Growth In Growth In Telecom SectorTelecom Sector

TopTopicsics

The Journey so far!The Journey so far!

Where it stands today? Where it stands today? Article discussionArticle discussion

What Next?What Next?

HistHistoryory

1854 : A regular, separate department was opened, when telegraph facilities were thrown open to the public.

January 1985 : Two separate dept for the Posts and the Telecom were created.

1986 : Mahanagar Telephone Nigam Ltd. (MTNL) was created.

HisHisttoryory

January 1997 : Telecom Regulatory Authority of India (TRAI) was formed.

1st October 2000 : Dept created BSNL, a new entity to operate services in different parts of the country as a PSU.

2004 : The policy for Broadband was defined with the aim to increase the internet penetration in India.

Telecom India DailyTM

Market Market ChangesChanges

1985: First mobile telephone service started on non-commercial basis in Delhi.

1995: GSM entered India. 1st cell phone-call was made by Mobile joint venture between Telstra & B.K. Modi group. 1st call was made by Jyoti Basu.

1996: Tata Teleservices was the first to launch CDMA mobile services in India with the Andhra Pradesh circle.

The sector was liberalized and private mobile operators began their journey.

New New InitiativesInitiatives Reasons for high growth are changes or initiatives taken

in the recent years.

1. New Licenses given by Government in 2008 added up in ongoing competition – 120 new licenses awarded.

2. Lowest tarrifs in the world with local calls reaching 10 paise/min and STD tarrifs dropping to 50 paise/min from high tarrifs of 17 Rs/min in 1994

3. Reduction in Handset prices has made mobile a common tool.

TopTopicsics

The Journey so far!The Journey so far!

Where it stands today?Where it stands today?

What Next?What Next?

Article Article DiscussionDiscussion

Expected single-digit growth during the quarter ended Expected single-digit growth during the quarter ended Dec 2010.Dec 2010.

These postings were on the basis of following criteria'sThese postings were on the basis of following criteria's•Net subscribersNet subscribers•Stable tariff scenarioStable tariff scenario

Article Article DiscussionDiscussion In Dec 2010 for the growth in revenue there were the

following expected figures : Idea by 6% RCOM& Airtel by 3-4%

Less fluctuations were expected for Dec’2010.

Operating margin of the following is expected to grow RCOM by a tad 10 basis points (bps) to 32.7% Idea’s to remain at 24% Airtel at 33.4% with 30bps dip in margin

Article Article DiscussionDiscussion Oct & Nov 2010,net subscriber additions were strong for Oct & Nov 2010,net subscriber additions were strong for

Bharti as compared to peersBharti as compared to peers

Airtel’s net subscriber base against previous year jumped to Airtel’s net subscriber base against previous year jumped to 30% 30%

RCOM & Idea had a 20% increase in the net subscriber base.RCOM & Idea had a 20% increase in the net subscriber base.

A report says that the 3G launch is further expected to reduce A report says that the 3G launch is further expected to reduce the drop in the avg. revenue per minute(ARPU).the drop in the avg. revenue per minute(ARPU).

Article Article DiscussionDiscussion

Mobile Network Portability(MNP) is likely to have a Mobile Network Portability(MNP) is likely to have a impact on the profitability of telecom, but it is impact on the profitability of telecom, but it is expected to be restricted to a certain limitexpected to be restricted to a certain limit.

Existing Existing OperatorsOperators

Service ProvidersService Providers TechnologyTechnology

Bharat Sanchar Nigam Limited (BSNL) GSM, CDMA & Fixed Line

Bharti Airtel Limited (Airtel) GSM & Fixed Line

Reliance Communications Limited (RCOM) GSM, CDMA & Fixed Line

Vodafone Essar Limited (Vodafone-Essar) GSM

Idea Cellular Limited (Idea) GSM

Tata Teleservices Limited (TTSL) GSM, CDMA & Fixed Line

Tata Teleservices Maharashtra Limited (TTML) CDMA & Fixed Line

Mahanagar Telephone Nigam Limited (MTNL) GSM, CDMA & Fixed Line

Aircel Cellular Limited (Aircel) GSM

Reliance Telecom GSM

Loop Mobile Limited (Loop mobile) GSM

HFCL Infotel Limited (HFCL) CDMA & Fixed Line

Telecom India DailyTM

New New PlayersPlayersNameName Operation StartedOperation Started

Datacom Solutions Pvt. Ltd. In process

Etisalat DB Telecom Pvt. Ltd. In process

Loop Telecom Private Ltd. T.N., Orissa, Karnataka, Kerala

Reliance Communications Limited GSM service launched in all new licensed areas.

S Tel Ltd. In process

Sistema Shyam Teleservices T. N., Kerala, Kolkata, West Bengal and Bihar.

Tata Teleservices LimitedChennai, Karnataka, Kerala, Orissa, T.N.,

Andhra Pradesh

Unitech Wireless Pvt. Ltd. In process

Mobile Mobile TariffsTariffs0.23

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Telecom India DailyTM

Present Present StatusStatus (as on (as on 31.12.2010)31.12.2010)

Customer Base in million

Wire line Customers : 32.72 GSM Customers : 37.71 Total Customers : 70.43 Broadband customers: 1.81 Internet Customers : 4.67

Telecom India DailyTM

TopTopicsics

The Journey so far!The Journey so far!

Where it stands today? Where it stands today?

What Next?What Next?

Innovation Innovation will be will be keykey

New Innovative ideas and services will hold the key

Convergence of Mobile, fixed line & internet will give rise to new services

Mobile will see new technologies like 3G, 4G and WiMAX, IPTV, VOIPWiMAX, IPTV, VOIP

Positive trends in Positive trends in Cellular ServicesCellular Services

Focus on future aspectsFocus on future aspects

Consistent GrowthConsistent Growth

Advanced technologyAdvanced technology

Negative trends in Negative trends in Cellular ServicesCellular Services

Increasing No of competitorsIncreasing No of competitors

Lack of reliabilityLack of reliability

Inappropriate Business planInappropriate Business plan

ThaThanks!nks!

SourcesTelecom India Daily (internal research)……..open internet

Prepared by…Prepared by…

Yuvraj ZalaYuvraj Zala

(KBSCMR)(KBSCMR)