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Economic Environment of Business

Prof . Jaisree Desai

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28-09-2011

Telecom Industry

Presented BY:

Preetham.p

Abhinav

Ranjit kumar

Rahul sharma

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qHistory of Telecom Industry

qIndian Telecom Industry

qMarket Segments

qEnvironment in Telecom Industry

qMajor players in Indian Telecom industry

qInvestment

qOpportunities

qAdvantages of India

qMalaysia Telecom Industry

qTelecom market environment

qChallenges in India and Malaysia Telecom

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Rahul sharma

Ranjit Kumar

Abhinav

Preetham.p


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History of telecom industry

q Hydraulic semaphore systems were used as early as the 4thcentury BC.

q In 1792, Claude Chappe, a French engineer, built the first fixedvisual telegraphy system between Lille and Paris.

q The first commercial electrical telegraph was constructed bySir Charles Wheatstone its use began on April 9, 1839.

q The first permanent transatlantic telegraph cable was successfully

completed on 27 July 1866.q Transatlantic telegraph cable was failed and turned into American

civil war

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qIndian Telecom Industry started in 1851 when the first operational landlines were laid by the government near Calcutta (seat of British power)

q In 1881 the Telephone services were introduced in India and telephoneservices were merged with the postal system in 1883

q

In 1923 the Indian Radio Telegraph Company (IRT) was formedq In 1947 after the independence, all the foreign telecommunicationcompanies were nationalized to form the Posts, Telephone and Telegraph(PTT), a monopoly run by the government's Ministry ofCommunications

q Department of Telecommunications (DOT) was established in 1980

q Videsh Sanchar Nigam Limited (VSNL) for internationaltelecommunications and Mahanagar Telephone Nigam Limited(MTNL) for service in metropolitan areas in 1986

Indian Telecom Industry

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q In 1994 the National Telecom Policy (NTP) was formulated

q Telecom Regulatory Authority of India (TRAI) was created in 1997

q Indian Telecom Industry can be divided into two segments: Fixed ServiceProvider (FSPs), and Cellular Services

q Indian Telecom Industry ' services is not only confined to basic telephonebut also extends to internet, broadband (both wireless and fixed), cable TV,SMS, IPTV, soft switches, etc

qThe wireless technologies currently in use in the Indian

Telecom Industry is Global System for MobileCommunications (GSM) and Code Division Multiple Access(CDMA).

qThe gross revenue of the telecom service sector for the year2009-10

was Rs. 1,57,985 crores

Contd

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Growth of Subscriber base (in million) from 2000 to 2010

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Environment in Telecom Sector

WIRELINE (in million)

WIRELESS

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BROADBANDSUBSCRIBERS

INTERNET SUBSCRIBERS

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Market Segment VSAT

q At present, there are eight VSATservice providers in India, includingBSNL, Bharti Airtel, HughesCommunications India Ltd and HCL

Comnet Ltd.

q The number of VSAT subscriberservices grew by 4,311 to 128,406 forthe quarter ending June 2010. The

market for VSAT services registered3.5 per cent growth in the quarterending June 2010.

q Bharti Airtel is the current marketleader, with a market share of 30.9 per1212


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The subscriber base of individual wireless service providers (both GSM andCDMA)

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Basic Services Operators

BSNL

MTNL

Major Players in different segments ofIndian telecom industry

Reliance

TTSL

GSM Services

OperatorsAirtel

Vodafone

Idea

Reliance

TTSL

BSNL

CDMA ServicesOperators

Reliance

Internet ServicesOperators

BSNL

MTNL

Reliance

TTSL

BSNL

Airtel

TTSL Tata Teleservices Ltd.

MOBILE SERVICES

BSNL Bharat Sanchar NigamLtd.

MTNL Mahanagar Telecom NigamLtd.


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Market share of Wireless Service Providers (as on 31stMarch 2010)

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q Despite the global economic slowdown in 200809, the telecom sector isone of the highest FDI-attracting sectors in India. At present, 74 to100 percent FDI is permitted for various telecom services.

q

The telecom sector is among the leading sectors attracting FDI, accountingfor 8 per cent of the cumulative FDI equity inflow from April 2000 toSeptember 2010, which is valued at US$ 9,988 million.

q The telecom market is witnessing significant M&A activity. This trend hashelped companies expand their presence in the Indian telecom market to offer

better services to customers.

Investments

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Opportunities

qAmong the Biggest Telecom markets in the world

qRural Market

qEmergence of BWA Technologies

qInternet Services

qGrowth and Telecom Infrastructure

qGrowth in VAS

qTelecom Equipment Market

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Advantage India

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q

Telekom Malaysia TM, is the largest integrated solutions providerin Malaysia

q Asia's leading communications companies, with a marketcapitalization of 13.9 billion and a workforce of 26,629 employees.

q Established as the Telecommunications Department of Malaya in1946, it was privatized in 1987, and listed on Bursa Malaysia in 1990.

q Subsequent growth led to a demerger in 2008 of TM's mobile andfixed services, allowing the company to focus more intently on its corebusinesses of Internet and multimedia, data and fixed-line services.

Malaysia Telecom Industry

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GDP sector composition, 2010 (in percentage)

Agriculture 9.1%

Industry 41.6%

Service 49.3%

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Telecom market environment

q Only 3 major Companies Telekom Malaysia , Maxis and Digioffer public telecom services

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Contd..

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Malaysia Mobile Markets

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Mobile Markets

qTotal value of the market in 2007 was estimated atapproximately $3.5billion

qThe sector has been compounded annual subscribers growthrate of 20-30% every year since 1998 and subscriber growth

has predictably began to slow

qVoice Services dominate the market today.

qAnalyst reports found that Malaysia ranked Japan and the

Philippines in terms of high usage and high interest foradvanced mobile services

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Challenges in Indian & Malaysia telecomindustry

q

At the end of August 2011, tele-density was recorded at 59.6 percent with a total telephone subscriber base of 706.4 million.

qBy 2014, the wireless subscriber base is expected to reachapproximately 1 billion to include around 572 million urbansubscribers and 468 million rural subscribers.

qRevenues of the Indian telecom industry are projected to reach US$45 billion by 2012

qIn March 2011, Telekom Malaysia announced its intention to startproviding mobile voice services by the end of 2011. Bloombergreported that Telekom was exploring collaboration with CelcomAxiata Sdn Bhd, including possible mobile virtual networkoperations.

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