History Of INDIAN

Telecommunications
● 1851 – First operational lines were laid by government near Calcutta.
● 1881 – Telephone service introduced in INDIA.
● 1883 – Merger with the Postal system.
● 1923 – Formation of Indian Radio Telegraph Company (IRT).
● 1932 – Merger of ETC and IRT into the Indian Radio and Cable Communication
Company (IRCC).
● 1947 – Nationalization of all Foreign Telecommuniations companies to form the
Posts, Telephone and Telegraph (PTT), a monopoly run by the governments
Ministry of communication.
● 1985 – Department of Telecommunications (DOT) established, an exclusive
provider of domestic and long distance service that would be its own regulator
(separate from the postal system).
● 1986 – Conversion of DOT into two wholly government – owned companies:
a) Videsh Sanchar Nigam Limited VSNL for international telecommuniations
b) Mahanagar telephone Nigam Limited for service in Metropolian cities.
● 1997 – Telecom Regulatory Authority of India created.
● 1999 – Cellular services is launched in India . New National Telecom policy is
adopted.
● 2000+ – DoT becomes a corporation BSNL, CAGR of around 75%, FDI :74%
(2005).
● 2007-09 – world's lowest call rates, fastest growth in number of subscribers,
fastest sale of million mobiles in week, world's cheapsest mobile and most
affordable colour phones.
INDIA'S Position in Telecom Sector
● India is Second largest market in Asia after
China, Japan & South Korea.
th
●
Indian Telecom network is 8 largest in the
nd
world and 2 largest among emerging
economies.
● Contribution of Telecom sector in terms of
revenue is 2.1% of GDP as compared to
2.8% of emerging economies.
Classificaition Of Telecom Sector
1) Fixed Line Telephony
● Current market size of Rs.30164 crore with 43 million lines.
● BSNL and MTNL account for 90% revenue for basic services
● Private sector available in 18 sectors and collectively account
for 10% of the revenue.
● Private sector offers high end services like leased lines, ISDN,
videoconferencing as a result ARPU (average revenue per user
is more for private players).
Classificaition Of Telecom Sector
2) Mobile Telephony
● There are 25 private companies providing cellular services in 19
telecom sectors and 4 metro cities, covering 1500 towns across
the country.
● Presently, there are five private service operator in each area,
and an state operator.
● Almost 80% of cellular subscriber base belongs to the prepaid
segment.
● DOT has allowed cellular companies to buy rivals within the
same operating circle provided there combined market share did
not exceed 67 percent.
● Previously, they were only allowed to buy companies outside
there circle.
Classificaition Of Telecom Sector
3) Internet
●
Internet telephony has been allowed officially from 1st april 2002.
● There is no restriction on the number of internet comapnies and
more than 186 are operational.
● The growing demand of corporates for applications such as
electronic commerce, internet leased lines, ISDN, VPN etc is
driving the growth of internet services market.
● Internet has become easily accesible at any place in INDIA with
cyber cafes.
Subscribers growth rate vs. tariff
Lowest Tariff
Telephone connections
Telecom Subscribers
Handset Manufaturer Market
Share
Market share
 Market Share
BSNL – Incubent service provider and world's 7th largest
telecomunications company providing comprehensive range of
services like GSM mobile, wireline, Internet, Broadband, career
services, VSAT, VOIP services etc....
MTNL – State
S owned operator covering the cities of Mumbai & Delhi
providing both fixed and mobile services.

BHARTI AIRTEL – Integrated operator with presence in all

segments, leads the mobile segment in country.

RELIANCE COMMUNICATIONS – Largest player in India in CDMA

segment, plans a GSM network.
TATA TELESERVICES – Integrated operator with VSNL, presence in
all segments providing CDMA services in 20 circles
 Market Share
VODAFONE – An integrated service provider which has a 10% stake
in Bharti Telecom and Represents the largest foreign investment in
the telecom sector services in India.

IDEA – It operates in eight telecom “circles”, or regions, in Westren

India, and has recieved additional GSM license to expand its
network into three circles in Eastern India – the First phase of major
expansion plan that it intends to fund through an IPO, according to
parent company Aditya Birla Group
Backup Industries
 Contributions to GDP
● Contribution of Indian Telecom sector to growth of India's
economy is immense.
● It is directly contributing more than 2.1 per cent GDP of the
country.
● It has a multiplier effect on growth because of connecting the
people and business around.
●
Indian telecom industry is 2nd largest in world with a total
wireless subscribe base of 435 million targeted to estimated 771
million by 2013.
● India has cheapest mobile rates in world.
● “Connecting rural India” for both voice and data connectivity is
the main target of India's telecom industry.
 Role of TRAI

MISSION : “To ensure that the interests of consumers are protected and at
the same time to nurture the conditions for growth of
telecommunications, broadcasting and cable services in a
manner and at a pace which will enable india to play a leading
role in the emerging global information society”.
ROLE OF TRAI
● Fair and transparent policy environment to promote a level playing
field and facilitates fair competition.
● To isssue a large number of regulations, order and directives to deal
with issues coming before it.
● To provide required direction for evolution of Indian Telecom market
from a Government owned monopoly to a multi operator multi service
open competitive market.
 Role of TRAI
Recommendatory Functions:
● Need and timing for introduction of new service providers.
● Terms and conditions of license to a service provider.
● Revocation of license for non-compliance of terms and
conditions of license.
● Measures to facilitate competition and promote efficiency in the
operation to facilitate growth in industry.
● Technological imrovement in service by service providers.
● Inspection of type of equipment used by service provider.
● Efficient management of available spectrum.
 Role of TRAI
Other Functions:
● Levy fees and other charges as dete-
rmined by regulations.
● Perform administrative functions as
entrusted to it by central govt or as
per TRAI act.
● Notify in official Gazette the service
rates and message rates within and
outside India.
● Ensure compliance of Universal
service obligaiton (USO).
● Regulate arrangements for sharing
of revenues amongst service
providers.
 Major Investments
● The Russian government is likely to pick up equity amounting to US$
670 million in Sistemea Shyam Teleservices Ltd (SSTL), a joint venture
between Russian based telecom major Sistema and shyam group in
INDIA.
● Norway based telecom operator Telenor has bought 60 per cent stake
in UNITECH wireless for US$ 1.23 billion.
● Japanese major NTT DoCoMo acquired a 27.31 per cent equity capital
of TaTa teleservices for about US$ 2.6 billion in November 2008.
● BSNL, India's leading telecom compnay in terms of revenues is
putting US$ 1.16 billion in it's WiMax project.
● Vodafone Essar will invest US$ 6 billion over next three years in a bid
to increase its mobile subscriber base from 40 million at present to 100
million.
● Telecom operator Aircel, which launched GSM service in Bangalore
plans to invest US$ 220.58 million over the next year to setup base stn.
FDI investments in the Telecom
Sector in India
 SWOT – Strenghts Weakness
Opportunities Threats
STRENGHTS-
● Stable economic growth.
● Large market potential.
● Large talent pool.
● Government initiatives.
● Decreasing call rates.
● Low lablur costs.
● Numerous BPOs and KPOs flourishing in India.
● Low teledensity offers huge future potential.
● Policies are in place to safeguard the interests of service providers, as
well as those of customers.
 SWOT – Strenghts Weakness
Opportunities Threats

WEAKNESS -
● Huge implementation costs.
● Customer retention.
● Increased competition.
● Infrastructure uprgrade.
● Cost recovery.
● Bill reconciliation is slow.
● Query processing is slow.
 SWOT – Strenghts Weakness
Opportunities Threats
OPPORTUNINTIES -
● Rural density is less than 10% and overall teledenstity is 24%.
● Broadband penetration is just 0.25%, hence vast scope.
● BPO business is growing fast : so telecom can ride on it.
● Value added services like M-commerce, M-marketing, special
infromation, Ringtones etc. offers venues of additional revenues.
● As globalisation is increasing, more percentage of global
business for Indian telecom.
● Technologies like 3G, WiMax etc... will open up new frontier of
business.
 SWOT – Strenghts Weakness
Opportunities Threats
THREATS -
● Number of operators are increasing per circle hence more competititon
● Problem of limited spectrum availability and the issues of
interconnection charges between the private and state operators.
● It would be difficult to make inroads into semi-rural and rural areas
because of lack of infrastructure. Service providers have to incur a
huge initial fixed costs to make inroads into this market. Achieving
break-even in these conditions is difficult.
● Slow pace of reform process.
● Cost/Customer is high in rural areas.
● Spectrum a scare commodity.
● International bandwidth is costly.
SPECTRUM AUCTIONING
● India was also the early adopters
of spectrum allocation but its
success in service provision
was low and services were slow
to roll.
● Efficient use of spectrum
● Allocated to those who value it
the most, while generating
revenues for the government.
● Key challenge to design in a way
to foster competition.
● Two step process
 3G SPECTRUM AUCTION
● Government plans to auction the spectrum for 3G services by inviting
the bids from domestic, as well as foreign players and creating a
competitive environment that offers better services to consumers.
● The immense potential for 3G is reflected by the 30-40 per cent annual
growth in value added services.
● The global revenue for 3G is 60 per cent higher than that of other
services
● Cellphone manufacturers are striving to develop US$ 100-priced 3G
handsets for the Indian market
● India expects to replicate its 2G growth in 3G services.
● It offers voice capacity that is four to five times higher than that of 2G
services. Therefore, it is an ideal platform for low-cost cellular services
 Future Technology Trends
IP MULTIMEDIA SUBSYTEM -
● It's a generic architecture for offering multimedia and voice over IP
services, defined by 3rd Generation Partnership Project (3GPP).
● 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 such as push-to-talk,
push-to-view, push-to-video.
● These wide range of servies are both packet and circuit switched
networks.
● These services are created and delivered by a wide range of highly
distributed systems cooperating with each other.
 Future Technology Trends
HIGH SPEED DOWNLINK PACKET ACCESS -
● Packet based technology for W-CDMA dowlink.
● Data transmissions rate of 4 to 5 times of current 3G netwroks and 15
times that of GPRS.
● Introduction of shared channels for different users will guarantee that
channel resources are used efficiently in packet domain, and will be
less expensive for users than dedicated channels.
● It boosts dowlink speed from the current end user rate of 394 Kbps to a
maximum value according to standards of 14.4Mbps.
● Real life end-users speeds will be in range of 3-4Mbps.
 Future Technology Trends
IPTV (Internet Protocol Television)
● It delivers television programming to households via a broadband
connection using internet protocols.
● Requires a subscription and a IPTV settop box, and offers key
advantages over existing cable and satellite technologies.
● It is bundled with other services like Video on demand(VOD), voice
over ip or digital phone(VOIP) and Web Access collectively known as
Triple play.
● Promises more efficient streaming than present technologies.
● “custom view guides”.
● Full control over functionality such as rewind, fast forward etc..
● Real-time participation.
● Recieve web service notificaitons while watching IPTV.
 Future Technology Trends
4G or FOURTH GENERATION NETWORKS -
● Future technology for mobile and wireless communications.
●
It will be successor for the 3rd generation 3G network technology.
● Expexted to be seen around 2010 – 2015.
● High degree of personalizaiton and synchronization between various
user applicances, will be another driver.
● Fluid high Quality video and network reactivity.
● Fast response, high session rate, high capacity, low user charges and
rapid return on investments for operator.
 Conclusion
The INDIAN Telecom Service Provider industry is gearing for a
revolution. The customer is driving this revolution and will see
more unique and sophisticated offerings coming his way. The
3G which will pave the way for 3.5G, 3.75G and the next big
thing 4G and the VAS services will keep the customer asking
for more. The Rural areas which have remained untapped will
see an insurgence of services. Also the easing of regulations
by TRAI, the ease of spectrum licensing, the FDI influx will
make the telecom space in INDIA a must watch in coming
years.
 References
● IBEF Report 2007-08 : Tele-communication – MARKET &
OPPORTUNITIES.
● Cellular stastics – Cellular Operator Association of INDIA.
● www.trai.gov.in
● Article on Indian Cellular stastics May 2003.
● www.researchandmarkets.com
● Search Engines like google, YAHOO, ask etc....
THANk YOu