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NMIMS MPE 2010-12 Div-C

Telecom Equipment Manufacturingindustry

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Introduction

Communication always remains as an integral part of ourlife. Without expressions and communication, thedevelopment of the society in itself remains under completedarkness. Being a social being, communication plays a veryvital role and similarly the modes of communication. Themost vibrant and fast developing being telecommunications

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Introduction to Telecom EquipmentManufacturing Company:

y Telecom equipment manufacturing was exclusively reserved forgovernment enterprises until 1984. Till that time it was dominated by

Indian Telephone Industries (switching, transmission and terminalequipments).

y Hindustan Cables (cable products) and Hindustan Teleprinters (telexmachines/ modems). Thereafter, private entry was allowed in themanufacture of telephone instruments, cables, transmissionequipment, small switching exchanges developed by C-DoT andmanufacture of large exchanges.

y At present, private sector is allowed to manufacture the entire rangeof telecom equipments. Now there are a number of private players like

Himachal Futuristic, Global Telecommunication, Bharti Telecom,Tata Telecom, Shyam Telecom, etc. are serious players in the field.

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Introduction contd:

y Multinational companies such as Alcatel, Nortel, Ericssonand others control the switching and transmission devicesmarket which accounts for about 46% of the total domestictelecom equipment market.

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II)Telecom Equipment products

The country manufactures indigenously a large variety oftelecom equipments, i.e. communication and broadcastingequipment such as digital exchanges (EPABX, RAX, TAXand MAX), transmission equipment such as

HF/VHF/Microwave transreceivers, satellitecommunication terminals, optical fibre communicationequipment, troposcatter equipment, two-way radiocommunication equipment, etc.

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III) Indian Telephone Industries (ITI):

Indian Telephone Industries (ITI) is an Indian telecommunicationequipment manufacturing company. It manufactures a range ofequipments and instruments required for telecommunication, right

from switching and transmission equipment to individual handsets. It

was established in the year 1948 at Bangalore.

ITI is the largest domestic player in the telecom equipment industry. Ithas also announced a strategic alliance with MBT, for joint businessdevelopment and project management. These alliances cover

upcoming areas of Internet telephony, telecom billing and structuredcabling.

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IV) Market competitors and Market size

y The major types of telecom equipment produced in the country areJelly filled telecom cables, Switching and transmission equipment,which constitute more than 77% of the total telecom equipment

production.

y

The production of Switching and Transmission equipment stood at Rs.2500 Cr and contributed 23% of the total production. The telecomequipment market in India in the next five years is slated to be of theorder of Rs cr. 3,00,000

y This sector is expected to experience substantial investment in comingyears with the entry of more entrepreneurs in Basic telecom, Mobile

Satellite Communication services, Digital and several other ValueAdded services.

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Market competitors and Market size Contd..

There are various players in domestic market both public sector and privatesector who are manufacturing Telecom equipments :

Public Sector : Indian Telephone Industries

Hindustan Cables

Hindustan Tele-printers

Private Sector : Himachal Futuristic

Global Telecommunication

Bharti Telecom

Tata Telecom

There is significant competition observed from foreign playerslike Alcatel, Nortel, Ericsson

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Telecom/ISP Players

Major Telecom/ISP Players in India

Bharti Airtel Ltd.

Reliance Communications

Tata Tele Services

Tata Communications Idea Cellular

Vodafone Ltd

Loop Mobile.

Spice Communication Ltd

Sify Technologies

Tulip Telecom Hathway Cable & Datacom

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Growth Drivers

Mobile Subscriber Base & Penetration

Subscriber base

Year % growth

2007 56%

2008 49%2009 36%

2010 23%

2011 18%

2012 14%2013 11%

2014 8%2015 7%

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Growth Drivers

Broadband Access Technologies

Internet subscriber

Year % growth

2010 22%

2011 31%

2012 38%

2013 34%

2014 29%

2015 25%

Broadbandsubscriber

Year % growth

2010 42%2011 65%

2012 63%

2013 45%

2014 30%

2015 25%

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Growth Drivers

3GHandset

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Growth Drivers

Wireless Broadband Subscribers

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Growth Drivers

Age Profile

Increasing young population & rising income levels will drive the demand

for information & entertainment.

Source: CrisInfac, Census of India, NCAER, Global Insight.

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Growth Drivers

Population Growth

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Demand forecast

Telecom equipment sales

YearSlaes figure

(Rs.Cr) Growth Remark

2007-08 95,407 24%

2008-09 115,382 20%

2009-10 136,833 19%

2010-11 164,200 20% Projection

2011-12 197,040 20% Projection

2012-13 236,447 20% Projection

2013-14 283,737 20% Projection

2014-15 340,484 20% Projection

Phenomenal growth is expected to fuel the demand for telecom equipment worth

between Rs 320,000 Cr and Rs 470,000 Cr till 2015Source: Voice & Data

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Thank You