Telecom sector
- 1. TELECOM SECTOR Presented by:- Anupam Tiwari Gaurav Shanker Mathur Navdeep Bishnoi Shoaib Rizvi Abhishek Malla Gaurav Gupta
- 2. Overview Of Telecom Industry Indian Telecom sector, like any other industrial sector in the country, has gone through many phases of growth and diversification. Starting from telegraphic and telephonic systems in the 19th century, the field of telephonic communication has now expanded to make use of advanced technologies like GSM, CDMA, and WLL to the great 3G Technology in mobile phones. Day by day, both the Public Players and the Private Players are putting in their resources and efforts to improve the telecommunication technology so as to give the maximum to their customers.
- 3. Telecommunication industry can be divided into Fixed line Telephony Public Players - Subscribers Private Players ◦ Subscribers Mobile Telephony Public Players - Subscribers Private Players ◦ Subscribers
- 4. Market shares of Public Players in Indian Fixed Line Telephony
- 5. Market shares of Public Players in Indian mobile telephony
- 6. Investment The Indian telecom sector can be broadly classified into Fixed Line Telephony and mobile telephony. The major players of the telecom sector are experiencing a fierce competition in both the segments. The major players like BSNL, MTNL, VSNL in the fixed line and Airtel, Hutch, Idea, Tata, Reliance in the mobile segment are coming up with new tariffs and discount schemes to gain the competitive advantage. The Public Players and the Private Players share the fixed line and the mobile segments. Currently the Public Players have more than 60% of the market share.
- 7. Market shares of public and Private Players Both fixed line and mobile segments serve the basic needs of local calls, long distance calls and the international calls, with the provision of broadband services in the fixed line segment and GPRS in the mobile arena. Traditional telephones have been replaced by the codeless and the wireless instruments. Mobile phone providers have also come up with GPRS- enabled multimedia messaging, Internet surfing, and mobile-commerce..
- 8. Along with improvement in telecom services, there is also an improvement in manufacturing. In the beginning, there were only the Siemens handsets in India but now a whole series of new handsets, such as Nokia's latest N- series, Sony Ericsson's W-series, Motorola's PDA phones, etc. have come up. Touch screen and advanced technological handsets are gaining popularity. Radio services have also been incorporated in the mobile handsets, along with other applications like high storage memory, multimedia applications, multimedia games, MP3 Players, video generators, Camera's, etc..
- 9. The leading cellular service providers have the following number of subscribers: • Reliance Tata Airtel MTNL BSNL Hutch Idea Spice BPL Aircel
- 10. Performance The Indian telecom industry has witnessed a significant upswing and is presently on a high speed growth path, enjoying a growth rate of ~45 % p.a., among the highest in the World. India currently has ~550 million telecom subscribers, translating to a tele-density of ~46%. According to Business Monitor International, India is currently adding 8-10 million mobile subscribers every month. It is estimated that by 2012, around half the country's population will own a mobile phone. This would translate into 612 million mobile subscribers, accounting for a tele-density of around 51%. Meanwhile, authorities believe current broadband subscriptions are ~20 million and internet subscriptions are ~40 million.
- 11. Strengths Huge Customer potential ◦ Tele density still being 48% and rural tele-density 21%. ◦ The broadband subscribers grew from 0.18 million in 2005 to6.2 million as on 30 April 2009 and about 7.98 million, at the end of the December 2009. High return on Investment ◦ Easier to create economies of scale thereby increasing return on investment Liberalization efforts by Govt. ◦ The share of private sector in total telephone connections is now 82.33% as per the latest statistics available for December 2009 as against a meager 5% in 1999.
- 12. Weakness Poor Telecommunication Infrastructure ◦ Result : Large number of call drops. Late adopters of New Technology ◦ India will be among the last countries in the world to get access to 3G technology. Some estimates suggest that nearly 132 countries across the world already have 3G technology and mobile services in one form or the other. Most competitive market ◦ 10 to 12 companies offer mobile services in most parts of India, globally, the average is 4. A market strongly regulated by Government.
- 13. Opportunities Value added Services (VAS) ◦ The mobile value added services include, text or SMS, menu based services, downloading of music or ringtones, mobile TV, videos, streaming, sophisticated m- commerce applications etc. ◦ Mobile banking, Mobile Ticketing etc Boost to Telecom Manufacturing Companies ◦ Production of telecom equipments in value terms has increased from Rs. 412700 million (2007-08) to Rs.488000 million during 2008- 09 and expected to increase to Rs. 575840
- 14. Threats Telecommunication Policies ◦ e.g. Trai's 2G direction affecting new players most notably Tata Teleservices, Norway’s Telenor and Essar-owned Loop Telecom ◦ Renewal of 2G license on the basis of market rates of 3G auctions Declining ARPU (average Revenue per user) ◦ E.g. price wars like per-second billing which is deflating revenues and making sure the ‘survival of the fittest’ Partiality on the part of the Govt. ◦ E.g. Allowing 3G service in a PSU (MTNL,BSNL) before auctioning to Private Sector .
- 15. Future Prospects Given the exciting times ahead, the sector is a huge employment generator, likely to generate over ~3 lakh new jobs over the coming 5 years. There is a huge demand for qualified and skilled professionals with technical knowledge and hands on experience. In order to fulfill their rapid growth plans, players lure talent with handsome rewards. Suitably skilled candidates can expect a significant premium salary even at the starting level, due to the challenges the industry is facing in terms of finding and recruiting proper talent. Industry experts believe that the talent crunch in this sector will push salaries even further than the current 15% hike.
- 16. Future Prospects Given the exciting times ahead, the sector is a huge employment generator, likely to generate over ~3 lakh new jobs over the coming 5 years. There is a huge demand for qualified and skilled professionals with technical knowledge and hands on experience. In order to fulfill their rapid growth plans, players lure talent with handsome rewards. Suitably skilled candidates can expect a significant premium salary even at the starting level, due to the challenges the industry is facing in terms of finding and recruiting proper talent. Industry experts believe that the talent crunch in this sector will push salaries even further than the current 15% hike.