TELECOM SECTOR IN INDIA

One of the fastest growing sector (15%) , contribution in bridging urban rural gap. Regulated by TRAI
2010 Total revenue generated Rs. 144600 Crores 2011 Rs. 166168 Crores

Indian telecom sector contributing to GDP

Subscriber base

5.7%

6% (anticipated)

742.12 million

875 million

Market Share as on April 2011

Bharti Telecom

Reliance
Vodafone BSNL Idea Tata Aircel Others

Source : TRAI

BHARTI AIRTEL LIMITED

Airtel, is an Indian telecommunications company that operates in 19 countries across South Asia, Africa and the Channel Islands. Sunil Bharti Mittal founded the Bharti Group. Statistics of 2010 Total revenue - $9.290 billion Operating income - $ 2.313 billion Profit - $2.079 biliion Employees - 25401

HISTORY
In 1986, Sunil Bharti Mittal incorporated Bharti Telecom Limited (BTL) and his company became the first in India to offer push-button telephones, establishing the basis of Bharti Enterprises. FIRST MOVER ADVANTAGE Bharti Enterprises went public in 2002, and the company was listed on Bombay Stock Exchange and National Stock Exchange of India. In 2003, the cellular phone operations were rebranded under the single Airtel brand.

STAKE
4.40%

32.15%

63.45%
Bharti Enterprises SingTel Vodafone

Mobile network
3G wireless

SERVICES
DTH landline

Satellite television

broadband

 Airtel is the fifth largest telecom operator in the world with over 207.8 million subscribers across 19 countries at the end of 2010. It is the largest cellular service provider in India, with over 164.61 million subscribers at the end of 2011 April. Hence, establishing itself as an international brand thereby creating goodwill

 On May 18, 2010, 3G spectrum auction was completed and Airtel will have to pay the Indian government 12,295 crores(US$2.74 billion) for spectrum in 13 circles, the most amount spent by an operator in this auction. Airtel won 3G licences in 13 telecom circles of India.

23 July 2011 Mobile call rates in the country are risen with other operators likely to follow the footsteps of Bharti Airtel, which increased tariffs (of Advantage and Freedom plans) by 20 per cent for pre-paid subscribers in six circles.

RURAL INDIA AND AIRTEL

Rural market penetration remains low but Airtel has a high rural market share of 25% among all the telecom operations in india. Today, over 50% of our business comes from rural areas and going forward, a major percentage of new acquisitions are expected from the rural market spokesperson of Airtel

 Sanjay Gupta, CMO said that company will focus on three key services for Rural India enabling Livelihood, Education and Healthcare. Gupta called mobile connectivity in Rural India the next Harit Kranti (Green Revolution). Forayed into the rural telecom market with the setting up of 4,000 Airtel Service Centres (ASCs) in the remotest villages of Maharashtra and Goa telecom circles Feb 2009 Airtel is investing in a hub-and-spoke model, so that wherever there is a matchbox being sold, the company will have a presence. Theyre planning to cover 2 million outlets.

 Bharti Airtel and Ericsson have continued their strategic partnership with a USD 1.3 billion network expansion contract that will see the deployment of a converged network to expand coverage in rural India. Launched micro financing agreements in collaboration with Nokia and SKS Micro-finance. Under these partnerships, Bharti provides subsidized tariffs and SIM cards to rural users, Nokia provides subsidized handsets, and SKS offers micro financing. Formed a joint venture with the Indian Farmers Fertilizer Cooperative Limited (IFFCO). Its joint venture, IFFCO Kisan Sanchar, uses IFFCO's wide rural presence (present in 80% of Indian villages) and appeal among the rural agricultural community to market and distribute Bharti's products.

INTRODUCTION
State owned enterprise incorporated in 2000 87.1 million subscribers as of April 2011, and the largest land line telephone provider in India. BSNL is India's oldest and largest communication service provider (CSP). It has footprints throughout India except for the metropolitan cities of Mumbai and New Delhi, which are managed by Mahanagar Telephone Nigam Limited (MTNL). Statistics of 2009-10 Total revenue-$3.43 billion Profit-$-0.41 billion Employees-299840

HISTORY
BSNL then known as Department of Telecom had been a near monopoly during the socialist period of the Indian economy. During this period, BSNL was the only telecom service provider in the country MTNL was present only in Mumbai and New Delhi. The corporation tasted competition for the first time after the liberalisation of Indian economy in 1991. Faced with stiff competition from the private telecom service providers, BSNL has subsequently tried to increase efficiencies itself.

Universal Telecom Services (cdma) Cellular Mobile Telephone Services (gsm)

IPTV

SERVICES
3G WLL-CDMA Telephone Services

Intelligent network

internet

3G
While it did not participate in the 3G auction, BSNL paid the Indian government Rs. 10,187 crores for 3G spectrum in all 20 circles it operates in which is equivalent to the highest bid in the respective service areas. BSNL has the largest 3G coverage in India covering about 700 cities and also has widest 2G coverage in every remote areas of the country. BSNL 3G services usually cover not only the main town/city but also the adjoining suburbs and rural areas as well.

GROWTH PLANS
Growth Plan : BSNL has continued its growth story ever since its formation & has reached a customer base of 81.49 million as on 31 st March,2009 from 28.11 million as on 31 st March,2001. BSNL further plans to increase its customer base to 160 Million by March, 2014. Broadband services : The shift in demand from voice to data has revolutionized the very nature of the network. BSNL is poised to cash on this opportunity and has planned for extensive expansion of the Broadband services. The Broadband customer base of 3.56 Million customer in March'2009 is planned to be increased to 16.00 million by March 2014.

Value Added Services : BSNL is focussing on provision of value added services/features to attract high end customers and to double its revenues from VAS

DOWNFALL OF BSNL
Ever since the arrival of private telecom service providers after the liberalization of Indian economy in 1991, BSNL has been desperately looking for measures to keep its customer base intact. The company has not been able to grow in line with the market and has been steadily losing its market share. Adding to its woes, the recently introduced Mobile Number Portability (MNP) has hit hard at BSNL and MTNL. BSNL's subscriber base declined by 131,581 customers while MTNL lost nearly 5,869 customers after MNP was introduced. In an effort to arrest the erosion in their user base, both the companies have come up with measures to address customer grievances and improve service quality apart from additional incentives to distributors and retailers. BSNL had posted a loss of about Rs 3,000 crore last year.

BSNL AND MTNL MERGER

The Department of Telecommunications (DoT) has revived a proposal for the merger of BSNL and MTNL to synergise their business operations across the country. The talks for merger of BSNL and MTNL had been going on for around three years, but due to different organisational structure and MTNL being a listed company, the talks were abandoned. There was a proposal to list BSNL, but following opposition from employees, the plan was shelved.

CURRENT SCENARIO
Launch of MNP (Mobile Number Portability) on January, 2011, special Tariff offer for its 2G and 3G prepaid & post paid customers. The advantage of MNP offer is to provide the best talk time to customers moving to BSNL. No Port in charges shall be levied to customers moving to BSNL. Besides this the SIM card for 2G/3G shall be provided free of cost, along with an additional talk value of Rs. 100 for prepaid customers. The post paid customers moving to BSNL shall also have 50% rebate on the first month charges besides free SIM and waiver of Port in charge.

 India's state-owned BSNL is expected to be given a grant of Rs 2,395 crore (US$520 million) to expand its WiMAX network into less profitable rural areas. The company had said that it would not continue expanding its network into lossmaking areas without tax payer funded support.

IDEA CELLULAR
Idea is an Aditya Birla Group company. Multinational corporation operating in 26 countries. Founded by Kumar Mangalam Birla in 1995 Statistics of 2010-11 Total revenue-$3.43 billion Operating income-$642.09 million Profit-$188.35 million Employees-6481

HISTORY
After its inception , the year of 2000 saw the mergers of Birla , Tata and AT & T(Batata) and was later branded as Idea. In 2005, AT & T sold its investment and Tatas also followed its footsteps to pursue its independent telecom business. Axiata bought 15% of stake whereas Aditya Group sold 20% to Providence Equity Partners.

3G SERVICE
Launch of its 'Gold Standard' 3G services started from MP & Chhattisgarh, Gujarat and HP. Idea has set up 'Experience Kiosks' to provide a flavour of the services that customers can opt for. These will be available to all users at select 'My Idea' stores. Idea's 3G services will enable users to avail Video Conferencing, IdeaMall Application Store, Mobile TV, Video on Demand, and high-speed Internet Browsing. Paid Rs. 5768.59 crores for the spectrum - lowest paid 80% revenue comes from 3G services

CURRENT ISSUES
India's Idea Cellular says that a potential fine of Rs. 250 Crore (US$56.3 milion) has been suspended by the Telecom Disputes Settlement and Appellate Tribunal (TDSAT). The fine had been imposed by the Department of Telecom (DoT) on Idea for holding 5 overlapping licenses, which the company was ordered to surrender.

 USA based private equity investor, Providence Equity Partners is reported to be considering selling its 10% stake in Indian mobile network operator, Idea Cellular. Based on stock market valuations, this is worth around US$594 million.