's deploy their own mobile Intelligent Network (IN) infrastructure in order to facilitate the means to offer value-added services. These networks use different technology (GSM in the UK and Australia and CDMA in the US and Canada). Usually MVNO's do not have their own infrastructure. This would IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 26 . the incumbent mobile operators most keep their own OSS/BSS processes and procedures separate and distinct from those of the MVNO. It does not maintain its own network. Virgin Mobile operates on the Optus network. One MVNO could provide sports news. some providers are actually deploying their own Mobile Switching Centers (MSC) and even Service Control Points (SCP) in some cases. billing. MNVO's can treat incumbent infrastructure such as radio equipment as a commodity. In the US. specifically to provide input on whether government intervention is necessary to allow MVNOs to offer services and applications at a lower price to consumers. while the MVNO offers its own advanced and differentiated services based on exploitation of their own IN infrastructure. allowing for customer acquisition and preventing the MVNO from needing to compete on the basis of price alone. In the future a cell phone user may be able to subscribe to a network operator plus multiple MVNOs for specific data services over the same phone.Mobile Virtual Network Operator. branding. The goal of offering value-added services is to differentiate versus the incumbent mobile operator. While sometimes offering operational support systems (OSS) and business support systems (BSS) to support the MVNO. In Canada. the Sprint network is the carrier. In this way. each MVNO and the network operator could focus on their own niche markets and form customized detailed services that would expand their customer reach and brand.

with providers in many countries including Japan. If you IPTV is packaged with digital phone. Caller ID might pop up on screen as your telephone rings. One application might be in game shows in which the studio audience is asked to participate by helping a contestant choose between answers. such as a touchdown. telephone companies are in a prime position to offer IPTV services initially." IPTV even allows for picture-in-picture viewing without the need for multiple tuners. reportedly purchased a software delivery system for IPTV services from Microsoft in 2004 IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 27 . IPTV opens the door to real-time participation from people watching at home. a subscriber might even utilize remote programming for IPTV. voice over IP (VOIP) or digital phone. it also adds many advantages that may play into market pricing. However. Italy. One of the advantages of IPTV is the ability for digital video recorders (DVRs) to record multiple broadcasts at once. collectively referred to as Triple Play. France. you don't have to miss your favorite program. and therefore theoretically reduced prices to operators and subscribers alike. and offers key advantages over existing TV cable and satellite technologies. Spain. Hong Kong. Just call home and remotely set the IPTV box to record it. It requires a subscription and IPTV set-top box. and watch it from dual angles simultaneously using picture-in-picture viewing. and the United Kingdom. Because IPTV arrives over telephone lines. IPTV (Internet Protocol Television) delivers television programming to households via a broadband connection using Internet protocols. Another application would be the ability to turn on multiple angles of an event. it will also be easier to find favorite programs by using "custom view guides. fast-forward. the real advantage of IPTV is that it uses Internet protocols to provide two-way communication for interactive television. IPTV is already growing in the international market. and Web access. but it is expected that other carriers will offer the technology in the future.help to ensure a more efficient use of the spectrum but some incumbent providers argue that the market is already competitive and intervention is not necessary. Using a cell phone or PDA. one leading provider. while using picture-in-picture to channel surf! IPTV viewers will have full control over functionality such as rewind. You can watch one show. One can also receive Web service notifications while watching IPTV for things such as incoming email and instant messages. For example. pause. In the United States SBC. However. and so on. IPTV is typically bundled with other services like Video on Demand (VOD). if a dinner function runs longer than expected. IPTV promises more efficient streaming than present technologies. According to Alcatel. Ireland.

services in India. 2009.Mobile services. of whom 102. Airtel was voted as the „Best Cellular Service‟ in the country for four consecutive years.for $400 million dollars. Airtel comes to you from Bharti Airtel Limited. Bharti Infratel owns 42% of Indus Towers Limited. services and Enterprise services.762 customers as of June 30. owns and manages passive infrastructure pertaining to telecom operations under its subsidiary Bharti Infratel Limited. Telemedia The mobile business provides mobile & fixed wireless services using GSM technology. Alcatel is working with Microsoft to develop a "global solution" for IPTV services.367.195.  The company also deploys.       Bharti Infratel and Indus Towers are the two top providers of passive infrastructure Telecom giant Bharti Airtel is the flagship company of Bharti Enterprises. private telecom services provider with a footprint in all the 23 telecom circles. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 28 .881 subscribe to their GSM services and 2. India‟s largest integrated and the first Bharti Airtel is structured into three strategic business units . They served an aggregate of 105. and Verizon has also made a deal with Microsoft for IPTV software.827. Bharti Airtel is one of Asia‟s leading providers of telecommunication services with presence in all the 22 licensed jurisdictions (also known as Telecom Circles) in India.  They also offer an integrated suite of telecom solutions to their enterprise customers. They have launched DTH and IPTV Services also. in addition to providing long distance connectivity both nationally and internationally.881 use Telemedia Services either for voice and/or broadband access delivered through DSL. All these services are rendered under a unified brand “Airtel”. and in Srilanka.

Leading Competitors.Vidhya Balan. Targeted by top talent.in Shahrukh Khan.280 as at June 30. Madhvan. RELIANCE.Rahman. TATA. BSNL.VODAFONE.Sachin Tendulkar.    Loved by more customers. IDEA. India Sunil Mittal Telecom Mobile and Fixed-Line Telecommunication operator.airtel. Mumbai (BSE) The National Stock Exchange of India Limited (NSE) 1985 New Delhi.A. Airtel DTH $6 Billion Express Yourself www. Founded Headquarters Key people Industry Products Revenue Slogan Website Brand Ambassador Saifali Khan. AIRCEL IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 29 . 2009 Company Vision: By 2010 Airtel will be the most admired brand in India. Benchmarked by more businesses.Anandi (Avika guar) Balika vadhu.898.R. Karina Kapoor.Type The Stock Exchange. Shares in Issue: 1.373.

United Kingdom.Vodafone is a British multinational mobile network operator headquartered in Newbury. based on revenue. and has a market value of about £71. If the consumer is after or comes for particular product and why.2 billion (November 2009). Vodafone is a public limited company with listings on the London and New York stock exchanges. The business operates in 26 countries worldwide. Quality of the product. However.000 staff and with over 130 million customers. employing over 65. Vodafone is the world's largest mobile telecommunication network company. either because of effective advertisement on the media like television or news papers or other means of IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 30 . Global recognition of the Vodafone brand is growing as the company rolls out its identity into new markets. Basically our objectives were to find out the behaviors of the consumers or the customers towards the product available in the market that either consumer or the customer is after the     advertisement. Vodafone uses leading sports stars from high profile global sports. including David Beckham and Michael Schumacher. After the price of the product. it retains local names and imagery in markets where this is essential to maintaining the trust of customers. This Case Study concentrates on how such promotion can help to keep a leading brand at the forefront of public awareness For that reason our team decided to work on few steps which were basically to get the feed back from the market as fallow. Vodafone is the world's largest mobile telecommunications community. To help promote its image worldwide. After the good presentation of the product which includes the servicing.

Chairman John Buchanan. Zoo zoos IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 31 .vodafone. independent 1991 Newbury.LOGO: Founded Headquarters 1983 as Racal Telecom. Revenue Net income Slogan Website Main Attractions of advertisement ▲ £31. UK Arun Sarin. CFO Industry Mobile telecommunications Products Mobile networks.564 billion GBP (2007) Happy to help www. England.104 billion GBP (2007) ▼ £-1. Etc.com Dog. Deputy Chairman Andy Halford. CEO Key people Sir John Bond. Telecom services.

Madhya Pradesh. Idea Cellular won the GSM Association Award for "Best Billing and Customer Care Solution" for 2 consecutive years. the acquisition of Escotel in 2004 gave Idea a truly pan-India presence covering Maharashtra. Delhi (inclusive of NCR) and West Bengal. It also offers GPRS services in urban areas. Andhra Pradesh. Haryana.Idea Cellular is a wireless telephony company operating in all the 22 telecom circles in India. Gujarat. Listed on BSE IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 32 . Rajasthan. Rajasthan and Tata Cellular as well as Birla AT&T Communications. It initially started in 1995 as a joint venture among the Tatas. Uttar Pradesh (UP) West. The company has also been the first to offer flexible tariff plans for prepaid customers. Type Spice: Public. Goa. The company has its retail outlets under the "Idea n' U" banner. Initially having a very limited footprint in the GSM arena. Chhattisgarh. Aditya Birla Group and AT&T by merging "'Wings Cellular'" operating in Madhya Pradesh. Uttar Pradesh (East and West). Kerala.

ideacellular.Idea: Subsidiary Spice: 1997 Founded Idea: 1995 Spice: Mohali. Pune.com Brand Ambassador Abhishek Bachan Revenue RELIANCE OVERVIEW IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 33 . Spice: Spice Telecom . India Spice: Dilip Modi Key people Idea: Chairman: Kumar Mangalam Birla . India Headquarters Idea: Indore. MD: Sanjeev Aga Industry Products Telecom Mobile operator http://www.) Slogan Idea: An !dea can change your life.com/india/news/business/idea-cellularsrevenue479-/394751 Spice: Spice Hai toh life hai (If there's Spice then there's Life.moneycontrol. Delhi. Website Idea: www.

known as "Big TV".77 per cent of the company. along with Reliance Telecom and Flag Telecom. the company announced it is buying US-based managed Ethernet and application delivery services company Yipes Enterprise Services for a cash amount of Rs.PIYUSH. formerly known as Reliance Info comm. comprising of power (Reliance Energy). ACQUISITIONS In July 2007. It uses CDMA2000 1x technology for its existing CDMA mobile services. RelCom is also into Wire line Business throughout India and has the largest optical fiber communication (OFC) backbone architecture [roughly 110.[3] It is the flagship company of the Reliance-Anil Dhirubhai Ambani Group. The deal was announc overseas acquisition.000 km] in the country. Type Public (BSE: RCOM) IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 34 . Reliance Communications has launched its Direct To Home (DTH) TV also.Reliance Communications. which had been led by its CEO at the time Mr. Reliance Communications had bid for 67% of Hutch but lost to Vodafone. According to National Stock Exchange data. and GSM-900/GSM-1800 technology for its existing/newly launched GSM services. BID FOR HUTCH: In 2007. which accounts for more than 1. financial services (Reliance Capital) and telecom initiatives of the Reliance ADAG.36 billion shares. RelCom have presence across all B2C communications channel in one of the fastest growing markets in the world. the Reliance group has amalgamated the United States-based Flag Telecom for $ 211 million [roughly Rs 950 crore (Rs 9. 1200 crore rupees (equivalent of USD 300 million). It is an Indian telecommunications company.50 billion)].P. is part of Reliance Communications Ventures. Anil Dhirubhai Ambani controls 66.

Maharashtra.26 billion (2008) US$ 1.Founded Headquarters Key people 2004 Navi Mumbai.31 billion (2008) 33.000 Hritik Roshan TATA: AN OVERVIEW IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 35 . India Anil (Chairman) & Vice-Chairman Reliance-ADA Group Ambani (MD) Industry Products Telecommunications Wireless Telephone Internet Television Revenue Net income Total assets Employees Brand ambassador US$ 4.35 billion (2008) US$ 19.

38 billion). and went on to become the premier provider of international voice and data services.[1] In Feb 2008. It is today part of the Tata Group. In Nov 2008.Tata Comm. It started as a successor to the erstwhile Overseas Communication Services.269 crore ($10. Japanese telecom giant NTT Docomo picked up a 26 per cent equity stake in Tata Teleservices for about Rs 13. It operates under the brand name Tata Indicom in various telecom circles of India. is India's leading international telecom service provider.070 crore ($2. TTSL announced that it would provide CDMA mobile services targeted towards the youth. Tata Teleservices Provides mobile services under 3 Brand names:    Tata Indicom Tata DoCoMo Virgin Mobile Tata Teleservices Limited (TTSL) IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 36 . Tata Teleservices Limited (TTSL) is a part of the Tata Group of companies. in association with the Virgin Group on a Franchisee model basis.7 billion) or an enterprise value of Rs 50. an Indian conglomerate.

Tata Key people (Chairman) Anil Kumar Sardana (MD) Industry Telecommunications Wireless Products Telephone Internet Television Employees 350.Type Private Founded 2000 Headquarters Navi Mumbai.000 Parent Tata Group IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 37 . Ratan N. India Mr.

2008. Currently has a customer base of 90 million as of June 2008. 4. BSNL's earnings for the Financial Year ending March 31.15b (US$ 9. 24% market share as on March 31.67 b) with net profit of INR 78. BSNL is India's oldest and largest Communication Service Provider (CSP).55 million Wire line.21 million GSM Mobile subscribers. 2007 stood at INR 397. It has the status of Mini Ratna. 2008 BSNL commanded a customer base of 31. The company is planning an IPO within 6 months to offload 10% to public in the Rs 300-400 range valuing the company at over $100 billion.90 billion). Harish Chandra Mathur Lane. It is India's largest telecommunication company with. Its headquarters are at Bharat Sanchar Bhawan.BSNL OVERVIEW Bharat Sanchar Nigam Limited (known as BSNL) is a public sector telecommunication company in India. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 38 . a status assigned to reputed public sector companies in India. It has footprints throughout India except for the metropolitan cities of Mumbai and New Delhi which are managed by MTNL. Janpath.58 million CDMAWLL and 54. BSNL has an estimated market value of $ 100 Billion.06b (US$ 1. New Delhi. As mon March 31.

Harish Chandra Mathur Lane. New Delhi Key people Kuldeep (CMD) Goyal Industry Telecommunications Wireless Products Telephone Internet Television Revenue US$ 9. incorporated 2000 Headquarters Bharat Sanchar Bhawan. Janpath.67 billion (2007) Owner(s) The Government of India IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 39 .Founded 19th century.

Type Industry Founded Headquarters Joint Venture Telecommunications 2009 Gurgaon.in Parent Website IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 40 .75%) Uninor.000 Telenor (67. India Stein-Erik Vellan Key people (CEO) Sanjay Chandra (Chairman) Wireless Products Telephone Internet Employees 2.25%) Unitech Group (32.

India Key people Venugopal Dhoot (Chairman) K. R. Kim (CEO) Products Consumer Electronics Home Appliances Components Office Automation Mobile phones Wireless Internet Petroleum Satellite television Power Revenue ▲ US$4 billion (2010) Net income ▲ US$276 million (2010) Employees 5.Type Public (BSE: 511389) Industry Conglomerate Founded 1979 Founder(s) Nandlal Madhavlal Dhoot Headquarters Aurangabad.000 (2010) Website Videocon.com IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 41 . Maharashtra.

But the thing that differentiate it from the competitors that it provide Study clearly shows that Vodafone is a has a brand image in the mind of public due to their willingness to provide the best service. Handsets for CDMA Price.    Latest advertisement of Vodafone: Zoo zoos” is very attracting and it increases the sales of the Vodafone . Plug to surf devices. Home.FOUR P‟S ARE:1) PRODUCT 2) PRICE 3) PLACE 4) PROMOTION    Product. Outdoor media. Electronic media. Institutions The study shows it clearly that Vodafone have a huge market share due to its the more and more number of the value added services. Sales promotion  Place: Every retail shop. Schemes Promotion: Print media. Offices.Offers. the marketing manager of Vodafone reveals that statement. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 42 . better service and good network.Sim cards.

Recently Vodafone gave its whole concentration by a series of advertisements of ZOOZOO series. which is also its Youth icons like Shahrukh khan and Sachin Tendulakar were brought in as brand Add campaign with an eye on the rural market current tagline.Vodafone focused more and more on the value added service and marketing.Rehman and changed its tune to "live every moment": rah man’s signature tune for Airtel is the most downloaded ringbone in India.    The following year Airtel adopted the "express yourself" positioning. ambassadors to attract youngsters IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 43 . This move of Vodafone proved very successful to attract the more and more number of the customers .R.      Airtel basically uses two appeal to connect to the users Emotional Humorous attracting In 2002. But that was just part of the ongoing communication. Airtel signed on music composer A.

Attracting the Youth:-. Add some other promotional offers. Telecom market is quite competitive so mobile service providers should provide the Mobile service providers should focus on providing better network coverage Especially Mobile service providers should provide various schemes for their existing customers. BSNL have to make more attractive ads. Mobile service providers should provide the web access at cheaper cost. IIPM – AHMEDABAD .To attract more youth community Airtel can go for more and more plans for youth under the same brand “SABKA AIRTEL”. cheaper call rates schemes only for school and college going students. Vijendra is having good looking personality and he belongs to rural area so in this way rural people will start associating themselves with that brand “SABKA AIRTEL”. But organizations can further use recent bronze medallist Boxer Vijendra kumar as there endorsement.The whole advertisement and promotion is designed by taking urban youth in focus but there are large no of youths in rural sector as well and they can be their future consumers. In this plan Airtel should go for the heavy youth promo with fast dance track and cute guys and gals.       Mobile service providers should provide the facility of portability of number.     BSNL. clearly shows that youth can play a major role in this competition. Makes some sense full ads for Tata Doccomo For making interactive add to connect with customers. In this plan Airtel can give SMS pack (it‟s for SMS generation). Airtel can also use BALIKA VADHU fame “ANANDI” (Avika gaur) targeting rural women and rural youth Youth to Drive Growth:--Airtel should more concentrate towards the youth. Taking big stars as brand ambassador is good decision. Consolidation in Industry. SALES AND DISTRIBUTION Page 44 services at cheaper cost. As the increasing market share of rivalry brand Virgin.

acquisition of shares of Spice.Telecom players are looking to tap into global funds to finance their aggressive growth plans. So it was a win-win deal for both companies. HTIL declared a special dividend of 6. Small players like Spice Telecom operating at only a few circles(Karnataka and Punjab) will find difficult to compete with the nationwide players in the long run. The industry may see consolidation with these smaller operators being acquired by the larger ones.8% stake of Spice Communications at Rs 77. The deal gave them access to one of the fastest growing mobile markets in the world. New policies will seek to curb this license arbitrage. 3G and WiMax license will spur M&A and partnership activity. This will result in partnerships joint ventures and equity sellout to foreign players.  Telenor-Unitech Deal IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 45 . Smaller players with operations in only a few circles will find in difficult to compete with the nationwide players.30 a share for Rs 2. New license holders will continue to look to sell their stake at a premium. Idea acquired 40.  Idea Cellular’s Acquisition of Spice Telecom There were three transactions as part of this acquisition.9 billion in cash for acquiring the 52% stake held by Hutchison Telecom International (HTIL) in Indian mobile firm Hutch-Essar. The deal was strategically important for Idea Cellular as it was looking forward to transfer itself into a pan-India telecom service provider.716 crore. With respect to shares. a noncompete fee and a capital infusion of about Rs 7300 crores received from TM International Bhd (TMI).08 billion. An additional Rs 544 crore was paid to the promoters of Spice group as 'non-compete fee'. There was a share swap in which Spice shareholders got 49 Idea shares for every 100 Spice shares held. “Unbundling of the corporation” will continue as companies will seek f or economies of scale and lower startup cost by infrastructure sharing.75 HK dollars per share following the completion of the formalities. The spectrum auctioned by GoI is a scarce resource nowadays and cost a premium. The final price was a reduction of $180 million from the originally agreed price of $11. Also there‟s restriction by TRAI with respect to number of operators per telecom circle.  VODAFONE’S ENTRY INTO INDIA Vodafone paid a discounted price of $10. So it makes sense to acquire a small telecom operator. Vodafone is the largest mobile telecommunications network company in the world.

It has been less prepared to take majority stakes and impose its will. The two companies will not overlap in each other‟s business operations: Bharti Airtel will be the primary vehicle for Bharti and MTN to pursue further expansion in Africa and the Middle East. value-added services. The enterprise valuation of Unitech Wirelsss is about Rs 10. Recently Bharti Airtel has re-started its audacious merger bid with MTN that could create a $61billion transnational telecom goliath with combined revenues of $20 billion and over 200 million subscribers across Africa. Meanwhile. but they are also falling fast. including procurement. Asia and Middle East. DoCoMo had said “participating proactively in TTSL‟s management by providing human resources and technical assistance to help realise improved network quality and the possible introduction of leadingedge.Norwegian Telecom major Telenor is in the process of acquiring controlling stake of 67. operational best practice.  Strategic benefits to both players Synergies would be sought from a number of areas. will be among the world's 10 biggest telecom companies. DoCoMo‟s international expansion plans have not always proven successful. they got 33. Telenor will infuse cash in four stages and at each phase.130 crore for a further 15. as other leading carriers have chosen to do. As per the deal. In the first phase.5% ownership in Unitech Wireless. The Tata DoCoMo-branded GSM service has already started in Southern India and gradually will be expanded nationwide.  TTSL – DoCoMo Deal. Japanese carrier NTT DoCoMo acquired 26 per cent stake in Tata Teleservices (TTSL).25% in Unitech wireless via equity infusion. The difficulties faced by the firm in spreading its domestically successful i-mode service internationally typify the obstacles it has faced overseas.”  Bharti-MTN deal (in talks). MTN may have higher ARPUs (in the range of $12-20). the African telecom operator is also encountering some of the problems that its counterpart in India is confronting. Bharti is under pressure in its home country due to severe competition and looking forward to spread its risk across geographies.5 per cent stake in the company. With Tata. In the second phase they completed the acquisition for a 49 per cent stake in Unitech Wireless by paying Rs 1.900 crore. with the firm historically preferring to take small stakes in firms and then try to influence their strategy. The acquisition is expected to be completed by end of this quarter. The deal could be win-win for both parties. by increasing its stake in Unitech Wireless. R&D and international network sharing. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 46 .

Bharti could be on a sticky wicket. The Indian telco does not have the expertise in running multi-country operations. Besides. The most important. and visible fallout of the deal. if it materializes. but it would also have a say while making bigger strategic decisions. it would be imperative for them to incrementally expand into untapped areas. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 47 .  Takeaways for Bharti The biggest takeaway for Bharti is in the form of access to new geographies with high growth potential. even if the company places an order worth just $1 million.With both Bharti and MTN operating in high-growth geographies. which calls for more collaboration if corporate intend to expand. This offers plenty of room for expansion. The fact that 95 percent of Africa is prepaid. The high subscriber base and financial muscle will give Bharti-MTN the desired edge while dealing with vendors. For instance. Once the merger happens. Of late. without local knowledge (with respect to the market and government regulations). there is a lot of potential in Africa as three-fourths of the continent is still untapped. companies are finding it tough to obtain easy funds for expansion. MTN‟s strong foothold in some growing markets such as South Africa. The options for Bharti were to go either the Greenfield way or with an experienced partner. Bharti would be ready to take off in other geographies. the vendor would not hesitate to lap it up. which would be time-consuming and capital intensive. which ensures all cash operations. In recent times. This would offset whatever concerns there may be with respect to the small population size in countries where MTN operates. Iran and Nigeria ensures that when the growth in India starts to slow down. Botswana. as there could be orders worth a billion dollars in other projects. MTN has operations in 21 countries across Africa and the Middle East and is one of the largest emerging market mobile operators globally. Without a partner. While Africa has one-third of the world‟s population. such as those pertaining to investments in other geographies or sourcing of equipment. Bharti would have to embark on a Greenfield project. its telephonic density is just 30 per cent. Besides. the economies of scale of the complete outfit (Bharti-MTN) would be taken into account. will be the advantage of economies of scale for the new entity. Collaborating with each other would seem the logical way ahead. companies are more amenable to mergers and acquisitions. Bharti would not be involved only in MTN‟s day-to-day activities. fits perfectly into Bharti‟s plans.

blacks are ensured a minimum shareholding management seats and voting rights. The investment was majorly in handset manufacturing and telecom service provider. So. the cumulative FDI inflow.513. In addition. The Black Empowerment Act could pose a challenge. It is tough for intercontinental companies to merge seamlessly because of cultural divide.    One of the major challenges would be the integration of the company on the ground. in the telecommunication sector amounted to US$ 7.  The Indian telecom industry has always allured foreign investors. Although Nokia-Siemens has bridged this divide faster. as it is meant to safeguard the rights of the black population. Bharti would be able to tap this market through MTN‟s expertise. In fact.22 million.Africa is quite like rural India and from that perspective. it was because both the companies were European. MTN has a vast experience in running multi-country operations and overcoming regulatory hurdles. life for Bharti will get a lot of easier. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 48 . from August 1991 to March 2007. Bharti could learn how to roll out infrastructure in rural India. Congress of South African Trade Unions (COSATU). which has influence over President Jacob Zuma. as and when mobile commerce picks up in India (after RBI‟s approval). MTN is strong in the value-added services (VAS) and mobile commerce space. Alcatel-Lucent for instance is still trying to adjust to cultural divide. had almost wrecked the Vodafone-Vodacom deal. As per this Act. By working with MTN. This makes telecommunication the third-largest sector to attract FDI in India in the post liberalization era.  The country’s strong trade union.

thereby further reducing the cost. service providers find it difficult to manage their infrastructure and network. An example is Nokia. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 49 . On account of the rapidly growing subscriber base. investors have outlaid US$ 1.5 billion in the past two and a half years in the Indian telecom sector. Hutchitson Essar (now Vodafone) and Nokia Deal: A case in point is Nokia which is managing the network for Hutchison Essar Limited in 19 circles in India. India will receive an additional US$ 2 billion investment in the next one year. Local manufacturing allows companies to avoid 4 per cent countervailing duties on imported handsets. The company has already produced 25 million handsets in its Chennai facility. India has the potential to become the electronics manufacturing hub of the world. Managed service is another segment that is attracting telecom companies. It will pump in an additional US$ 150 million to this set up. the Middle East and Africa. The company exports around 20 per cent of its volume to Southeast Asia.With stable macroeconomic impetus and numerous other advantages. In such cases. the Indian telecom handset manufacturing market is likely touch US$ 7 billion by 2010. Excited by the record-breaking industry growth. they completely or partially outsource their infrastructure or network management operations. With the world now recognizing India‟s manufacturing potential. Having successfully capitalized on the business potential of managed service.

IT help desk services and end-to-end connectivity and fulfilling all telecom and communication requirements. IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 50 . customer relationship management and data warehousing. Advantages of Managed Service • Smooth management of technological complexity • Opportunity to strengthen core competency • Reduction in financial outlay • Touching base with new processes and technologies Another dimension of managed service is telecom. Bharti’s Outsourcing to Alcatel-Lucent: Telecom major Bharti Airtel has a $500-million deal to Alcatel-Lucent for outsourcing the management and servicing of its broadband and fixed line network for five years. This information technology outsourcing deal with infotech major IBM is estimated to be in the range of $700750 million for a ten-year period. The deal involves the creation of a joint venture with Alcatel-Lucent holding 76 per cent of the equity. IBM will consolidate BTVL's data center. On the infrastructure front. The deal includes all customer-facing IT applications like billing. e-mail and online collaborations are included in it. he said. together offer telecom and IT solutions in India. IT helpdesk and enhance its disaster recovery center capabilities. Bharti Televentures and IBM. software and IT service requirements to IBM. The agreement specifies that payments made to IBM India will be linked to the percentage of revenue generation by BTVL and pre-defined service level agreements. In addition. and Bharti having the remainder 24 percent. The solutions and services portfolio comprises of the remote monitoring of servers.Nokia is already earning 30 per cent of its total revenue from this segment. The percentage-linked revenue payment is modeled to decrease with BTVL's increase in revenue. Internet. server management and storage management). security operations and network operations. The company manages 39 cellular networks in 30 countries. The deal involved outsourcing of BTVL's hardware. The joint venture will help accelerate performance as Bharti migrates to the next generation networks for the broadband and telephone customers. The company has also shifted its first Global Network Solutions Centre (GNSC) to India. providing data center services (including server hosting. Its Indian center will act as a global hub for other Nokia operation centers. communication and network management solutions for enterprises.

This comes close on the heels of Bharti‟s recent signing of a $1bn three-year service contract with Ericsson towards design. This will make usage of data services easy. IP Multimedia Subsystem (IMS) IP Multimedia Subsystem (IMS) is a generic architecture for offering multimedia and voice over IP services. planning. Bharti would have 100% ownership of the networks supplied by Nokia. Maharashtra & Goa. Kolkata. Orissa. The network monitoring operations will be carried out from Nokia‟s state-of-the-art Global Network Services Center in Chennai. Wireline broadband and other packet data applications. It is also intended to allow operators to introduce new services. Bihar. supply. WAP and MMS. WCDMA. Gujarat. branding and pricing. value added services. As per the three-year contract. WLAN. Nokia will provide managed services and expand Airtel‟s GSM/GPRS/EDGE networks in eight circles of Mumbai. e-mail. including customer services to global majors. such as web browsing. at the top level of their packet-switched networks. IP Multimedia Subsystem is standardized reference architecture. CDMA2000. This has enabled Bharti to focus on its core areas: product innovation. IMS will make Internet technologies. such as web browsing. It enables new IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 51 . It has enabled Bharti to concentrate on customers. IMS is access independant as it supports multiple access types including GSM. connection control and an applications services framework along with subscriber and services data. marketing. defined by 3rd Generation Partnership Project (3GPP). The deal also envisages Nokia to deploy its WAP solution across Bharti‟s national network to enhance its mobile packet core network capabilities. This also marks Bharti‟s third major deal with Nokia in the last two years.Bharti Outsourcing Deal with Nokia & Ericsson Bharti Airtel awarded a $400m contract to Nokia for expanding its managed GSM networks in eight circles. commissioning and upgrading of its network in 15 telecom circles. thereby increasing the consumption of content on the Bharti network. West Bengal and Madhya Pradesh. This emphasizes Bharti‟s policy towards outsourcing all operational activities. finances and regulation. Future Technology Trends In this section we have listed down the future technologies which are in roadmap and are speculated to make an impact on current business model of telcos. with the actual payment being linked to utilization of capacity and fulfillment of agreed quality of service parameters. IMS consists of session control. installation. instant messaging and video conferencing available to everyone from any location.

converged voice and data services. and broadband networks. employing a range of different wireless and fixed access technologies. push-to-view. So users will be able to execute all their services when roaming as well as from their home networks. It is a different approach to the more traditional telco architecture of a set of specific network elements implemented as a single telco-controlled infrastructure. between an IMS user and a user on the Internet. the interfaces for service developers are also based on IP protocols. So. A single IMS presence-and-availability engine could track a user's presence and availability across mobile. Moreover. while allowing for the interoperability of these converged services between internet and cellular subscribers. defined by the IETF. pay for and download a video clip to a chosen mobile or fixed device and subsequently use some of this material to create a multimedia message for delivery to friends on many different networks. and between two users on the Internet is established using exactly the same protocol.and circuit-switched networks. push-to-video Effectively. A key point of IMS is that it is intended as an open-systems architecture: Services are created and delivered by a wide range of highly distributed systems (real-time and non-real-time. A user could. Some of the possible applications where IMS can be used are:          Presence services Full Duplex Video Telephony Instant messaging Unified messaging Multimedia advertising Multiparty gaming Video streaming Web/Audio/Video Conferencing Push-to services. IMS provides a unified architecture that supports a wide range of IP-based services over both packet. possibly owned by different parties) cooperating with each other. High Speed Downlink Packet Access (HSDPA) High Speed Downlink Packet Access (HSDPA) is a packet based technology for W-CDMA downlink with data transmission rates of 4 to 5 times that of current generation 3G networks IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 52 . fixed. a multimedia session between two IMS users. for example. such as push-to-talk. or a user could maintain a single integrated contact list for all types of communications. IMS uses open standard IP protocols.

Machine-to-machine transmission will involve two basic equipment types: sensors (which measure parameters) and tags (which are generally read/write equipment). low user charges. And in the future. It will be the successor for the 3Rd Generation (3G) network technology. rapid return on investment for operators. The evolution from 3G to 4G will be driven by services that offer better quality (e. it is probable that the radio access network will evolve from a centralized architecture to a distributed one. 4G or Fourth Generation Networks 4G or Fourth Generation is future technology for mobile and wireless comunications. Mobile terminal usage (laptops. fixed) services will come about through the high session data rate. Service and application ubiquity. for data and streaming applications. in the same way as Enhanced Data rates for GSM Evolution (EDGE) does in the Global System for Mobile communication (GSM) world. high capacity. video and sound) thanks to greater bandwidth. Currently . will be another driver. high session rate. Fluid high quality video and network reactivity are important user requirements. At the same time. handhelds) is expected to grow rapidly as they become more user friendly.(UMTS) and 15 times faster than GPRS. and will be less expensive for users than dedicated channels. It is expected that users will require high data rates.4 Mbps. high speed data will drive forward the fourth generation (4G) as short-range communication emerges. with a high degree of personalization and synchronization between various user appliances. investment that is in line with the growth IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 53 . Personal digital assistants. Key infrastructure design requirements include: fast response.g. The latest release boosts downlink speeds from the current end-user rate of 384 kbps (up to 2 Mbps according to standards) to a maximum value according to standards of 14. and improved personalization. Currently 3G networks are under deployement. low cost. Real life end-user speeds will be in the range of 2 to 3 Mbps. The introduction of shared channels for different users will guarantee that channel resources are used efficiently in the packet domain. HSDPA provides a smooth evolutionary path for Universal Mobile Telecommunications System (UMTS) networks to higher data rates and higher capacities. It will require an always-on connection and a revenue model based on a fixed monthly fee. Approximatly 4G deployments are expected to be seen around 2010 to 2015. The impact on network capacity is expected to be significant. video and TV services are driving forward third generation (3G) deployment. similar to those on fixed networks. more sophistication in the association of a large quantity of information. multimedia. The basic voice was the driver for second-generation mobile and has been a considerable success. Convergence with other network (enterprise.

3.in demand. Bharti-MTN deal [7] Moneycontrol. the FDI influx will make the telecom space in India a must watch in the coming years. REFERENCES [1} IBEF report 2007-08/08-09 : Telecommunication .5G. facilitating the introduction of a new source of local traffic: machine-to-machine. Also the easing of the regulations by TRAI .in/indian-telecom-industry/idea-tmi-acquires-spice-telecom-1805/ SALES AND DISTRIBUTION Page 54 IIPM – AHMEDABAD . and simple autonomous terminals. The Indian Telecom Service provider industry is gearing for a revolution.wikipedia. The infrastructure will be much more distributed than in current deployments.A Report.pluggd. [2] Cellular Statistics – Cellular Operator Association of India [3] IAMAI & eTechnology Group@IMRB: MOBILE VALUE ADDED SERVICES IN INDIA. [10] World Bank Report: Spectrum auctions in India: lessons from experience WEBSITES USED:     http://www.Poaching with Portability. The customer is driving this revolution and will see more unique and sophisticated offerings coming his way.org/wiki/Spice_Telecom http://www. The rural areas which have remained untapped will see an insurgence of services.MARKET & OPPORTUNITIES.the ease of spectrum licensing.airtel.in http://en. The 3G which will pave the way for 3. [6] Business India : Telecom Takeover.75G and the next big thing-4G and the VAS services will keep the customer asking for more.com: Idea Spice deal [8] Business Standard: Vodafone Hutch deal *9+ IntoMobile: India’s 3G License Plans Updated. [4] Telenor Entering India: Investment Update [5] Voice and Data(May 2009): Mobile Number Portability .wikipedia.org/wiki/Idea_Cellular http://en.

google.ideacellular.com MAGAZINES USED:     4PS Business Economics Times of India Industrial Handbook 2009 IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 55 .com/media/features/features.vodafone.bsnl.co.in www.htm http://www.in/mobile-service-providers.in/about.aspx?ID=1d95UDdxCdM http://www.com www.adityabirlanuvo.co.htm www.mobiles.      http://www.

IIPM – AHMEDABAD SALES AND DISTRIBUTION Page 56 .

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