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The history of telecommunication industry started with the first public demonstration of Morses electric telegraph, Baltimore to Washington in 1844. In 1876 Alexander Graham Bell filed his patent application and the first telephone patent was issued to him on 7th of March. In 1913, telegraph was popular way of communication. AT&T commits to dispose its telegraph stocks and agreed to provide long distance connection to independence telephone system. In 1956, the final judgment limited the Bell System to Common Carrier Communications and Government projects but preserving the long-standing relationships between the manufacturing, researches and operating arms of the Bell System. In this judgment AT&T retained bell laboratories and Western Electric Company. This final judgment brought to a close the justice departments seven year-old antitrust suit against AT&T and Western Electric which sought separation of the Bell Systems Manufacturing from its operating and research functions. AT&T was still controlling the telecommunication industry. In 1982 , AT&T was requested to divestiture its stock ownership in Western Electric; termination of exclusive relationship between AT&T and Western Electric; divestiture by Western Electric of its fifty percent interest in Bell Telephone Laboratories, AT&T s telecommunication research and development facility, is a jointly owned subsidiary in which AT&T and Western Electric each own 50% of the stock; separation of telephone manufacturing from provision of telephone service and the compulsory licensing of patents owned by AT&T on a non-discriminatory basis. It was telecommunication act of 1996 that true competition was allowed. The act of 1996 opened the market to all competitors. AT&T being the first telecommunication company paved the road for the telecommunication industry as well as set the policy and standards for others to follow. Beginning of telecommunication in India 1851 First operational land lines were laid by the government near Calcutta 1881 Telephone services introduced in India 1883 Merger with postal system 1923 Formation of Indian radio Telegraph Company 1932 Merger of ETC and IRT into Indian Radio and Cable Communication Company 1947 Nationalization of all foreign telecommunication companies to form the posts, telephone and telegraph, a monopoly run by the governments ministry of communications 1985 Department of telecommunication established , an exclusive provider of domestic and long-distance services that would be its own regulator 1986 Conversion of dot into two wholly government owned companies the VSNL for international telecommunication and MTNL for services in

metropolitan areas 1997 Telecom regulatory authority created Telecommunication is important not only because of its role in bringing the benefits of communication to every corner of India but also in serving the new policy objectives of improving the global competitiveness of the Indian economy and stimulating and attracting foreign direct investment. Indian Telecom industry is one of the fastest growing telecom markets in the world. In telecom industry, service providers are the main drivers; whereas equipment manufacturers are witnessing growth and decline in successive quarters as sales is dependent on order undertaken by the companies.

TELECOM INDUSTRY SCENARIO IN INDIA The Indian telecommunications market has been displaying sustained high growth rates. Riding on expectations of overall high economic growth and consequent rising income levels, it offers an unprecedented opportunity for foreign investment. A combination of factors is driving growth in the telecom market, promising rich returns on investments. Over the past 10 years, India has registered the fastest growth among major democracies, having grown at over 7 per cent in four years during the 1990s. It represents the fourth largest economy in terms of Purchasing Power Parity. According to a recent Goldman Sachs report, over the next fifty years, Brazil, Russia, India and China - the BRIC economies- could become a much larger force in the world economy. It reports, India could emerge as the worlds third largest economy and of these four countries; India has the potential to show the fastest growth over the next 30 to 50 years. The report also states that, Rising incomes may also see these economies move through the sweet spot of growth for different kinds of products, as local spending patterns change. This could be an important determinant of demand and pricing patterns for a range of commodities. The share of the services sector as a percentage of total GDP is also predicted to rise from the current 46 per cent to about 60 per cent by 2020. The boom in the services sector is slated to come from India, emerging as a chosen destination for software and other IT enabled services, tourism etc. According to a Nasscom- McKinsey & Co.

Study, by 2008, the Indian IT software and services sector will account for US$ 70-80 billion in revenues; itll employ 4 million people, and account for 7 per cent of Indias GDP and 30 per cent of Indias foreign exchange inflows. Population projections from the Planning Commission of India suggest that the share of the working age population (15-64 years) in total population will grow from the current 59 per cent to about 65 per cent, translating into 882 million by year 2020.According to the Vision 2020 document for the Planning Commission of India, the country will witness continued urbanization. The urban population is expected to rise from 28 per cent to 40 per cent of total population by 2020.Future growth is likely to be concentrated in and around 60 to 70 large cities, each having a population of one million or more. This profile of concentrated urban population will facilitate customized telecom offerings from operators. Over the years, spending power has steadily increased in India. Between 1995 and 2002, nearly 100 million people became part of the consuming and rich classes. Over the next five years, 180 million people are expected to move into the consuming and very rich classes. SERVICES PROVIDED BY THE TELECOM INDUSTRY Wire line Services

1 Wire line services subscriber base stood at 37.96 million in quarter ending March 2009 as compared to 37.90 million in quarter ending December 2008.

2 Rural Wire line Subscriber base stood at 10.58 million in quarter ending March 2009 as compared to 10.68 million in quarter ending December 2008.

3 Number of Village Public Telephones (VPTs) have increased from 5.39 lakhs in quarter ending December 2008 to 5.61 lakhs in quarterly ending march 2009

4 Number of Public Call Offices (PCOs) have increased from 5.98 million in quarter ending December 2008 to 6.20 million in quarter ending March 2009.

The breakup of wire line subscriber base in India as of September 2010 is given below.


Subscriber base





Bharti Airtel


Reliance Communications 1,152,237

Tata Teleservices


HFCL Infotel


Teleservices Ltd


All India


Wireless Services

1 The Wireless subscribers have reached 391.76 million as on 31st March 2009 as against 346.89 million subscribers in the previous quarter. During this quarter 44.87 million wireless subscribers were added.

2 Technology-wise Wireless Market Share There are 297.26 million GSM subscribers (75.88%) and 94.50 million CDMA subscribers (24.12%) at the end of March 2009.

GSM The GSM subscriber base has reached 297.26 million in the quarter ending March 2009 as against 258.23 million at the end of the previous quarter.

CDMA The CDMA subscriber base has reached 94.50 million in the quarter ending March 2009 as against 88.66 million at the end of the previous quarter The breakup of wireless subscriber base in India as of September 2009 is given below:


Subscriber base

Bharti Airtel


Reliance Communications


Vodafone Essar




Idea Cellular


Tata Teleservices






MTS India


Loop Mobile India




HFCL Infotel




All India


Internet Services (Including Broadband) 1) There are 13.54 million Internet subscribers at the end of March 2009 as compared to 12.85 million Internet subscribers at the end of December 2008 registering a growth of 5.30%. This growth rate is higher as compared to the growth rate of 5.01% at the end of December 2008.

2) Besides above, there are 117.82 million wireless data subscribers at the end of March 2009 (capable of accessing data services including internet through mobile handsets [GSM/ CDMA]).

3) Broadband Subscriber Growths - The number of Broadband subscribers (with a download speed of 256 Kbps or more) was 6.22 million at the end of March 2009 as compared to 5.52 million at the end of December 2008. The growth rate of broadband subscribers in this quarter is 12.68%.

ISP Providers In INDIA BSNL MTNL Bharti Airtel Reliance

% Market Share 54% 16% 8% 7%

Sify Hathway Tata Others Total

2% 2% 2% 8% 100%

4) Broadband Subscribers Share (Technology wise) Out of total 6.22 million broadband subscribers, 5.364 million are DSL based; 0.474 million Cable Modem; 0.244 million Ethernet LAN; 0.042 million Fiber; 0.072 million Wireless, 0.020 million Leased Line and 0.002 million use other technologies.

TIMELINE - EVOLUTION OF INDIAN TELECOM Mid 1980s Mar 1986 Department of Telecommunications set up VSNL incorporated to provide international telecom services

Apr 1986 Delhi Dec 1991

MTNL incorporated to provide fixed-line telephone services in Mumbai and New

DoT invites bids from Indian companies for cellular licenses in

the four

metropolitan circles May 1994 Government announces the National Telecom Policy, opening up the basic service sector to private players Sep 1994 Nov 1994 Mar 1995 Oct 1996 Jan 1997 Nov 1998 Mar 1999 Jul 1999 Entry guidelines for basic services announced Licenses were issued to cellular operators in the four metros Paging services by private operators commence Licenses for 20 cellular circles issued Telecom Regulatory Authority of India established by government ISP business opened up to operators other than DoT and VSNL Government announces NTP 1999 DoT announces Migration Package for existing operators' licensing costs, subject to compliance with certain conditions Aug 2000 Government announces guidelines for opening up domestic long distance

telephony for carrying both inter-circle and intra- circle traffic, with no restriction on the number of players TRAI issues the first tariff order and cuts domestic and international long distance telephone charges. Jan 2001 The Department of Telecom opens up basic services to unlimited competition and allows basic operators to provide WLL services on a restricted basis. Aug 2001 Jan 2002 Opening of National Long Distance Service to competition Bharti starts cellular to cellular long distance services with sharp cuts in tariffs

Apr 2002 May 2002 Sep 2002 Mar 2006 allocation Mar 2007



opened ILD to


competition. with from

End sharp


VSNL cuts

monopoly. in tariffs tariffs

offers decides

services 'forbear'



WPC set subscriber thresholds for GSM and CDMA operators for spectrum

9 distinct operators had been allocated GSM spectrum. Out of these, only Bharti has a pan-India presence.

Aug 2007

Subscriber thresholds were revised by TRAI as operators could support more subscribers with lower spectrum as compared to WPC allocation

Jan 2008

Govt of India allocated start-up spectrum to all prior licensees awaiting spectrum (does not include LOIs issued in January 2008). These include Aircel (14 circles), Idea (2 circles), RComm (14 circles) and Vodafone (6 circles).

Jun 2009 Apr 2010

TRAI plans to introduce MNP (Mobile Number Portability) on a pan-India basis. 3G Spectrum Auction

LATEST DEVELOPMENT A WIDE LOOK ON INDIAS 3G AUCTIONS: Indias auction for 3G GSM Service licence ended today with bids for pan-India licence touching Rs 16,751 crore which ensures the Government of India a revenue of Rs 67,719 crore.

The 3G auction had commenced on 9 April, 2010 and there were nine bidders in the fray for the slots of 3G spectrum on the block. The government auctioned three slots in 17 telecom service areas and four slots in the remaining five states of Punjab, Bihar, Orissa, Jammu and Kashmir and Himachal Pradesh. No single bidder bid for a pan-India 3G license so state operator BSNL would be remain the biggest 3G operator in India. Delhi circle emerged the most valuable circle at Rs.3317 crore, followed by Mumbai at Rs.3247 crore. Among the major bidders, Idea cellular paid nearly Rs.5765 cr for 11 telecom circles, while Indias largest 2G Mobile service operator Bharti Airtel

paid Rs.12290 cr for 13 telecom circles, Vodafone Essar will paid Rs. 11617 crore for 9 telecom circle while Reliance Communication paid Rs 8583 crore for 13 telecom circles.

The List of 3G Winners (Private Operators) :

Delhi & NCR: Vodafone, Bharti, Reliance Communications at Rs 3316.93 cr

Mumbai: Reliance, Vodafone, Bharti Airtel at Rs.3247.07 cr

Maharashtra & Goa: Tata Com, Idea cellular, Vodafone at Rs.1257.82


Gujarat: Tata Com, Vodafone, Idea at Rs.1076.06 cr

Andhra Pradesh: Bharti Airtel, Idea, Aircel at Rs.1373.14 cr

Karnataka: Tata Telecommunication, Aircel, Bharti at Rs.1579.91 cr

Tamil Nadu: Bharti, Vodafone, Aircel at Rs.1464.94 cr

Kolkata: Vodafone, Aircel, Reliance Communications at Rs.544.26 cr

Kerala: Idea cellular, Tata Telecommunications, Aircel at Rs.312.48 cr

Punjab: Idea

Cellular, Reliance Communications, Tata Telecommunications, Aircel at


Haryana: Idea Cellular, Tata Telecommunications, Vodafone at Rs. 222.58 cr Madhya









Telecommunications at Rs.258.4 cr

Rajasthan: Reliance Communications, Bharti, Tata Telecommunications at Rs.321 cr

U.P. (West): Bharti, Idea Cellular, Tata Telecommunications at Rs. 514 cr

U.P (East): Aircel, Idea Cellular, Vodafone at Rs.364.6 cr

West Bengal:Bharti,Reliance Telecom, Vodafone, Aircel at Rs.123.36 cr

Himachal Pradesh: Bharti, STel, Idea cellular, Reliance at Rs.37.23 cr.

Bihar & Jharkhand : Stel, Bharti, Reliance, Aircel at Rs.203.46 cr

Orissa : Stel, Aircel, Reliance at Rs.96.98 cr

Assam: Reliance, Bharti, Aircel at Rs.41.48 cr

North East: Aircel, Bharti, Reliance at Rs.42.30 cr

Jammu & Kashmir : Idea, Aircel, Bharti, Reliance at Rs.30.30 cr

State telecom operator BSNL and MTNL already received 3G spectrum outside the auction process, and launched 3G mobile services in more than 430 cities across India, but the bidding price would be determined by the auction price.

Telecom Sector and Union Budget 2010: The union Budget 2010-11 neglected the telecom industry's special demands. Telcos were looking at a rationalisation of tax and levies, uniform license fee of one per cent of the AGR.

Telcos wanted a re-look at direct tax, tax holidays and section 81 (A), a re-look at licenses and indirect taxes As far as the telecom sector is concerned, Dua said that while the reduction in Corporate Surcharge would provide a minor relief, but at the same time the increase in MAT from 15% to 18% is a major area of concern. He further added that the increase in Central excise duty from 8% to 10% is another area of concern and will lead to an increase in cost of service. The continuation of exemption from basic, CVD and special additional duties (SAD) granted to their parts, components and accessories of mobile phones is a welcome step and would help towards penetration of affordable mobile service especially to rural areas. COAI welcomed the impetus given by the Finance Minister to the use of clean/ alternate energy.


Porters five forces model uses concepts developed by Industrial Organisation economics to derive five forces that determine the competitive intensity and therefore attractiveness of a market.


This describes the intensity of competition between existing firms in an industry. Highly competitive industries generally earn low returns because the cost of competition is high. A highly competitive market might result from: i) ii) Many players of about the same size; there is no dominant firm Little differentiation between competitors products and services


A mature industry with very little growth; companies can only grow by stealing customers away from competitors

There are majorly 3 types of players in the industry i) ii) iii) State owned players. (BSNL and MTNL) Private Indian players. (Reliance comm., Tata comm., Bharti Airtel) Foreign invested companies. (Vodafone, Idea cellular)

There has been a stiff competition in the telecom market over a period of time. Let us talk about the current scenario.

At present has a subscribers base of above 6,47,44,985 with a market share of apron. 15%. BSNL has an edge over private players as it has already started with 3G spectrum services across India. BSNL is BSNL dedicatedly performing its work as it drives India into the next league of telecom supremacy by providing technologically advanced services to its discerning customers at an affordable cost

On the private side, there has been a tough competition between Bharti airtel and Vodafone each having a market share of 30 % and 24% respectively. Even the growth rate of both the companies for the month of April when compared with March is around +/- 2.5% .

Both are again in the race to start with the 3G services and cater it all across India and give a tough competition to BSNL who is already in the market. Idea cellular, Reliance comm. and Aircel are also in the race as they lack in the infrastructure when compared with Vodafone and Bharti Airtel


This is how much pressure customers can place on a business. If one customer has a large enough impact to affect a company's margins and volumes, then the customer hold substantial power. Here are a few reasons that customers might have power:
i) ii) iii)

Small number of buyers Purchases large volumes Customers are price sensitive.

Indian telecom industry is one of the fastest growing or second largest in the world. In this industry, service providers are the major drivers. The major booster is the wireless mobile subscribers which have crossed 433 million. There has been a major increase in subscribers in the month of April,2010 by a whopping 11 mn. It is expected to grow more after the 3G services starting off from sep1,2010,


This is how much pressure suppliers can place on a business. If one supplier has a large enough impact to affect a company's margins and volumes, then it holds substantial power. Here are a few reasons that suppliers might have power: i) There are very few suppliers of a particular product a. There are no substitutes ii) iii) iv) Switching to another (competitive) product is very costly The product is extremely important to buyers - can't do without it The supplying industry has a higher profitability than the buying industry

As far as telecom industry is concerned there are very few suppliers in the market. So the role of suppliers is almost negligible in the industry. We are trying to analyze that minor role.

1. Mobile handset suppliers : There are many handset suppliers in the market, some of them are Nokia, Samsung, Motorola, Sony Ericsson, Reliance Classic, Tata Indicom, etc. Few of the new entrants are Spice, Micromax, Karbon, etc. 2. Some other suppliers in the industry are the suppliers of Optical fibre and Aluminium. Other important parameter in this can be the software assistance, where suppliers can have edge over. The major software providers are TCS, Infosys, Wipro, Satyam etc. Again one thing is noticeable that big giants like Reliance and Tata have their own software solution departments

The easier it is for new companies to enter the industry, the more cutthroat competition there will be. Factors that can limit the threat of new entrants are known as barriers to entry. Some examples include:
i) ii) iii) iv) v)

Existing loyalty to major brands High fixed costs Scarcity of resources High costs of switching companies Government restrictions or legislation

The Indian telecom sector offers unprecedented opportunities for foreign companies in various areas such as 3G, Virtual Private Network, international long distance calls, value added services, etc. The market is witnessing M&A like the Bharti Zain, which are leading to consolidations in the industry. This sector also attracts FDI which has made it the third largest sector attracting FDI in the post liberalization era.


What is the likelihood that someone will switch to a competitive product or service? If the cost of switching is low, then this poses a serious threat. Here are a few factors that can affect the threat of substitutes:

The main issue is the similarity of substitutes. For example, if the price of coffee rises substantially, a coffee drinker may switch over to a beverage like tea.


If substitutes are similar, it can be viewed in the same light as a new entrant.

There is a cut throat competition and a price war for the tariffs of the service provider. Today the difference in the price of the of two products is marginal. Also with the availability of additional services like GPRS, internet, video conferencing etc, the option of substitutes for the consumer is never ending. In todays scenario, there are consumers who are ready to change their service providers for a reduction in the tariffs, which poses a major threat to the companies..


Strong mobile subscribers growth is continuing, with the market benefiting from healthy degree of competition. The mobile market plays host to a large number of strategic investors including Singapores SingTel, Vodafone from U.K, Telecom Malaysia, Etisalat from UAE, Japans NTT DoCoMo and Russias Sistema. Demand for mobile Value Added Services is strong and expected to grow.

WEAKNESS: Mobile market is still inclined towards prepaid users. The dominance of prepaid services has contributed to declining mobile average revenue per user (ARPU) levels. Disagreement between the regulator TRAI and government ministries has led to delayed policy implementation in a number of areas, most notably 3G licensing.

OPPURTUNITIES: The government is currently considering recommendations made by TRAI to allow the operations of MVNOs (Mobile Virtual Network Operator) in the mobile market. The government will cut license fees upto 33% for those operators whose service covers 95% of the residential area in a calling circle. There is an opportunity to cover the vast untapped rural market.


Government plans to increase spectrum usage charges for telecom companies. Network capacity, particularly in the mobile market, could struggle to keep up with demand. Stiff competition in the market will make service providers difficult to retain customers. Airtel


Bharti Tele-Ventures was incorporated on July 7, 1995 as a company With limited liability under the Companies Act, for promoting telecommunications services. Bharti Tele-Ventures received certificate for commencement of business on January 18, 1996. The Company was initially formed as a wholly-owned subsidiary of Bharti Telecom Limited. The chronology of events since Bharti Tele-Ventures was incorporated in 1995 is as follows: Calendar year & Events 1995 - Bharti Cellular launched cellular services'AirTel'in Delhi 1996 - STET International Netherlands NV, or STET, a company promoted by Telecom Italia, Italy acquired a 20% equity interest in Bharti Tele-Ventures - Bharti Telenet launched cellular services in Himachal Pradesh 1997 - British Telecom acquired a 21.05% equity interest in Bharti Cellular - Bharti Telenet obtained a license for providing fixed-line services in Madhya Pradesh circle - Bharti Telecom and British Telecom formed a 51% : 49% joint

venture, Bharti BT, for providing VSAT services 1998 - Bharti Telecom and British Telecom formed a 51% : 49% joint venture, Bharti BT Internet for providing Internet services - First Indian private fixed-line services launched in Indore in the Madhya Pradesh circle on June 4, 1998 by Bharti Telenet thereby ending fixed-line services monopoly of DoT (now BSNL) 1999 - Warburg Pincus (through its investment company Brentwood Investment Holdings Limited) acquired a 19.05% equity interest in Bharti Tele-Ventures - Bharti Tele-Ventures (by acquiring a 63.45% equity interest in SC Cellular Holdings) acquired an effective 32.36% equity interest in Bharti Mobile (formerly JT Mobiles), the cellular services provider in Karnataka and Andhra Pradesh circles - New York Life Insurance Fund, or NYLIF, acquired a 3% equity interest in Bharti Cellular 2000 - Bharti Tele-Ventures acquired an effective equity interest of 40.5% in Bharti Mobinet (formerly Skycell Communications), the cellular services provider in Chennai - Bharti Tele-Ventures acquired a 30.2% equity interest of Telecom Italia in Bharti Telenet and 18.8% from Bharti Telecom thereby making Bharti Telenet a 100% subsidiary of Bharti Tele-Ventures - SingTel (through its investment company Pastel Limited) acquired

STET's 15.3% equity interest in Bharti Tele-Ventures - Bharti Tele-Ventures acquired an additional effective 41.64% equity interest in Bharti Mobile (by acquiring the remaining 36.55% equity interest in SC Cellular) resulting in Bharti Tele-Ventures holding an effective 74% equity interest in Bharti Mobile. 2001 - Bharti Tele-Ventures acquired NYLIF's 3% equity interest in Bharti Cellular - Bharti Telesonic entered into a joint venture, Bharti Aquanet, with SingTel for establishing a submarine cable landing station at Chennai - Bharti Tele-Ventures issued additional equity for approximately US$ 481.30 million to SingTel, Warburg Pincus, AIF group, IFC, NYLIF, and Seejay Cellular and Bharti Telecom - Bharti Cellular acquired a 100% equity interest in Bharti Mobitel (formerly Spice Cell ), the cellular services provider in Kolkata - Bharti Tele-Ventures acquired 85% and 15% in Bharti Telespatial from Bharti Telecom and Intel, respectively - Bharti Tele-Ventures acquired a 44% equity interest in Bharti Cellular from British Telecom, thereby making Bharti Cellular its 100% subsidiary - Bharti Tele-Ventures acquired an additional 49% equity interest in Bharti Mobinet from Millicom International and BellSouth International, thereby owning 89.5% equity interest in Bharti Mobinet, which was further increased to 95.3% following an issuance of additional equity shares by way of rights issue

- Punjab license restored to Bharti Mobile by the DoT and migration to NTP - 1999 accepted - Bharti Cellular entered into license agreements to provide cellular services in eight new circles following the fourth operator cellular license bidding process - Bharti Telenet entered into license agreements to provide fixed-line services in the Haryana, Delhi, Tamil Nadu and Karnataka circles - Bharti Telesonic entered into a license agreement with the DoT to provide national long distance services across India - Bharti Aquanet, Bharti Telesonic and Bharti Cellular entered into license agreements with the DoT to provide ISP services in India - Bharti Telesonic launched national long distance services under the brand name of IndiaOne - Bharti Telenet launched fixed line services in Haryana under the brand name of TouchTel. 2002 - Comes out with issue of 18.53 crore equity shares through book building route with a floor price of Rs 45 per share, received bid for 18.55 crore shares. Through the issue, it becomes the first company in India to come out with 100% book building issue -Issue price fixed at Rs 45 per share, floor price fixed by the company. Raises Rs 834 crore -Shares listed on BSE, NSE and DSE, opens at 11% premium to its issue price of Rs 45 -Enters into a 5-year agreement with Escotel and ETL of the Escorts group to contract leased line connectivity for its cellular operations

-Mr. Ravi Akhoury ceases to be Director of Bharti Tele -DoT grants ILD Telephony License to Bharti Telesonic, subsidiary of the company -Signs MoU with Telia AB to buy out their 26% stake in Bharti Mobile -Ties up with SSC (Secondary School Certification) Board, Hyderabad, where Bharti will announce SSC results to its customers on their mobile phones -ICICI Bank ties up with Bharti for pre-paid mobile cards via ATMs -Bharti forays into Mumbai with offers -Alpine International Ltd. and ELM International Ltd. acquire shares of Bharti Tele-Ventures -Sunil Mittal, Chairman & Managing Director of the company, bags Businessman of the year award by Business India 2003 -Airtel breaks interconnectivity with Tata Teleservices in Andhra Pradesh Circle -Company accorded its approval for amalgamation of its subsidiary companies viz: Bharti Telenet Ltd, Bharti Telesonic Ltd, Bharti Broadband Networks Ltd and Bharti Comtel Ltd through scheme of Amalgamation. The merged entity would be renamed as Bharti Infotel Ltd -Air Tel launches Local direct dialling facility in Chennai circle -Mobilises 5 m long term foreign currency borrowings for expansion of cellular operations -Bharti Cellular unveils CareTouch service -Bharti Group's cellular brand Airtel has unveiled free multimedia messaging services (MMS) for its customers. The company has also rolled out pan-India GPRS (General Packet Radio Services) for its corporate subscribers

-Launches its `IndiaOne MeetXpress' audio-conferencing service -Punjab, Haryana get free incoming calls from Airtel -AirTel provides SMS facilities to hearing impaired in Chennai -Goa, Maharashtra gets 'voice portal' services by Bharti Cellular -Launches free additional connection to its new subscribers in New Delhi -Mr Sin Hang Boon and Mr Wong Hung Khim have resigned from the Board of Directors of Bharti Tele Ventures Ltd with effect from February 27, 2003. -Airtel provides SMS cricket updates -Bharti Mobinet Ltd, the Bharti group company that provides the AirTel mobile service in Chennai, today launched its GPRS (General Packet Radio Service) network and an MMS (multi-media messaging) on the GPRS platform -AirTel unveils new ring tones for karnataka cellular market -AirTel Subscribers exceed 3 million mark -AirTel unveils RAD system -Mr P M Sinha resigns from the Board of Directors of the Company with effect from March 31, 2003. -Bharti TeleVentures announces the completion of merger with Bharti Mobitel -Bharti Mobitel Ltd. merged with Bharti Cellular Ltd. -AirTel reintroduces 'Mobile 2 Mobile' offer for Karnataka customers -AirTel, Touchtel jointly offer freeTouchtel land line for post-paid Airtel connection -AirTel rolls out voice mail service for pre-paid customers -AirTel unveils new scheme for pre-paid customers giving away free

talk time worth Rs 10 crore -Airtel surpasses 4 lakh subscriber base in Karnataka -Bharti announces new tariff plan AirTel 012 -Offers 0-1-2, a new cellular package for the customers, which means zero charges on incoming calls, Re 1 on mobile-to-mobile outgoing calls, Rs 2 on mobile-to-mobile STD calls -Rolls out Airtel messenger service -AirTel offers bundled handset, connection package for Rs 5715 -Airtel slashes SMS rates to 60 paise; excludes Delhi and Mumbai -Bharti cellular, wholly owned subsidiary of Bharti Tele-Ventures, increases its stake to 100% in Bharti Mobile -Iinks distribution pact with Hathway Cable. With this alliance, Bharti is said to be the first telecom firm to step into television distribution services -Six cell operators move over from Bharti to VSNL -Airtel augments cellular coverage in TN by including Arcot & Walajapet in its network -Airtel ties up with Coke in Chennai to sell its Magic prepaid cards -AirTel embarks on network expansion in Hyderabad -Airtel unveils IndiaOne Long Distance Calling Card -AirTel introduces unified tariff package in TN, Chennai -Airtel becomes front runner in Karnataka's mobile services market -Bharti Tele launches 'Always on' service to its subscribers -SBI, AirTel announce EMI offer at Rs 299 -Bharti and MTV join hands to launch new SIM card

-AirTel unveils new post-paid scheme at zero rental -AirTel launches `Happy Plan' in AP -Airtel emerges as the highest selling pre-paid card -Airtel join hands with Alcatel & Videocon to launch new scheme -AirTel service provider touches 5 lakh customers in Punjab -Airtel offers 5 new services for its customers in Mumbai -Bharti launches first dual band network in Delhi -Gets 14th place among top 25 Cos in India -Bharti Mobile crosses 4 lakh mobile subscribers in AP -Airtel holds top position in terms of dealer penetration -Prof. V S Raju has been inducted on the Board of Directors of the Company. -Touchtel launches SMS service in fixed line phones in Karnal, Panipat -AitTel unveils special offers in Kerala -AirTel launches InnoWest for the western region -Bharti Tele-Ventures enters into an agreement with Telesystem (Mauritius) Pvt. Ltd -Airtel slashes out going sms price to 30ps - AirTel on December 16, 2003 announced the launch of expense tracker service, which provides customers the option of tracking their day-to-day expenses on a daily or monthly basis. To avail of this service, the customer should register himself by sending EXP REG Your mail ID{gt} to 3020. This service will allow a user to track expenses, while on the move by sending an SMS. Each SMS sent to 3020 would cost Rs 3. -AirTel introduces MTV Club Card in Chennai

2004 -Bharti unveils new card for Mecca piligrims -AirTel enrolls 50,000 customers in its mobile service in 60 days -Launches WAP enabled portal Service in Kerala - Bharti Cellular's AirTel has extended its mobile connectivity to Karaikkal, Nagur, Mannargudi and Kovilpalayam in Tamil Nadu circle. -Airtel customer base touches new high of 5 lakh mark in Andhra Pradesh - Mobile service provider AirTel is launching its first ever MMS (Multi Media service) downloads in Tamil. The launch of this service has been timed to coincide with Pongal. -AirTel tie up with MAA TV -Airtel launches Rs 50 pre-paids recharge -AirTel launched a family pack for its post-paid customers in Chennai on January 29. According to a press release, the family pack may have a maximum of 10 members spread across the country. The combined basic plan fixed charges/rental of all family members in the pack will have to be equal to Rs 450 but less than Rs 1000 for the family 450 pack and above Rs 1000 for the family 1000 pack. The offerings under family pack 450 include 15 free mobile to mobile STD minutes within the family, 50 free local calling minutes to each family member, calls within the family in same circle at 50 paise per minute, 25 free local SMS and one subscription alert service free for 3 months. -Bharti Tele-Ventures enters into a three year service agreement with Ericsson -Bharti Tele-Ventures (BTVL) has signed and received unified access service licence to provide GSM services in five circles including Uttar Pradesh (East), West Bengal & Andaman Nicobar, Orissa, Bihar and Jammu & Kashmir. The licence has been granted to Bharti Cellular Ltd (BCL), the cellular arm and subsidiary of BTVL. -Airtel announces the signing of the first-ever bilateral roaming

agreement between an Indian mobile service provider and its counterpart in Pakistan. This facility will be available to pre-paid as well as post-paid customers. AirTel's roaming agreement is with Mobilink, the only GSM cellular service provider in Pakistan -Acquires switching systems from Tekelec that will give a technological edge to the company -Bharti Tele-Ventures Ltd signed an information technology outsourcing deal with infotech major IBM, estimated to be in the range of 0-750 million for a ten-year period. -Jayant Khosla, new chief executive officer, Mumbai -Signs MoU to join the South East Asia - Middle East - Western Europe 4 (SEA-ME-WE-4) consortium along with 15 other global telecom operators. -Bharti Tele-Ventures has struck a deal with Shyam Telecom to buy out the latter's 67.5 per cent stake in cellular services company Hexacom for Rs 430 crore. -Bharti Tele garners 0 m via FCCBs - Samsung India Electronics Limited has tied up with cellular operator Bharti for bundling its mobile handsets with a connection. -The Bharti group finalised a Rs 500-crore deal to share its national long-distance (STD) network with VSNL in a first-of-its-kind accord between two top telecom service providers in a bid to optimise capacities in the NLD segment. - Internet gateway and services provider, Videsh Sanchar Nigam Ltd. (VSNL) has signed a Right to Use (RoU) agreement to deploy mobile telephony major, Bharti Tele-Ventures' existing National Long Distance (NLD) backbone. -Airtel offers talktime transfer service -Airtel has announced money-back guarantee offer in case of call drop or poor network experience for its subscribers -Bharti launches 2-in-1 card

-- Airtel launched two-way international roaming and GPRS for prepaid customers in the Maharshtra and Goa circles -India's leading cellular company Bharti Tele-Ventures has bagged the Asian MobileNews operator of the year award in India and the subcontinent -Bharti Tele-Ventures Ltd has awarded a million equipment contract to Swedish telecoms company Ericsson -Bharti Televentures announced formation of a new strategic business unit to offer various telecom and IT services through a single contact -Bharti Televentures unveiled a mobile portal featuring sports, entertainment and news among others -Airtel ties up with Micro Tech to set up 'Mcops' vehicle security system -Bharti Tele-Venture on July 19 launched ring back tone service which is a personalized mobile music service where the caller hears songs and other sound clips instead of the traditional switchboard ring-ring tone -Airtel, a private telecom services provider, has commissioned its first 24x7 customer service centre in Andhra Pradesh -Airtel unveils Rs 199 pre paid card -AirTel join hands with NMIMS to offer executive MBA programme -AirTel introduces new scheme for hearing impaired in Maharashtra & Goa -AirTel inks pact with JP Mobile - Rolls out Enhanced Data Rate for Global Evolution (EDGE) network in Pune on September 9, 2004, Ties up with Nokia for sale of Nokia 6230, an EDGE-enabled handset. -AirTel unveils first virtual calling cards in India -BTVL rolls out EDGE services in Bangalore

-Airtel rolls out Full Talktime Advantage card -Airtel rolls out wi-fi services in Mumbai -BTVL launches new 'Airtel Broadband Friendly Offer' -Airtel launches GPRS services for pre-paid customers -Airtel partners with ITPO to set up Wi-Fi network in Delhi -Airtel launches EDGE services and a new pre-paid plan for Chennai -Airtel introduces LAS in Karnataka 2005 -Airtel launches video services for its GPRS customers on February 22, 2005 -Airtel unveils new TV ad featuring Sachin, Sharukh -Bharti Tele-Ventures launches telecom network in Andaman & Nicobar -BTVL unveil fixed line, broadband services -Bharti inks 5-m deal with Nokia for rural network expansion -Bharti Tele Ventures Ltd has announced that Airtel, ICICI Bank & VISA have joined hands to launch mChq - a revolutionary new service a credit card on the mobile phone -Bharti Tele Ventures - Airtel introduces BlackBerry Connect in India -Bharti Tele Ventures announces agreement with Vodafone -Airtel unveils 'free flight' offer -Airtel unveils starter pack -Bharti Tele-Ventures launches under sea cable system

2006 -Airtel unveils Re 1 STD plans -Airtel launches NetXpert. -Airtel launches Post2Pre recharging service on April 04,2006. -Airtel sets up customer centre -Mobile service provider Airtel today announced the launch of `Save My Phone Contact' service for its pre-paid and post-paid customers in Delhi -Bharti Tele Ventures bags 'Wireless Service Provider of the Year' & 'Competitive Service Provider of the Year' awards -Sunil Mittal bags CEO of the Year award -Cellebrum join hands with Airtel -Airtel Mega unveiled in Coimbatore -Airtel joins hand with Microsoft -Bharti Airtel Ltd has informed that Microsoft and the Company announced a strategic partnership that will offer a range of software and services for small and medium businesses (SMBs) in India. -Bharti Airtel Ltd on Nov 8, announced a first-of-its-kind alliance with the Adani Group for establishing an end-to-end modern telecommunication network infrastructure for the latter's multi-sector special economic zone (SEZ), located near Mundra Port in Kutch district of Gujarat. 2007 -Bharti Airtel, telecom major, has come out with a slew of initiatives including buying out SingTel's 50 per cent stake in joint venture under sea cable company Network i2i for 0 million. -Bharti Airtel on Feb 11, has been awarded QCI-DL Shah National Award on Economics of Quality.

-Bharti Airtel Ltd has announced the following changes in the operational leadership structure and roles in the Company effective April 01, 2007. -Bharti Airtel Ltd on April 01, 2007, has announced the reduction in International Long Distance Tariffs (ISD) for all its mobile customers in India. -Airtel signs agreement with HTC for touch screen mobile. 2008 - Nokia Siemens Networks on Jan 3 declared that it has been awarded a multi million euro contract from Bharti Airtel Ltd for deployment of a single interactive voice response (IVR) platform across 23 circles. The three-year turnkey contract comprises designing, planning, systems integration and optimisation services to raise overall customer experience. The new IVR solution will enable Airtel to deliver services such as voice SMS, televoting, call management services, caller ring back tone and voice portal on a faster time-to-market basis and, therefore, reduce OPEX costs. - Bharti Airtel Ltd on February 13, 2008 has announced that it has achieved the 60 million customer mark. This landmark has catapulted Bharti Airtel into the club of top mobile operators in the world in terms of subscriber base. The 60 million customer base covers mobile as well as fixed line and broadband customers. - Bharti Airtel tied up with US-based Apple Inc to bring the popular GSM-based iPhone in the country. - Bharti Airtel Ltd has forged a technology alliance with Infosys Technologies Ltd to launch its Direct-to-Home (DTH) television services. Infosys, through its digital convergence platform, will offer a suite of products including devices, application servers and interactive applications for Airtel's DTH services. 2009 - Bharti Airtel HAS signed a five-year managed services deal valued at 0 million with Alcatel Lucent for its fixed-line and broadband operations. - Bharti Airtel launched the 'Airtel Advantage' initiative. The

initiative is aimed at offering the added advantage to Airtel customers to be in touch with each other at an affordable rate of 50 paise per minute, be it a national long distance call (STD) or a local call. - In order to create products and services for the small, medium and large enterprises, Bharti Airtel and Cisco announced a strategic business alliance. The alliance would combine the strengths of Airtel's network service and Cisco' Internet Protocol (IP) technologies. - Bharti Airtel - Airtel and mChek announce milestone of One Million users; introduce a broad range of new mCommerce services. 2010 - Bharti Airtel submitted its bid for 3G spectrum, the auction for which starts from April 9. - Bharti Airtel has partnered with US-based software maker VMware Inc. It has done this in order to focus on the cloud-based managed computer services market. - Bharti Airtel, India's No.1 cellular carrier has won broadband spectrum in four circles. Earlier, Bharti has said that it had tied up the entire financing requirement of .3 bn for the planned buy, through a series of banks.

Company profile Telecom giant Bharti Airtel is the flagship company of Bharti Enterprises. The Bharti Group has a diverse business portfolio and has created global brands in the telecommunication sector. Airtel comes from Bharti Airtel Limited, Indias largest integrated and the first private telecom services provider with a footprint in all the 23 telecom circles. Bharti Airtel since its inception has been at the forefront of technology and has steered the course of the telecom sector in the country with its world class products and services. The businesses at Bharti Airtel have been structured into three individual strategic business units (SBUs) - Mobile Services, Airtel Telemedia Services & Enterprise Services. The mobile business provides mobile & fixed wireless services using GSM technology across 23 telecom circles while the Airtel Telemedia Services

business offers broadband & telephone services in 95 cities and has recently launched India's best Direct-to-Home (DTH) service, Airtel digital TV. The Enterprise services provide end-to-end telecom solutions to corporate customers and national & international long distance services to carriers. All these services are provided under the Airtel brand. The company served an aggregate of 88,270,194 customers as of December 31, 2008; of whom 85,650,733 subscribed to GSM services and 2,619,461 use the Telemedia Services either for voice and/or broadband access delivered through DSL. Bharti Airtel is the largest wireless service provider in the country, based on the number of subscribers as of December 31, 2008. They also offer an integrated suite of telecom solutions to their enterprise customers, in addition to providing long distance connectivity both nationally and internationally. They have recently forayed into media by launching their DTH and IPTV Services. All these services are rendered under a unified brand "Airtel". The company also deploys, owns and manages passive infrastructure pertaining to telecom operations under its subsidiary Bharti Infratel Limited. Bharti Infratel owns 42% of Indus Towers Limited. Bharti Infratel and Indus Towers are the two top providers of passive infrastructure services in India. Company shares are listed on The Stock Exchange, Mumbai (BSE) and The National Stock Exchange of India Limited (NSE).

Our vision & promise

By 2015 airtel will be the most loved brand, enriching the lives of millions. " Enriching lives means putting the customer at the heart of everything we do. We will meet their needs based on our deep understanding of their ambitions, wherever they are. By having this focus we will enrich our own lives and those of our other key stakeholders. Only then will we be thought of as exciting, innovation, on their side and a truly world class company."

We will meet the mobile communication needs of our customers through : Error-free service delivery. Innovative products and services. Cost efficiency.

We will always put our customers first. We will always trust and respect each other. We will respect our associates as we respect each other. We will work together through a process of continuous improvement .








Bharti Airtel provides Prepaid and postpaid services for both mobile phones and fixed land lines users The company charges Nominal tariff rates to its users in all the circles where it provides service Bharti Airtel also provides gprs services to the gprs unabled handsets Airtel also provides Wireless solution in blackberry and iphone As far as advertising is concerned, the company has Shah rukh khan the brand ambassador

Bharti Airtel has an easy to access Airtel usb modem for an instant internet connection

It provides with a wide range of prepaid and postpaid plans available as per customer needs

The company has most widespread network in the country

Data card is available from Rs.49 to Rs.999/month (installation cost Rs.2999)

Airtel digital TV is a satellite television service

It offers additional benefit like TV recorder Tariffs from Rs.145 to Rs.345/month (Installation Rs.1490 Rs.4290)

Kareena Kapoor and Saif Ali Khan are the brand ambassadors which has helped a lot to the company to generate sales and have a competitive stand in the DTH market

1st ISP (Internet service provider) in India It provides end to end telecom solutions to corporate customers National and international long distance services to carriers (A company authorized by regulatory agencies to operate a telecommunication system)


STRENGTHS More than 130mn customers base Business has access to knowledge and technology as it holds strategic alliance with Sony-Ericsson, Nokia and Sing Tel Pan India presence Strong financials with increase in NP by 22%+ and Sales by 4.5%+ for FY Mar, 2010 WEAKNESS Outsourcing of telecom and IT networks, IT infrastructure, last mile connectivity of broadband operations, BPO services, Inter city optic fibre cables Risk associated with Zain acquisition like lower profitability, political and regulatory risks OPPURTUNITIES

Bharti infratel can cut down cost in vast untapped rural and semi urban areas Current tale - density is 52%, still low as compared to developed economies Increase in subscribers base and global wide spread with Bharti Zain acquisition THREATS Bharti Airtel is India centric Intense competition among Indian markets Changing pace of global telecommunication industry which impacted the decision of purchase of MTN indirectly opening doors for the rivals (Reliance comm.)

Bharti Airtel Ltd. - Research Center

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Half yearly Annual Balance sheet


P&L Cash flow Dividend Share holding


Capital structures Ratio

(Rs crore)

Balance sheet
Mar ' 10 Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06

Sources of funds
Owner's fund

Mar ' 10

Mar ' 09

Mar ' 08

Mar ' 07

Mar ' 06

Equity share capital






Share application money






Preference share capital

Reserves & surplus






Loan funds
Secured loans 39.43 51.73 52.42 266.45 2,863.37

Unsecured loans












Uses of funds
Fixed assets

Gross block






Less : revaluation reserve






Less : accumulated depreciation






Net block






Capital work-in-progress












Net current assets

Current assets, loans & advances 9,225.08 10,466.63 8,439.38 5,406.81 3,338.88

Less : current liabilities & provisions






Total net current assets






Miscellaneous expenses not written





Mar ' 10

Mar ' 09

Mar ' 08

Mar ' 07

Mar ' 06







Book value of unquoted investments 11,619.95 9,898.56 9,379.62 580.43 476.52

Market value of quoted investments






Contingent liabilities






Number of equity sharesoutstanding (Lacs)






Profit loss account

Mar ' 10 Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06

Operating income 35,609.54 34,048.32 25,761.11 17,851.61 11,259.12

Material consumed 313.63 281.65 33.85 22.08 67.40

Manufacturing expenses






Personnel expenses






Selling expenses






Adminstrative expenses






Expenses capitalised



Cost of sales






Operating profit






Other recurring income






Mar ' 10

Mar ' 09

Mar ' 08

Mar ' 07

Mar ' 06

Adjusted PBDIT






Financial expenses












Other write offs






Adjusted PBT






Tax charges






Adjusted PAT






Non recurring items






Other non cash adjustments






Reported net profit






Earnigs before appropriation






Equity dividend



Preference dividend

Dividend tax



Retained earnings






Cash flow
Mar ' 10 Profit before tax Net cashflow-operating activity Net cash used in investing activity Netcash used in fin. activity 10,699.25 12,692.63 -10,601.66 -2,539.32 Mar ' 09 8,161.54 11,853.15 -10,894.38 -672.00 Mar ' 08 6,972.54 10,459.85 -11,648.41 898.03 Mar ' 07 4,601.37 8,107.95 -7,975.05 340.13 Mar ' 06 2,285.80 4,547.20 -5,000.26 376.35

Mar ' 10 Net inc/dec in cash and equivlnt Cash and equivalnt begin of year Cash and equivalnt end of year -448.35 789.88 341.53

Mar ' 09 286.77 503.31 790.08

Mar ' 08 -290.53 793.47 502.94

Mar ' 07 473.03 307.43 780.46

Mar ' 06 -76.71 384.14 307.43

Mar ' 10 Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06

Per share ratios

Adjusted EPS (Rs) 22.40 48.93 34.08 21.20 10.60

Adjusted cash EPS (Rs)






Reported EPS (Rs)






Reported cash EPS (Rs)






Dividend per share



Operating profit per share (Rs)






Book value (excl rev res) per share (Rs)






Book value (incl rev res) per share (Rs.)






Net operating income per share (Rs)






Free reserves per share (Rs)






Profitability ratios
Operating margin (%) 39.08 38.74 41.37 40.65 35.86

Gross profit margin (%)






Net profit margin (%)






Adjusted cash margin (%)






Mar ' 10

Mar ' 09

Mar ' 08

Mar ' 07

Mar ' 06

Adjusted return on net worth (%)






Reported return on net worth (%)






Return on long term funds (%)






Leverage ratios
Long term debt / Equity 0.11 0.25 0.30 0.43 0.61

Total debt/equity






Owners fund as % of total source






Fixed assets turnover ratio






Liquidity ratios
Current ratio 0.71 0.72 0.58 0.48 0.45

Current ratio (inc. st loans)






Quick ratio






Inventory turnover ratio






Payout ratios
Dividend payout ratio (net profit) 4.71 5.73 -

Dividend payout ratio (cash profit)



Earning retention ratio






Cash earnings retention ratio






Coverage ratios
Adjusted cash flow time total debt 0.39 0.60 0.66 0.81 1.34

Financial charges coverage ratio






Mar ' 10

Mar ' 09

Mar ' 08

Mar ' 07

Mar ' 06

Fin. charges cov.ratio (post tax)






Component ratios
Material cost component (% earnings) 0.78 0.84 0.16 0.29 0.47

Selling cost Component






Exports as percent of total sales






Import comp. in raw mat. consumed

Long term assets / total Assets






Bonus component in equity capital (%)







History Vodafone Essar, usually referred to simply as Vodafone, is a cellular operator in India that covers 23 telecom circles in India. It was formerly known as Hutchison Essar. It is based in Mumbai. Vodafone Essar is the Indian subsidiary of Vodafone Group 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. The company now has operations across the country with over 113.77 million 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 bothprepaid 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 Essar will launch third-generation (3G) services in the country in the January-March quarter of 2011 and plans to spend up to $500 million within two years on its 3G networks.

Company profile Vodafone Essar in India is a subsidiary of Vodafone Group Plc and commenced operations in 1994 when its predecessor Hutchison Telecom acquired the cellular license for Mumbai. Vodafone Essar now has operations in 22 circles with over 65.92 million customers**. The company is a joint venture of Essar Communication Holdings Ltd and the UK-based Vodafone Group. Vodafone has partnered with the Essar Group as their principal joint venture partner for the Indian market. They are in the business of cellular telephony. Over the years, Vodafone Essar, under the Hutch brand, has been named the Most Respected Telecom Company, the Best Mobile Service in the country and the Most Creative and Most Effective Advertiser of the Year. Vodafone is the worlds leading international mobile communications company. It currently has equity interests in 27 countries across 5 continents and 40 partner networks with over 289 million proportionate customers worldwide. Vodafone has partnered with the Essar Group as its principal joint venture partner for the Indian market. Essar Global Limited (EGL) is a diversified business group spanning the manufacturing and services sectors of Steel, Energy, Power, Communications, Shipping & Logistics, and Projects. The group has operations and investments in India, Canada, USA, Africa, the Middle East, the Caribbean and South East Asia and employs 30,000 people worldwide. Vodafone Essar Ltd provides services like 2G, which are based on 1800 Mhz and 900Mhz GSM digital technology. They offers voice and data services. In addition, they offers postpaid connections activation, prepaid SIM cards and recharge coupons sale, service activation/deactivation, postpaid tariff plan change, customer query resolution, prepaid/postpaid SIM card replacement and upgradation, mobile number change, and information on and subscription of value added services through stores.

Vision:Our Vision is to be the worlds mobile communication leader enriching customers lives, helping
individuals, businesses and communities be more connected in a mobile world.


The Vodafone mission is to be the communications leader in an increasingly connected world

enriching customers lives, helping individuals, businesses and communities is more connected by delivering their total communication needs.

Strengths Strong international presence and brand recognition Well-defined cost reduction initiatives, managed outsourcing Stable operating profit The India operations is backed by its huge expertise and diversified geographical portfolio. Sharing of network infrastructure Leading presence in India Brand value built by delivering a superior, consistent and differentiated customer experience. Vodafones customer strategy endeavors to ensure that customers needs are at the core of all products and services. Weakness Benefits of investment in technology are not realized Little penetration in rural market Have not entered broadband services, smart phones segment Advertising campaigns do not have the emotional connect to the lower income classes and rural customers Perception of customers in lower segment that Vodafone is a costly brand

Opportunities Focus on capturing rural sector through cost reductions improving returns Research and development of new mobile technologies Mobile Broadband Improve accessibility to wide range of customers

Vodafone can offer voice, messaging, data and fixed broadband services through multiple solutions and supporting technologies to deliver on its total communications strategy. The advancements in 3G networks and download speeds, handset capabilities and the mobilisation of internet services, could contribute to an acceleration of data services usage growth. Threats

Existing competitive market Entry of many new players in immediate future Government regulations Change in technology Change in consumer preference Adverse macroeconomic conditions like recession and economic slow down


PRODUCTS Post-paid Services Pre-paid Services Magic Box Handsets World Calling Cards World Calling Card from Vodafone is a Pre-paid long distance calling card that one can use with their Vodafone Prepaid and Post-paid mobile phones to make ISD & STD calls. Home Calling Cards Vodafone Home Calling Card is a Pre-paid calling card that allows one to make calls from landlines, PCOs & mobile phones from over 100 countries. And helps save up to 90% as compared to International Roaming charges. So talk more, spend less and always stay connected. Handy phone Vodafone Handy phone is a landline thats loaded with all the features of a cell phone - including low call rates. And Vodafone Handy phone isnt that expensive either. One can make it theirs for Rs 1999. SERVICES

Tunes & downloads Entertainment Devotional Sports News & Updates Call Management Services Astrology Finance Travel Mail, messaging & more Dial in Services Bill Info RE-BRANDING STRATEGIES Hutch to Vodafone

REVIEW OF LITERATURE Girija (1998), in its article Socioeconomic Implications of Telecommunications Liberalization: India in the International Context says that Telecommunications restructuring have evolved differently in Asia and Latin America. While Asian governments have moved cautiously in bringing changes to the sector, Latin American nations have implemented radical ownership and market transformations. The Indian telecommunications reform falls in between these two general regional trends. The choice of a high component of competition, increased private participation, and no privatization of the national carrier set conditions that will trigger unique socioeconomic effects. This article identifies and highlights the likely implications of the Indian reform on key economic and social issues, such as the cost of services, cross-subsidies, network interconnection, private investments, universal services, employment, and the possible rise of an information-intensive economy. It does so by comparing and contrasting the

Indian experience with dominant reform strategies elsewhere in the developing world. T.H. Chowdary (1999) discusses how Telecom reform, or demonopolization, in India has been bungled. Shaped by legislation dating back to the colonial era and post Second World War socialist policies, by the mid-1980s India realized that its poor telecommunications infrastructure and service needed reform. At the heart of the problem lay the monopoly by the governments Department of Telecommunications (DOT) in equipment, networks and services. The National Telecom Policy 1994 spelt out decent objectives for reform but tragically its implementation was entrusted to the DOT. This created an untenable situation in which the DOT became policymaker, licenser, regulator, operator and also arbitrator in disputes between itself and licensed competitors. He discusses the question: Why did India get it so wrong? and What India should do now? Anand (1999), in his article named India's economic policy reforms says that India was embarked on economic reforms in July 1991, in the wake of a balance of payments crisis. In this article, an attempt is made to review two books and a set of World Bank reports concerning the progress of these reforms. Issues concerning economic policy, impact of the reforms on poverty, sectoral issues relating to agriculture, industry and infrastructure are briefly discussed. As reforms enter a more difficult phase, several challenges remain. Some of this fall under the economic agenda'' of measures needed to maintain economic growth; others can be termed the development agenda'' of improving human development. Progress with regard to the former is not sufficient to produce results concerning the latter. Bhattacharya (2000) constructs a vision of the Indian telecommunication sector for the year 2020. The paper aims at isolating agents of change based on international experiences and situates India in the development continuum. The agents of change have been broadly categorized into economic structure, competition policy and technology. Das (2000), in her paper described the Liberalisation of the Indian telecommunications services which started in mid nineties with no change in the existing public monopoly structure, entirely controlled by Department of Telecommunications (DoT). In order to evaluate any proposed industry structure, it is essential to analyse the production technology of DoT so as to determine the rationale of liberalisation and sustainability of competition. Accordingly, the researcher estimates a frontier multi-product cost function for DoT, where the cost function has been duly modified to account for the production technology of a public monopoly. The study finds that although DoT displays high allocation inefficiency, it is still a natural monopoly with very high degree of sub additively of cost of production. This study implies that the choice of any reform policy should consider the trade-off between the loss of scale and scope economies and cost saving from the reduction in inefficiency of the incumbent monopoly in the event of competition. Rao (2000), in her article named Internet service providers in India, provides a broad view of the role of an Internet service provider (ISP) and the factors to be considered before entering the ISP market. Describes the Internet/ISP scene within India and discusses the configuration of local, regional and national level ISPs, and the supporting infrastructure. She also identifies the various success factors. The global Internet scenario is discussed regarding the phases of the Internet in India, i.e. pre and post

commercialization. The main players are described: ERNET, NICNET, STPI, VSNL, MTNL, Satyam Infoway and Bharti-BT. The financial and legal implications are highlighted in the Indian context. Many companies entered the nascent ISP business in India due to deregulation. Building local content, foreknowledge of new Internet technologies, connecting issues, competitiveness, etc. would help in their sustainability. She concludes that though many companies entered the nascent ISP businesses in India due to deregulation, many of them are unlikely to survive in the longer term. Vrmani (2000) estimates the contribution of telecommunication (or telecom) services to aggregate economic growth in India. Estimated contribution is distinguished between public and private sectors to highlight the impact of telecom privatization on economic growth. Knowledge of policy determinants of demand of telecom services is shown to be essential to enhance growth contribution of telecom services. Using a recent sample survey data from Karnataka State in South India, price and income determinants of demand for telecom services are estimated by capacity of telephone exchanges Estimation results offer evidence for significant negative own price elasticity and positive income elasticity of demand for telecom services. Narinder (2004), in his article Enhancing Developmental Opportunities by Promoting ICT Use: Vision for Rural India talks about the foremost benefits of Information and Communication Technologies (ICTs) in developing countries that can be helpful in improving governance including public safety and eradication of illiteracy. The benefits of ICTs have not reached the masses in India due to lack of ICT infrastructure, particularly in rural areas, where two-third of the population of the country lives. Even in cities and suburban areas, use of ICTs is not popular due to lack of awareness to its use, computer illiteracy, and absence of practical applications. India is the largest country in South Asia, with a population of over one billion people and its telecom sector is presently experiencing fast growth phases. However telephony penetration in villages is less than two percent of the rural population and about 15 percent of the villages are still without any telephony service. Universal access to ICTs in rural areas has been planned and is being implemented through Public Tele Info Centers having voice data and video, as majority of villagers in India cannot afford a separate home connection. Illiteracy in rural areas is as high as 40 percent and in some tribal belts hardly about 20 percent people are literate. There are 35 million children in age group of 611 years, who are out of school and one out of four drops out during primary classes. Education and training, therefore, must be given the top priority if advantages of ICTs are to be harnessed. Indian economy is agriculture based and employs maximum workforce. Improvement in agriculture productivity can help in reducing rural poverty. Adoption of ICT in agriculture will play an increasingly important role in crop production and natural resource management. The other critical factor is technological challenges for universal access to ICTs to bring down the network access cost. Nikam, Ganesh, Tamizhchelvan (2004), analyses that changing face of India in bridging the digital device. He reiterated - India lives in villages said the Father of the Nation, Mahatma Gandhi. With 1,000 million people and 180 million households, India is one of the biggest growing economies in the world. With the advent of the Information, Communication and Technology (ICT) revolution, India and its villages are slowly but

steadily getting connected to the cities of the nation and the world beyond. Owing to the late Rajiv Gandhi, India is now a powerful knowledge economy, and though India may have been slow to start, it certainly has caught up with the West and is ahead in important respects. The Government, the corporate sector, NGOs and educational institutions have supported rural development by encouraging digital libraries, e-business, e-learning and e-governance. The aim of this paper is to touch upon and highlight some of the areas where, by using ICT, the masses have been reached in this way. A follow-up paper will outline collections of significant cultural material which, once national IT strategies are fully achieved, could form part of a digitally preserved national heritage collection. Dey (2004), in her article talks about the discussions between the Federal Communications Commission (FCC) and communications policy makers and regulators in other countries and how they have gleaned several clusters of issues where further research would directly benefit them. Recently, there have been two notable shifts. First, as the acceptance of the competition model over the monopoly model for telecommunications markets takes deep effect in regulators all over the world, questions regarding process and procedure for regulation are becoming ever more urgent. This paper discusses current questions regarding decision making, enforcement, and understanding consumer issues that arise often in the FCC's discussions with other regulators. Second, technological change is potentially shifting market definitions. In the FCC's discussion with other regulators over the last two years, the overlap of wireline telecom, wireless telecom and cable television has become more pronounced. Singh (2005), in his article The role of technology in the emergence of the information society in India describes the role that information and communication technologies are playing for Indian society to educate them formally or informally which is ultimately helping India to emerge as an information society. Though India has a huge population, the illiteracy rate is also huge in this country. The paper has taken an approach to find the historical situation and present the prevailing scenario as well as the change that are taking place with the application of ICT to the advantage of the society in different areas including daily life. India is making all out efforts to be counted among the developed nations of the world. The article also describes the considerable attention India is taking for application of technology, development of infrastructure and human resource for meeting national needs. Basically India is building an information society. Technology has helped society to cut across the traditional boundaries for getting converted into an emerging information society. The study concludes that The Indian software and services industry has significantly helped to boost the Indian economy. In IT-enabled services too, India has been clearly perceived to be the dominant hub. The Indian software sector is being recognized as the single largest contributor to incremental market capitalization in India but the sector is still small in terms of contribution to GDP, especially when compared to other large sectors in the economy like agriculture and manufacturing. Similarly, the telecommunication sector has contributed a lot but still has a considerable way to go. The paper also enforces that comparisons of Indias telecommunication statistics with those of developed and other emerging economies show that the country is still far behind its contemporaries. Mr. Banka (2006) gives an overview of the mergers and acquisitions in the

telecommunication industry. According to him Governments decision to raise the foreign investment limit to 74% is expected to spur fresh rounds of mergers and takeovers in India. He foresees a sector that represents humongous opportunity waiting to be tapped by Indian and foreign conglomerates. Thomas (2007), in his article describes the contribution made by telecommunications in India by the state and civil society to public service, this article aims to identify the states initial reluctance to recognize telecommunications provision as a basic need as against the robust tradition of public service aligned to the postal services and finds hope in the renewal of public service telecommunications via the Right to Information movement. The article follows the methodology of studying the history of telecommunications approach that is conversant with the political economy tradition. It uses archival sources, personal correspondence, and published information as its research material. The findings of the paper suggests that public service in telecommunication is a relatively new concept in the annals of Indian telecommunications and that a deregulated environment along with the Right to Information movement holds significant hope for making public service telecommunications a real alternative. The article provides a reflexive, critical account of public service telecommunications in India and suggests that it can be strengthened by learning gained from the continual renewal of public service ideals and action by the postal services and a people-based demand model linked to the Right to Information Movement. All studies done by the researcher suggests that the right to information movement has contributed to the revitalisation of participatory democracy in India and to a strengthening of public service telecommunications. Cygnus Business Consulting & Research Pvt. Ltd. (2008), in its Quarterly Performance Analysis of Companies (April-June 2008) has analysed the Indian telecom industry in the awake of recent global recession and its overall impact on the Indian economy. The analysis is done in the background of wake of global recession and rising inflation. Cygnus estimates, the Indian telecom industry is expected to maintain the growth trajectory in the next quarter as well. With almost 5-6m subscribers are being added every month, and the country is witnessing wild momentum in the telecom industry. Maheshwari (July-September 2008), in her report analysed the Indian telecom industry and ascertain that Indian telecommunications has been zooming up the growth curve at an mounting pace, and India is has surpassed US to become the second largest wireless network in the world. This growing subscriber base is basically created by tapping into rural India, which is an emerging market for the industry. The estimate for the next five to ten years is that the rural market will form 40 % of the subscriber base. The study has analysed the human resource management process of the industry, and specially the latest trends of recruitment of this massively growing industry. Anderson (2008), in his single executive interview titled Developing a route to market strategy for mobile communications in rural India An interview with Gurdeep Singh, Operations Director, Uttar Pradesh, Hutch India suggests that managers need to go beyond traditional approaches to serving the poor, and innovate by taking into account the unique institutional context of developing markets. His practical implication says that

the experience of Hutchison Essar in India provides some important lessons for mobile network operators (MNOs) and other firms in other developing markets who are hoping to serve the rural poor: Hutchison has recognized the value of corporate and noncorporate partners. The company has proactively established relationships with individual entrepreneurs, and has provided has provided development support to other partners such as distributors. The company has recognized the value of leveraging existing local institutions, and has seen gaps in local infrastructure or missing services as potential opportunities rather than barriers to growth. The company has seen the rural market as an opportunity not just an obligation to be served because of universal service obligations. Also this article demonstrates that MNOs can deliver availability and affordability to achieve increased individual or household penetration through business model innovation. Mani (2008) addresses a number of issues arising from the growth of telecom services in India since the mid-1990s. It also discusses a number of spillover effects for the rest of the economy and one of the more important effects is the potential to develop a major manufacturing hub in the country for telecom equipment and for downstream industries such as semiconductor devices. The telecom industry in India could slowly become an example of the service sector acting as a fillip to the growth of the manufacturing sector. A beginning towards this has been made. The formation of a Telecom Equipment Export Forum and the announcement of the Indian Semiconductor Policy 2007 are steps in this direction. Success crucially depends on the response of the private sector to these incentives. Given the importance that a regulatory agency can play in this crafting, no effort should be lost in strengthening the powers of the TRAI. The benefits to the Indian economy from having both a strong services and manufacturing segments in the telecom sector cannot be undermined. Narayana (2008) estimates the contribution of telecommunication (or telecom) services to aggregate economic growth in India. Estimated contribution is distinguished between public and private sectors to highlight the impact of telecom privatization on economic growth. Knowledge of policy determinants of demand of telecom services is shown to be essential to enhance growth contribution of telecom services. Using a recent sample survey data from Karnataka State in South India, price and income determinants of demand for telecom services are estimated by capacity of telephone exchanges. Estimation results offer evidence for significant negative own price elasticity and positive income elasticity of demand for telecom services. Sharma (2009) deals with the major challenges faced by Indias telecom equipment manufacturing sector, which lags behind telecom services. Only 35% of the total demand for telecom equipment in the country is met by domestic production. This is not favourable to long-term sustained growth of the telecom sector. The country is also far behind in R&D spending when compared to other leading countries. India needs to see an increase in R&D investment, industry-academia-government partnership, better quality doctoral education and incentives to entrepreneurs for start-ups in telecom equipment manufacturing. In 2006-07, 65% of the total consumption of equipment was met through imports. This trend has far-reaching implications for the economy and should not be allowed to continue for long. In a country like India which has a problem of massive

unemployment, the manufacturing sector should be promoted to create more employment opportunities. Shah (February, 2009), has analysed Indian telecom industry and studied the sector keeping in mind three companies; namely Bharti, R.Comm and idea in the background of recent global meltdown. The study suggests that though there is no sign of slowdown in this sector, but surely a strong turmoil is going on in the industry. The study states that the sector is fairly immune from the current economic downturn & does provide a good defensive bet in medium term. With the help of newer technologies, wireless penetration is expected to increase in the near future, which is basically fuelling the growth of the sector. While the 3G / Broadband adoption would ensure long term growth momentum, the article has thoroughly investigated about the intense competitive scenario, pricing pressure, high capital intensity & substantial regulatory uncertainties currently faced by the industry. The article has also described the cause of being relatively safe of this industry. The causes described by Shah are increasing rural coverage, rising affordability, declining handset/subscription costs, substantially low tariffs & established brand/distribution. However, the study also cautions the telecom industry that a steeper economic slowdown could start impacting the subscriber usage patterns as well as operator capital investments & thereby could substantially restrict revenue growth rates going forward.