Indian Wireless Communication:

Paradigm, Opportunities and

Challengeby

Prof. Dr. M. S. Sutaone-

Dean-Alumni and International Affairs,

E and TC deptt., COEP-5

E-mail: dean.alumni@coep.ac.in

. AGENDA

� Today’s Telecom Environment

� Small/Medium Business Telecommunications Trends

� What’s Possible in the Next Decade ?

� Technology Challenges

� Indian Scenario: Paradigm and Opportunities

What Do We See Today ?

� Two very clear growth factors

BROADBAND73M US Homes

65% Penetration

MOBILITY280M US Mobile Phones

90% Penetration

Consumer Trends – New Generation, New Usages . . . Driving Data

Usage

� “Connected” generation born with Internet and mobile� A global communication experience: instant information access,

multimedia content creation and sharing

� A continuum of service usage: SMS, Instant Messaging, Email, Online Gaming, Blogs, File Sharing

� Key for the individual social identity: personal blogs, video, picture and music file sharing

� Fast evolving preferences following fashion trends

� New network applications changing everyone’s life� Blogs: 70M in 2005 – 120M in 2007

� Social Networking: Facebook 26M – 90% growth in 2007

� Banking Transactions: negligible in 2006 – 8M in 2008

� Telecom part of “green” & “socially responsible” culture

What Are We Doing on the Internet ?

�76% of P2Ptraffic is video Non-P2P (client-

server) applications

� MySpace

� Facebook

� YouTube

� iTunes

� Napster

� Gaming

How Much Data Is There ?

consumes more bandwidth today than the entire Internet did in 2000

It took 200 years to fill the Library of Congress

� 57 million documents, 29 million books, 12 million photos

� Worldwide, an equal amount of digital info is generated

almost 100 times per day

* University of California at Berkeley study** IDC – The Diverse and Exploding Digital Universe

One Exabyte = 1 quintillion bytes = 1,152,921,504,606,846,976 bytes (or 1B GB)

� 12 Exabytes = Sum of all human produced information (audio, video, text/books) through

1999 (of which 1.5 exabytes was created in 1999 alone) *

� Worldwide Information Tracker - http://www.emc.com/leadership/digital-universe/expanding-digital-universe.htm

shows 431 Exabytes created and replicated worldwide since 1/1/2008 (to 12/1/08 10pm) **

� That’s 1.2 Exabytes a day !!

How Fast Are Data Speeds Growing Across Fixed and Mobile Networks ?

� Wireline Access Technologies� Speeds: +50% per year

� Faster connections: more consumption

� Broadband/home: +20% over the last few years and will be boosted by HD video

10 Kbps

100 Kbps

1 Mbps

10 Mbps

100 Mbps

1000 Mbps

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

CDMA

GPRSUMTS

Today

Mobile Broadband

CDMA 2000

1xEVDORev. A

1xEVDORev. 0

1xEVDORev. B

UMB

LTE

WiMAX FDD

EDGEHSDPA

HSPA+

‘Peak rates are the maximum under a perfect RF condition. Actual rates may

be much lower depending on RF conditions’

Peak rate doubles every year and is increasing !

WiMAX TDD

Wireless Access Technologies

� Speeds: 100% per year !

� An even faster, cheaper

bandwidth capability

� Ubiquitous broadband coverage

Wireless Phone Explosion

We’re almost at the cell phone ‘saturation’ point . . . But there’s still lots of device growth as consumers swap older technology with new 3G/4G phones

280M Phones90% Penetration

0

50

100

150

200

250

300

Subs (M)

2005 2006 2007 2008 2009 2010 2011 2012

North American Subscribers

1G/2G/2.5G 3G (CDMA2k/WCDMA)

Based on CDG, GSMA and internal estimates

US Subscribers

The Handset as the Enabler of New Usage

� Experimenting With New Applications

� Increasing The Time Spent on Communication Experiences

iPhoneMobile

Video

Social Network Access

Facebook YouTubeGoogle

Maps

% of users 30.9% 49.7% 20.0% 30.4% 36.0%

All phones 4.6% 4.0% 1.5% 1.0% 2.6%

Source: MMetrics, March 2008

iPhone Internet Music eMail

% of time spent 12.1% 11.9% 10.4%

All phones 2.4% 2.5% 2.8%

Source: iSuppli, April 2008

Smart devices are key to high growth in applications and revenue from new business models

Watching a single half hour video on the Internet consumes as much bandwidth as sending 200 emails a

day for an entire year.

Technology

Other Key Technology Trends

Trends

Integrated Circuits x2 in density/speed every 18-24 months

Photonics x2 in transmission capacity every year

Storage x2 in storage density every 9 months

Displays x2 in pixels every 2 years

Wireless x2 in peak data rate every year

Software x2 in operating system size every 2 years

Key Small/Medium Business (SMB) Needs

Ubiquitous connectivity

Wireless enablement

Other hosted

applications

Local Phone

LD

Broadband

Internet

Access

� T1 / DSL/ Fiber / Ethernet

� 1.5 Mbps / 10 Mbps / 100 Mbps /

1 Gbps / 10 Gbps / 100 Gbps

(Bandwidth needs of SMBs are

gorwing rapidly)

� Multi-location VPNs, LAN emulation

� Hosted Messaging, Security, Back-up

Services, Hosted Website, Video

conferencing, Teleworker Support

� WiFi/3G/4G, Fixed-Mobile

Convergence, Dual Mode Phones

� One stop for all voice needs,

Hosted VoIP, unlimited calling plans

Fixed Mobile Convergence

� Cellular –WiFi Convergence

� Ability for phone to work in cellular mode (outside) and WiFi mode (inside)

� Cellular Extension

� Ability for mobile phone to be part of PBX/Centrex group – to leverage extension dialing, call park/retrieve, call pick-up, etc.

� Seamless Handoff

� Ability to start a call in wireless or WiFi mode, and transition inside/outside without the call dropping

� Femto Cell

� WiFi like device that works at the same macro cellular spectrum in the home

Ubiquitous Broadband – At Home, At The Office, and On The Road

…optimized for any device…

Ultra High Bandwidth Services…

Handsets Vehicles

� Transport-centric services

� Fully interactive experiences

� Media/content portability

Gaming/Tablet Connected Home

…enabling a seamless service experience

� Rich multiscreen entertainment experience

Paradigm Shift to Wireless

Communication in India

• Pros and cons of Wireless systems

– Advantages• Convenience

• Quick access regardless one’s position

• Low cost in setup and maintaining

– Disadvantages• Limited frequency spectrum

• Complex technologies

• Quality of signals

• Power supply for the small portable units

• Health Effects on human being / society

Technical Challenges in Wireless

Communications

•17

•• NoiseNoise

•• SNRSNR

•• Multipath fadingMultipath fading

•• InterferenceInterference

•• Limited PowerLimited Power

•• Frequency selective fadingFrequency selective fading

•• Doppler shiftDoppler shift

Technical Opportunities

•18

••Robust Multiplexing and Multiple Access Technique : Robust Multiplexing and Multiple Access Technique :

OFDM/OFDMAOFDM/OFDMA

••Intelligent user allocation : Intelligent user allocation : Dynamic Resource Allocation and PacketDynamic Resource Allocation and Packet

SchedulingScheduling

••Integrated Optimization:Integrated Optimization: Cross Layer OptimizationCross Layer Optimization

••Link Adaptation : Link Adaptation : Adaptive Modulation and CodingAdaptive Modulation and Coding

••Spatial Multiplexing: Spatial Multiplexing: MIMOMIMO

••Performance Optimization:Performance Optimization: CrossCross--layer layer DesignDesign

••Cognitive RadioCognitive Radio

Indian Telecom Industry – A Lucrative Option

•In recent years, the Indian telecom industry has witnessed phenomenal growth. A conducive business environment,

favourable demographic outlook and the political stability enjoyed by the country have contributed to the growth of the

industry. India achieved the distinction of having the world's lowest call rates (2–3 US cents), the fastest sale of million

mobile phones (1 week), the world's cheapest mobile handset (USD 19) and the world's most affordable colour phone (USD

31).

•Indian Telecom Industry

� One of the fastest growing cellular markets

in the world in terms of number of

subscriber additions – 19.35 million in 3

months (April to June 2011)

� Expected to reach total subscriber base of

about 500 million by 2011 (i.e., more than

one phone for every household)

� Annual growth rate of the telecom

subscribers – 54.7 percent (2011-12)

� More GSM subscribers than fixed-line

subscribers

Indian Telecom Industry – Facts

� Total telecom subscribers – 225.21 million

(June 2011)

� Tele density – 39.86 percent (June 2011)

� Number of new mobile subscribers added

every month – 7.34 million (June 2011)

� Telecom equipment market – USD 27,100

million (2011–12)

� Handset market – USD 5,750 million (2011–

12)

Number of mobile subscriber will propel the total subscriber base

to 500 million by 2011

225.21

206140.3

98.47653

19.9

5.17.0

9.1

12.8

18.3

0

50

100

150

200

250

2002–03 2003–04 2004–05 2005–06 2006–07 2007–08

(As of June

2007)

Subsc

ribers

(in

millio

n)

0

4

8

12

16

20

24

Tele

de

nsity

(in

perc

ent)

Telecom Subscriber Base Teledensity

� The telecom subscriber base has witnessed an

explosive growth; the additions in the current year

registered a growth of approximately 47 percent over

the previous year.

� The subscriber base registered a CAGR of 40.4

percent for 2002–03 to 2006–07.

Telecom Subscriber Base and Teledensity in India

Market Share* of Wireless** Operators (As of June 2010

Airtel

23%

Reliance

Communications

17%

TTSL

9%

BSNL

17%

Others

8%

Hutch

17%

Idea

9%

The state-owned BSNL was the second largest service provider after Bharti

Airtel (23 percent) in the Indian wireless telecom market with a market

share of approximately 19 percent for the year ending March 2007.

•** Includes GSM, CDMA and WLL-F services•* In terms of Subscriber Base

•GMPCS services were launched in India

in 1999. These services allow a

subscriber to communicate from any

point on earth through a handheld

terminal. Moreover, the telephone

number remains unchanged,

irrespective of the subscriber’s

location.

Various other services emerged by leveraging the telecom services

industry

•Public Mobile Radio Trunked Services

•PMRTS have not grown to their expected

potential in India. The high licence fee leaves a

very thin margin for services providers; thereby,

inhibiting its growth. About 31,000 subscribers

are currently availing this service in India from

12 different operators.

•In 1995, radio paging services emerged as a

promising segment in India. However, this

segment could not compete with cellular

services in general and SMS technology in

particular, and is currently shrinking. At

present, only four radio paging service

providers are present in the Indian market.

•Very Small Aperture Terminals (VSAT)

•The market for VSAT services increased by

5.73 percent during the quarter ending in

December 2006, and the segment had a total

subscriber base of 55,070. HCL Comnet is the

largest of the eight players functioning in the

market.

•GMPCS*

• Radio Paging

•Other Telecom Services

•* Global Mobile Personal Communication by Satellite

The emergence of private players and new technologies have provided a

strong impetus to the growth of Internet and broadband services. The quality

and penetration of these services have undergone changes, with significant

improvement in the telecom infrastructure. The Internet subscriber base

registered a CAGR of 60 percent for the period 1997–98 to 2010–11.

Others, 14.0%

MTNL, 19.0%

BSNL, 45.2%

Bharti Airtel,

6.8%

Reliance,

6.1%

Sify, 8.9%

Market Share of Top Five Internet Service Providers (as of quarter ending March 2010)

0.140.28

0.95

3.043.42

3.64

4.55

5.55

6.94

9.27

0

2

4

6

8

10

19

97

–9

8

19

98

–9

9

19

99

–0

0

20

00

–0

1

20

01

–0

2

20

03

–0

3

20

03

–0

4

20

04

–0

5

20

05

–0

6

20

06

–0

7

Inte

rnet

Su

bs

cri

be

rs (

In m

illio

n)

Internet Subscribers: 1998–2007

BSNL and MTNL caters to more than two-thirds of Internet subscribers in

India.

Private players are catching up fast due to increased penetration of Internet

and broadband services in India.

The telecom market will experience high penetration of Internet services

with the support from government policies and introduction of novel

technologies in India.

•Broadband services to drive Internet penetration in India

India had 2.52 million broadband connections at the end of June 2011.

Indian telecom handset market booming along with mobile

services industry

1,6101,966

3,231

4,750

0

1,000

2,000

3,000

4,000

5,000

2003–04 2004–05 2005–06 2006–07

US

D M

illio

n

• Mobile Handsets Market in India: 2004–10� The Indian handset market grew at a phenomenal rate in

2006 with the sale of approximately 30–35 million handsets.

It is estimated that by 2011, sales of mobile handsets will

reach 150 million units.

� Competitive pricing has triggered the growth of coloured

handsets, which accounted for 65 percent of the market in

2006; whereas, the share of monochrome handsets has

declined to 35 percent.

� Mobile phones are available at prices as low as USD 28–35.

� Camera phones currently occupy 15 percent of the sales

volume.

ZTE

4%

Nokia

53%

Motorola

11%

LG

11%

Sony Ericsson

6%

Huaw ei

1%Haier

1%

Samsung

6%

Others

7%

•The CDMA category is growing faster than the GSM

category. It captured 25 percent of the market

volume in 2005–06 as against a 20.5 percent share in

the previous year.

•Market Share of GSM and CDMA Handset Manufacturers: 2006–07

•Overall, Nokia has a market share of 53 percent; it

dominates the GSM mobile handsets with a market

share of approximately 73 percent.

•LG dominates in the CDMA handsets market with a

market share of 60 percent.

� World’s largest democracy

� Independent judiciary

� Skilled and competitive labour force

� Fifth largest telecom network in the world; second largest among the emerging economies after

China

� On an average, about 6–7 million new users added per month, making India the world’s fastest

growing wireless services market

� Liberal Foreign Investment Regime–FDI limit increased from 49 percent to 74 percent; the rural

telecom equipment market is also open to large investments

� Among the countries offering the highest rates of return on investment

� The large untapped potential in India’s rural markets–1.9 percent teledensity in rural markets as

compared to the national level of 18 percent

� Expected to become the second largest telecom market by 2010

� The government promoting telecom manufacturing by providing tax sops and establishing telecom

specific Special Economic Zones

� Fully repatriable dividend income and capital invested in telecom equipment manufacturing

•India: An Ideal Destination for Investments in Telecom Sector

Indian Telecom Industry Framework

• Indian Government Bodies

• Independent Bodies

Wireless Planning and Coordination (WPC)

Department of Telecommunications

Telecom Commission

Group on Telecom and IT (GoT-IT)

Telecom Regulatory Authority of India (TRAI)

Telecom Disputes Settlement and Appellate

Tribunal (TDSAT)

Handles spectrum allocation and management

DoT – Licensee and frequency management for telecom

Exclusive policy making body of DoT

Handles ad hoc issues of the telecom industry

Independent regulatory body

Telecom disputes settlement body

•Regulatory Framework provides level playing field for all operators

They formulate various policies and pass laws to regulate the telecom industry in India.

They undertake various research activities and monitor the quality of service provided in the Indian telecom industry. They also provide various recommendations to improve the status of telecom operations in India.

The Department of telecommunications (Government of India) is the main

governing body for the industry.

Telephone Regulatory Authority of India (TRAI) assists the Government of

India (GoI) to take timely decisions and introduce new technologies in the

country.

Go-ahead to the CDMA technology

•INDIA

Private players were allowed in Value Added Services

National Telecom Policy

(NTP) was formulated

1992

1994

1997

Independent regulator, TRAI, was established

NTP-99 led to migration from high-cost fixed

license fee to low-cost revenue sharing regime

1999

2000

2002

BSNL was established

by DoT

ILD services was opened to competition

Internet telephony initiated

Reduction of licence fees

2003

Calling Party Pays (CPP) was

implemented

Unified Access Licensing

(UASL) regime was

introduced

Reference Interconnect order was issued

2004

Intra-circle merger guidelines were established

Broadband policy 2004

was formulated—targeting 20

million subscribers by

2010

2005

FDI limit was increased from

49 to 74 percent

Attempted to boost Rural telephony

2006

Number portability was proposed (pending)

Decision on 3G services (awaited)

2007

•Department of Telecommunication (DoT) is the main body formulating laws and various regulations for the Indian telecom industry.

•Various important regulations and laws have been passed in the Indian telecom industry post-liberalisation era

•ILD – International Long Distance

Vodafone purchased stake in Hutch from Hong Kong's Hutchison

Telecom International for USD 11.08 billion.

Telekom Malaysia acquired a 49 percent stake in Spice

Communications for USD 179 million.

Maxis Communications acquired a 74 percent stake in Aircel for USD

1.08 billion.

Ericsson to design, plan, deploy and manage Bharti Airtel network and facilitate their expansion in the rural areas, under a USD 2 billion

contract.

116 129

680

521

100

300

500

700

2003–04 2004–05 2005–06 2006–07

FD

I (U

SD

millio

n)

Recent Deals in Telecom Sector

FDI in Telecom Sector

The Indian telecom industry has always attracted foreign

investors. In fact, the cumulative FDI inflow, during the August

1991 to March 2007 period, in the telecommunication sector

amounted to USD 3,892 million. It is the third largest sector to

attract FDI in India in the post-liberalisation era.

FDI calculation takes into account radio paging, cellular mobile

and basic telephone services in the telecommunication sector.

•FDI and other M&A activities increasing in number

Reliance Communications Limited has sold a five percent equity share capital of its subsidiary Reliance

Telecom Infrastructure Limited to international investors across the US, Europe and Asia. The deal was

worth USD 337.5 million.

The Indian telecom industry has a 74 percent FDI limit in the

telecom services segment.

The GoI has permitted 100 percent FDI in manufacturing of

telecom equipment in India.

•Major trends in the telecom sector is increasing M&A activity, de-regulation of telecom policies and growing interest of international investors.

Basic Services Operators

BSNL

MTNL

•Major Players in different segments of Indian telecom industry

Reliance

TTSL

GSM Services Operators

Airtel

Vodafone

Idea

Reliance

TTSL

BSNL

CDMA Services Operators

Reliance

Internet Services Operators

BSNL

MTNL

Reliance

TTSL

BSNL

Airtel

•TTSL – Tata Teleservices Ltd.

•MOBILE SERVICES

•BSNL – Bharat Sanchar Nigam Ltd.

•MTNL – Mahanagar Telecom Nigam Ltd.

Emerging technologies – 3G and WiMax to assist in penetration of

telecom services in India

• WiMAX has been one of the most significant developments in wireless communication in the recent

past. Since this mode of communication provides network access in inaccessible locations at a speed

of more than 4 Mbps, it is expected to be a major factor in driving telecom services in India,

especially wireless services. Thus, it will lead to the increased use of telecom services, Internet,

value-added services and enterprise services. WiMAX is expected to accelerate economic growth and

assist in providing better education, healthcare and entertainment services.

� It is estimated that India will have 13 million WiMAX subscribers by 2012.

� Aircel is the pioneer in WiMAX technology in India.

� The state-owned player, BSNL, aims to connect 74,000 villages through WiMAX.

� Bharti, Reliance and VSNL have acquired licenses in the 3.3GHz range to utilise the opportunities

offered by this domain.

• The Indian government plans to auction the spectrum for 3G services by inviting bids from

domestic as well as foreign players, and creating a competitive environment that offers

better services to consumers. Therefore, the 3G spectrum is among the major investment

opportunities and growth drivers of the telecom industry.

� The immense potential for 3G is reflected by the 30–40 percent annual growth in Value-

Added Services.

� Cell phone manufacturers are striving to develop USD 100 priced 3G handsets for the Indian

market.

� India expects to replicate its 2G growth in 3G services.

THANKS!