Reliance communications

1. COMPANY INFORMATION Reliance - India's largest business house

Reliance Anil Dhirubhai Ambani Group, an offshoot of the Reliance Group founded by Shri Dhirubhai H Ambani (1932-2002), ranks among Indias top three private sector business houses in terms of net worth. The group has business interests that range from telecommunications (Reliance Communications Limited) to financial services (Reliance Capital Ltd) and the generation and distribution of power (Reliance Energy Ltd). Reliance ADA Groups flagship company, Reliance Communications, is India's largest private sector information and Communications Company, with over 40 million subscribers. It has established a pan-India, high-capacity, integrated (wireless and wire line), convergent (voice, data and video) digital network, to offer services spanning the entire infocomm value chain. Other major group companies Reliance Capital and Reliance Energy are widely acknowledged as the market leaders in their respective areas of operation.

2. BUSINESS DESCRIPTION
RELIANCE COMMUNICATION 2.1 OVERVIEW

A dream come true The Late Dhirubhai Ambani dreamt of a digital India an India where the common man would have access to affordable means of information and communication. Dhirubhai, who single-handedly built Indias largest private sector company virtually from scratch, had stated as early as 1999: Make the tools of information and communication available to people at an affordable cost. They will overcome the handicaps of illiteracy and lack of mobility. It was with this belief in mind that Reliance Communications (formerly Reliance Infocomm) started laying 60,000 route kilometers of a pan-India fibre optic backbone. This backbone was commissioned on 28 December 2002, the auspicious occasion of Dhirubhais 70th birthday, though sadly after his unexpected demise on 6 July 2002. Reliance Communications has a reliable, high-capacity, integrated (both wireless and wire line) and convergent (voice, data and video) digital network. It is capable of delivering a range of services spanning the entire infocomm (information and communication) value chain, including infrastructure and services for enterprises as well as individuals, applications, and consulting. Today, Reliance Communications is revolutionizing the way India communicates and networks, truly bringing about a new way of life. 2.2.1 VISION: We will leverage our strengths to execute complex global-scale projects to facilitate leading-edge information and communication services affordable to all individual consumers and businesses in India. We will offer unparalleled value to create customer delight and enhance business productivity. We will also generate value for our capabilities beyond Indian borders and enable millions of India's knowledge workers to deliver their services globally. 2.2.2 Indias leading integrated telecom company Reliance Communications is the flagship company of the Anil Dhirubhai Ambani Group (ADAG) of companies. Listed on the National Stock Exchange and the Bombay Stock Exchange, it is Indias leading integrated telecommunication company with over 40 million customers. Our business encompasses a complete range of telecom services covering mobile and fixed line telephony. It includes broadband, national and international long distance services and data services along with an exhaustive

range of value-added services and applications. Our constant endeavour is to achieve customer delight by enhancing the productivity of the enterprises and individuals we serve. Reliance Mobile (formerly Reliance India Mobile), launched on 28 December 2002, coinciding with the joyous occasion of the late Dhirubhai Ambanis 70th birthday, was among the initial initiatives of Reliance Communications. It marked the auspicious beginning of Dhirubhais dream of ushering in a digital revolution in India. Today, w e can proudly claim that we were instrumental in harnessing the true power of information and communication, by bestowing it in the hands of the common man at affordable rates.

2.2. PRODUCT LINE

RELIANCE MOBILE

POSTPAID

FEATURES OF POSTPAID

a)1 INDIA- Now call any phone, anywhere in India for just ONE RUPEE per min. b) My Plans- Presenting a range of Postpaid plans designed to fit every lifestyle .So go

ahead get on to Local gossip , chat for hours on STD , get close to your group or jest get lost in new horizon. c) Joy Plans- Reliance Mobile postpaid is a joy to use. Our postpaid plans help you save on costs. Take your pick from a wide choice of plans with economical tariff rates, according to your use and budget. d) On-net Talk time Pack- Get 1,000 minutes of FREE talk time. Thats right. Now, you can

enjoy the first 1,000 minutes of calling to all Reliance mobiles and fixed wireless phones and terminals (FWP/T) in your circle, absolutely free! e) Get Started Kit- Do not be tied down by a particular handset or phone number. Now set yourself free with the new Get started kit from Reliance Mobile. f) Bill Payments- Introducing convenient bill payments. Now pay your bills directly from your credit card or bank account, and save precious time. g) INMARSAT- Save up to 70 per cent on calls to satellite phones. Reliance exclusively offers its subscribers significant savings up to 70 per cent depending on the type of terminal and the location for voice calls made to any Inmarsat number. PREPAID

FEATURES OF PREPAID a) Prepaid Tariffs- Choose the tariff plan that suits you needs. b) E-Recharge- Now you can recharge your prepaid with any amount, from Rs.10 to Rs.10,000. So don't let your budget stop you. Choose a recharge value that suits you and stay mobile. c) 1INDIA- Introducing 1 INDIA recharge options of 1 day, 1 week and 1 month validity. d) Get Started Kit- Gone are the days when you were bound by a particular handset and a certain phone number. You can now set yourself free with the new Get Started Kit from Reliance Mobile. e) Chat & Play - Now you can recharge your prepaid with any amount, from Rs.10 to Rs.10,000. So don't let your budget stop you. Choose a recharge value that suits you and stay mobile.

Reliance HELLO Reliance landline:

FEATURES A complimentary bouquet of features

a) Next-Gen caller ID: Reliance Landline displays the name and/or number of a waiting caller while you are in the middle of a conversation. It allows you the flexibility to choose between two calls or switch from one caller to another. b) Mobile phone features: Now enjoy all the interactive benefits of a mobile phone. Store and recall numbers from the phone book, check the history of missed / dialed / received calls. Whats more, you can also use the history menu to make fresh calls. c) Delayed hotline: You can program your Reliance Landline to automatically call a predefined number by lifting the receiver and holding it for seven seconds. d) Navigation keys: Using the navigation keys on Reliance Landline you can activate phone features like delayed hotline, line locking, etc now you need not remember complicated feature codes and cumbersome procedures. You can also set your preferred ring tone, ringer volume and LCD contrast. e) Remote phone management: You can lock or unlock the STD/ ISD facility or hotline settings on your Reliance Landline, remotely from anywhere, from any tone / DTMF phone. Plus, you get host of other interesting features like speaker phone, 3-way conferencing, quick dialing, and many more. Fixed Wireless Phone

Benefits: a) No wires attached

Get on the wireless connectivity bandwagon. And straight away become

immune

to cuts in the cable, rains etc. Carry the set along with you when you move from one room to another or when you shift your home/office.

b) Wireless Internet (Reliance Net connect) The FWP has an in-built modem for high speed internet connectivity. Surfat speeds up to 115 kbps. Whats more, you do not need a separate ISP connection for operating the set. c) Mobile Phone's Features Enjoy all the features of a mobile phone: SMS, In-built caller line identification, voice mail, 99-number phone book, speaker phone, a choice of many ringtones, etc. d) City Mobility You can use your FWP anywhere within your city and still receive and make calls, at no extra cost.

FIXED WIRELESS TERMINAL(FWT)

Fixed terminal, limitless benefits BENEFIT

e) Great Savings Unbelievably low call rates. Substantial savings on ISD calls.

f)

Zero Effective Rentals

Value of free calls almost equivalent to monthly plan charges. g) Parallel Connection Facility Two voice ports to connect two telephone instruments to be used as parallel connections. h) No Wires Attached Wireless connectivity-immune to cable cuts, rains etc. Carry it along when you shift your home/office. i) Wireless Internet (Reliance Net connect)

In-built modem for high speed Internet connectivity at speeds of upto 115 kbps. No separate ISP connection required. j) State-of-the-art features

Three-way Call Conferencing, Speed Dialing, Hotline, Call Restrict/Call Lock, Call Wait/Call Hold, Call Divert, Alarm and Caller Line Identification enabled.

Reliance broadband.

3 COMPETETORS

2.3.1 BSNL

Fig: 8

The Grand Daddy of all Operators, The State owned B.S.N.L. was the first to launch P.C.O. service across the country under the guidance of Sam Pitroda who revolutionized the telecom industry in India. Besides its nationwide presence, it enjoyed the first mover advantage and had no competition for almost a decade. The advent of private operators made BSNL pull up its socks but still has an edge over others in the market.

2.3.2 TATA INDICOM

Fig: 9 Pay Telephony Business Unit (PTBU) is a strategic business unit of Tata Teleservices Limited and has been the first private and branded player in the payphone industry in the country. It provides its services under the brand name of Tata. Starting with 5 circles in 2000 it has a nationwide presence in 20 circles and over 200 towns across the country today. Tata also uses C.D.M.A. wireless technology as used by Reliance but with a much smaller infrastructure which is concentrated in only a few states like Maharashtra and Andhra Pradesh. 2.3.3 AIRTEL

Fig: 10

Airtel, the Basic phone service of Bharti emerged as the first private competitor in the basic phones market. Though using Landline phones (copper-wire circuitry) the

service turned out to be a welcome break from the inefficient government owned operators.

. STRATEGIC ANALYSIS OF THE COMPANY

3.1. ANSOFFS MATRIX

The Ansoff product-market matrix helps to understand and assess business development strategy. It has two dimensions, products and markets. Four different growth strategies can be formulated and any business can choose which strategy to employ, whether purely or as a mix. The strategies are
Market Penetration Market Development Product Development Diversification

Reliance FWT PCOs can be categorized as product development. Product development involves selling new products in existing markets.

MARKET PENETRATION Penetrating the market for Product A, B, C, D wherever leadership is there. MARKET DEVELOPMENT Introducing the Product B, C, D in newer markets(New territorial region within the country)

PRODUCT DEVELOPMENT Introduction of new facilities, customer friendly service, attractive DIVERSIFICATION instruments etc. The company may try providing consultancy for Telecom infrastructure creation in developing countries in Middle East, South Asian regions. Nepal, Bhutan, Bangladesh

Fixed Wire line Phones

PEST ANALYSIS

POLITICAL
Permission of FDI (100%) New Telecom Policy 1999 Recommendations Of TRAI for growth in WLL phones Policy changes for public-private partnerships Unified Access Licensing Scheme

ECONOMICAL
Indias Per Capita holds higher teledensity potential Increasing demand for telephony strong association between service sector growth and telecom development

SOCIAL
High purchasing power of people. new sources of employment welfare enhancing consequences improved access in the fields of education, healthcare, governance

TECHNOLOGICAL

growth of telecommunications infrastructure shortage of telephone lines and high telephone charges Last Mile Connectivity Technological innovation in the form of CDMA and 3G.

The PEST analysis is a useful tool for understanding market growth or decline, and as such the position, potential and direction for a business. A PEST analysis is a business measurement tool. PEST is an acronym for Political, Economic, Social and Technological factors, which are used to assess the market for a business or organizational unit.

SWOT Analysis

INTERNAL ASSESSMENT OF ORGANISATION

STRENGTHS

WEAKNESS

Highest commission structure (RIL30%, MTNL 15-18%) among national long distance operators. State of art wireless technology. Hassle free installation. No security deposit Brand name Reliance. Sales backed by extensive customer care and after-sales services. Prepaid PCO system, therefore, hassle free billing mechanism

Hesitation among PCO owners in adopting relatively new technology in landline segment. Resentment among business class due to billing problems with RIM. Connectivity problems in some remote, rural areas of Bihar, Uttar Pradesh. Callousness on the part of LBA will effect customer satisfaction

SWOT ANALYSIS

OPPURTUNITY

THREATS

Curre nt te le-density o f Ind ia is only 9.15%. 90.85% o f peop le still depend o n PCO s fo r their co mmunicatio n needs. The co mpo und a nnua l gro wth rate of PCOs is 25 %. Curre ntly there are 16.55 lacs PCOs in Ind ia, wa iting to be churned. Custo mer service standards o f its ma in co mp etitor M TNL / BSN L is not very sa tisfacto ry Prob le ms o f b illing in po st-paid systems

Pitted against well-entrenched player like MTNL / BSNL which control approximately 85% of PCO market in metros, 90% of PCO market in urban, semi-urban areas and nearly 100% in rural areas. Entrance of new players like Bharti and TATA Teleservices Perceived saturation in PCO market. TRAI's impending regulations

EXTERNAL ASSESSMENT OF ORGANISATION

ANALYSIS OF COMPANY STRATEGY 4.1 PORTERSs FIVE FORCE MODEL

SUPPLIER POWER
High Competition Concentration of Suppliers

BARRIERS TO ENTRY
RIVALRY High Initial Costs Government Regulations Specialty Assets Required

THREAT OF

SUBSTITUTES

Moderate High Switching Costsrowth

Low Exit Barriers High Switching Costs Low Concentration Ratio BUYER POWER

High (Price Sensitive Market)

High Switching Costs

High Bargaining Power High Switching Costs

ANALYSIS OF COMPETITIVE POSITION

5.1 BCG MATRIX

BCG matrix is based on the product life cycle theory that is used to explain how different products should be prioritized in a companys portfolio. It has two dimensions: market share and market growth. The two dimensions are used to create a quadrant matrix in which all the products in a companys product portfolio are categorized into the four categories. This analysis helps avoid a strategy mistake made frequently that is of measuring the performance of different products on the basis of a single criteria e.g. generic growth rate. This framework assumes that an increase in relative market share will result in an increase in generation of cash.

5.1.1 STARS

These are high growth products which have a large market share in fast growing industries. In case of reliance Communications its FWT services can be called stars since they have a share of 21% of the market and are growing at the rate of 9%. This service contributes 18% of total revenues and justifiably accounts for a large percentage of total investment. Continuous investments should be undertaken by the company to expand market share of WLL services because this could lead to them becoming cash cows for the company in the future.

5.1.2 CASH COWS These are the products which are leaders in markets which are slow growing but the company has a large share of the market. As a result these products generate large amounts of cash and profits but because of the slow rate of growth of the market investments in these products should be kept low. These products are the foundation for a company and provide the cash required to turn question marks into market leaders. In context of Reliance its cellular services are growing at 4% p.a., are the cash cow which form the foundation of the company.

5.1.3 DOGS

These are the products in which the company has a small share in a slow growing market. As a result their contribution to overall revenues is limited and they can turn into cash traps because of money tied up in a business which has limited potential. Therefore the company should be beware of expensive turnaround plans and should try to divest in these products. In case of reliance its fixed line services can be called the dog for the company.

5.1.4 QUESTION MARKS

These are the products that are growing rapidly and thus consume large amounts of cash, but because they have a low market share they dont generate much cash. But if proactive measures are not undertaken to increase the market share they degenerate into dogs after years of cash consumption. Therefore the company should aim at either investing heavily to increase market share or sell off to generate whatever cash it can. In case of Reliance there are a number of products which can be put into this category for example ISPs and LPCs and WLL PCOs.

A major limitation of this model is that it assumes market growth rate to be the only factor of industry attractiveness and relative market share to be the only indicator of competitive advantage. Therefore it ignores the strategy where a business might u se a dog to gain a competitive advantage in other business units.

STAR

QUESTION MARK

Fixed Wireless phone Fixed Wireless Terminal Phone

PCOs ISP and Broadband Services GSM cellular service.

CASH COWS

DOGS

Cellular Services Reliance India Card Recharge Coupons

Fixed Wire line Phones

. STRATEGIES ADOPTED

6.1 SEGMENTATION

6.1.1 Geographic

Geographic segmentation divides markets into different geographical units. There are four main cellular segments Metro the metropolitan areas of Mumbai, Delhi, Calcutta, and Chennai are under this category of telecommunications circles and continue to lead. Category A circles mostly analogous to the states of India, comprising Andhra Pradesh, Maharashtra, (category a leaders) Gujarat, Karnataka and Tamil Nadu.

Category B circles mostly analogous to the states of India, comprising Uttar Pradesh (east and west), Punjab (category B leaders), Rajasthan, Haryana, Kerala, Madhya, Pradesh, and West Bengal. Category C circles mostly analogous to the states of India, comprising Bihar, Orissa, North-East Assam, Jammu and Kashmir, Himachal Pradesh, Andaman and Nicobar Islands In context of Reliance PCOs, the company is specifically targeting non metros, highways, commercial areas in metros, small townships and low income clusters in urban areas for e.g. urban villages and industrial areas.

6.1.2 Demographic In demographic segmentation, the buyers are divided into different groups on the basis of variables such as their age, family size, family life-cycle, gender, income, occupation, education, religion, race, generation, nationality and social class. Consumer wants, preferences and usage rates are often associated with demographic variables. The relevant categories that can be identified for Reliance PCOs are senior citizens, unemployed youth, small shop owners, kirana stores and existing PCOs owners

6.2 TARGETING

Reliance Communications current targeting approach is a mass-marketing method that tries to address the needs of the entire market and widen its subscriber base. In mass marketing, the seller engages in mass production, mass distribution, and mass promotion of one product to all its buyers. Mass marketing creates the largest potential market, which leads to the lowest costs, which in turn can lead to lower prices and higher margins.

Reliance successfully implemented this strategy and while it did help Reliance in expanding its customer base, its strength and spread remained limited to the Category C regions (See table 2). The apparent popularity of Reliance Communications in this category is due to its positioning in the market as a Common Mans Phone. Dhirubhai Ambani had dreamed of Roti, Kapda, Makaan aur Mobile which clearly reflects the strategy, adopted by Reliance. The low-tariff plans, low fared prepaid and postpaid offers have brought Reliance close to the price conscious people.

They focus on few key aspects while promoting Next Generation technology Widely available (Able to connect 90% of Indias population) Low tariff rates to attract a wide customer base Range of handsets offered with Reliance connections (Black and white handsets, colour handsets with camera, video camera phone, camera watch phone, PDA colour phone) Special offers for making calls to the Gulf, USA and Canada

6.3 POSITIONING

Positioning can be defined as the act of designing the companys offering and image to occupy a distinctive place in the mind of the target market. The positioning of the target has to be such that a majority of the target market segment identifies with it.

7. 4 PS OF MARKETING

7.1 THE FIRST P PRODUCT

The action plan of launching a new product includes a decision on the four Ps of product, place, price, and promotion as well as the three Ps of services namely people, processes and physical evidence. Also it is not a pure product or a pure service that is being marketed. In terms of product Reliance is offering tangible good with

accompanying services, with the handsets being tangible goods and their mainstay being the services. Now we can make this tangible on the basis of place, people, price, and communications material. Historically the thinking was that a good product will sell for itself. However there are no bad products anymore in todays highly competitive markets. Therefore its inevitable now for a company to ignore on the various aspects of a product. We have tried to analyze the product of Reliance Communications i.e. WLL on the basis of following parameters:

Quality

When we talk about the quality of any telecom service we basically focus on following aspects:

Voice qualityThe Voice quality in CDMA based Networks is much superior as compared to GSM Networks. Therefore Reliance WLL has a technological edge over its GSM counterparts.

Data Transfer RateThe Data rates throughput available to a WLL user using a 3G handset, being provided by Reliance is much higher than the data rates provided by the GSM Operators using GPRS, a 2.5 G technology inferior to Reliance 3rd Gen technology. So for a layman, it may mean that watching a Video Clipping or a multimedia application on a CDMA Handset will be much more fun as compared to the present day GPRS Services

Strong Optical BackboneReliance, being an operator with Pan India presence, and possessing a strong optical Backbone spread across the country, is expected to deploy and provide next generation telecom services quicker and cheaper than any other private operator in the country.

APPEARANCE Appearance and design, however, still remains the user's first turn-on trigger. Reliance WLL phone come as a refuge to the market as they are targeting the various segments of the society. The low end model starts for as low as Rs. 2000 and the range goes up to Rs. 30000. The various phone models available are quality phones being manufactured by the top firms like Nokia, Motorola, Samsung and LG etc.

BRAND Reliance Communications is the outcome of the late visionary Dhirubhai Ambani's (1932-2002) dream to herald a digital revolution in India by bringing affordable means of information and communication to the doorsteps of India's vast population. Reliance Communications Ltd., an Anil Dhirubhai Ambani Enterprises group company, is India's largest private information and communications services provider, with a subscriber base of over 11 million. Reliance Communications has established a pan-India, high-capacity, integrated (wireless and wire line),

convergent (voice, data and video) digital network, to offer services spanning the entire Communications value chain.

SERVICE

Reliance Communications network is a pan India, high capacity, integrated (wireless and wire line) and convergent (voice, data and video) digital network, designed to offer services that span the entire Communications value chain - infrastructure, services for enterprises and individuals, applications and consulting. The network is designed to deliver services that will foster a new way of life for a New India.

SUPPORT The major focus for any company in the service sector is how satisfied their customer is with the service being provided by the company. The service doesnt end wi th by selling the phone to the customer but also solving the concern, difficulties, queries and complaints of the customer. Reliance Communications has some innovative features like R-World apart from the usual customer support services being provided by other telecom players. Reliance has a 24 by 7, 365 days a year, customer service in ten regional
languages to ensure consumers have a smooth experience.

7.2 THE SECOND P PRICE

How much are the intended customers willing to pay? Here we decide on a pricing strategy - do not let it just happen! Although competing on price is as old as mankind, the consumer is often still sensitive for price discounts and special offers. Price has also an irrational side: something that is expensive must be good. Permanently competing on price is for many companies not a very sensible approach. Reliance India Mobile has revolutionized the Indian mobile telephony market through unique pricing models. In fact, thanks to Reliances innovative pricing, tariffs in India have fallen across the board by over 70 per cent, making it the world's lowest-cost mobile market today. India was the world's highest cost market in the nineties.

As of now, RIM has concentrated in terms of its pricing in the economy to medium value segment. The products with high and good value have not been very successful. But that was partly because at that time, reliance was more than just a service provider, dealing in handsets and post paid plans and selling customized solution. Now, with a maturing market, as people are moving to upgrades reliance seriously needs to look into the high value segment. By high value we mean high quality and high price segment. A high service in terms of not just the value adding features but also the quality of your basic services. Airtel has projected itself as a service provider with superior network coverage. Reliance has had issues in the past with its billing and also its traffic congestion which has left many customers complaining. And as they look to expand into new segments that are more life style focused and brand conscious, negative word of mouth publicity is the last thing they would want. Side by side, they also need to look for the latest offerings in the market to lure and retain customers. The first movers advantage they had accrued is now eroded as the competitors have come out with similar features and services like internet surfing, cricket scores and multimedia content in both GSM as well as CDMA segments. So reliance needs to heavily invest in developing new and unique differentiating features and products to project itself as the better option to the upwardly mobile youth. Like Airtels Blackberry initiative. Even though Airtel is fighting reliance bitterly in terms of the least priced services to the consumers, having a high end limited sales volume product in its range gives it a superior image because of its aspiration power in the minds of the affluent youth. In terms of the market pricing is concerned, RIM is faced with a unique situation. Although it is aiming for market penetration, the usual low pricing strategy will not be very successful as all the rivals are offering services at a very competitive rate and drastic undercutting will only lead to erosion of profit margins. Also the market is growing rapidly and further lowering of prices will not fuel the growth further.

SCHEMES:

TARIFF PLAN

FW 150

FW 290

FW 02

FW 03 1000 1000 1000

FW 04 1500 1750 1575

FW 600 600 2000 600

RENTAL(RS./MONTH) CLIP CHARGES FREE CALL UNITS FREE TALKTIME(RS/MONTH) RATE PER CALL UNIT RS/CALL UNIT SECURITY FEE

150 50 50 60

290 150 180

500 450 495

1.20

1.20

1.10

1.00

0.90

0.30:TO RELIANCE 1.10:OTHERS

2800

2800 2800 2800 TABLE: 4

2800

2800

Amount of sales (per month): FWP/I Phone

AREA MAYUR VIHAR ADHCHINI GREEN PARK SAKET PREET VIHAR

FWP(SALE IN UNIT) 25 20 30 25 25 TABLE: 5

I FONE(SALE IN UNIT) 20 20 25 25 20

7.3 THE THIRD P PLACE

Available at the right place, at the right time, in the right quantities? Some of the revolutions in business have come about by changing Place. We have focused on different attributes related to reliance place strategy in successfully removing the bottlenecks associated with the timely availability of its products through a nationwide network of Web Worlds.

7.3.1 LOCATIONS

Reliance Web World is a countrywide network of retail outlets offering a host of state-ofthe art communication and information services along with food and beverages in a modern ambience. It probably is also the world's largest network of public access broadband centre. A total of 240 Web Worlds are operational in 111 cities and towns across India. The number of Web Worlds in this network will further increase to cover nearly 700 towns and cities. All Web World outlets have three components: Customer
Convenience Centre, Broadband Centre and Gourmet Caf. 7.3.2 CHANNEL MEMBERSThe following are the desirable features for sales people: Competence First and foremost is the competence of the sales force. Reliance has had billing problems in the past and competent handling of all customer complaints will be of utmost importance. Courtesy RIM has exclusive retail outlets, which can be monitored, but newer expansion plans will mean selling through other retailers for prepaid cards. Credibility This is a major issue as the previous policies were not very transparent and this has generated a negative perception for Reliance. Responsibility Problems of area distribution between different franchises

Communication

Continuous communication is needed for promoting newer policies and promotion schemes. Higher flexibility given to franchisees in offering customized plans.

7.3.3 DISTRIBUTION CHANNEL

Reliances FWT PCOs are distributed through a network local business associates (LBA). Every district is divided into a number of zones each of which is headed by a zone PCOs lead. In every zone there is a point of sales, the LBA who acts as the interface between the company and the local PCOs operator. The LBA gets in contact with existing and potential PCO owners and after they decide to take a PCO

connection from Reliance, he helps to arrange for the entire package which consists of the phone instrument, FWT, billing machine, telephone booth and patch panel antenna.

7.3.5 MARKET COVERAGE

Reliance is the second largest player in FWT market which is growing at fast rate of 5.5%. The Lead player in the market is Tata Teleservices. But Reliance has shown major improvement in the market coverage and has grown its share from 34.15% in April05 to 37.12% in Oct.05.

7.4 THE FOURTH P PROMOTION

(How) are the chosen target groups informed or educated about the organization and its products? This includes all the weapons in the marketing armory - advertising, selling,

sales promotions, Public Relations, etc. While the other three P's have lost much of there meaning in today's markets, Promotion has become the most important P to focus on. Since its a highly competitive sector therefore Reliance had to work really hard on its promotional schemes in order to grab the market share. But the most important tool that Reliance should really be considering is the sales promotion as a strategy to reach out to a mass audience and grab attention. And also to arouse the interest of the target segment in the product this strategy will be very useful. Just like what Nokia did sometime back for the N-gage and what the two wheeler companies have been successfully doing for a long time, RIM should come up with road shows as soon as they come out with their newer models to generate curiosity in the minds of the people. Online games as suggested should be an important feature of the mobiles and online one to one competitions can be organized for promotional schemes. This is nothing new for Reliance Communications as they had done this for the promotion of their Web world broadband services also. Partnering with KBC like game shows will also be a big draw as Airtel have successfully demonstrated. Another charm for the youth is the concerts, technology fares etc and organizing these as well as partnering as sponsors with such events in colleges and expos can also are used to draw attention.
Recommendations

Reliance has for long been perceived as the common mans phone. It needs to come out of the mid-segment trap by catering to the high end subscribers who bring in larger arpu

It is highly important to retain customers as sooner or later the market will saturate and the low call tariffs will prompt subscribers to switch operators

 With uniform number across operators being a possibility in the near future, existing subscribers will be inclined to move to an operator offering better service, it is highly recommended that Reliance pulls up its socks and improves its service quality which is lacking in certain areas like network coverage and billing

Reliance has the most extensive private network in the country and needs to consolidate its position by improving its standards and living up to its famous brand name