Telecom

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Table of Contents
India’s Telecommunications framework...............................................................................3
Government Agencies.........................................................................................................4
Industry associations............................................................................................................5
Industry associations
 India’s Telecommunications framework

• Indian telecom framework helps in regulating the level playing field for all
the operators. The department of telecommunication ( GOI) is the
governing body in 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.

• There are two governing bodies

• Indian Govt body – The body formulates various policies and pass laws,
thus regulating the telecom industry in India.

– a. Wireless planning and coordination ( WPC ) – The body handles

spectrum allocation and management

– b. DoT – It regulates the licenses and frequency management for

telecom

– c. Telecom commission – It makes exclusive policy making body of

DoT.

– d. Group on Telecom and IT ( GoT-IT) – It handles the ad hoc issues

of the telecom industry.

– Independent bodies -- 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.

– a. Telecom Regulatory Authority of India (TRAI) – Independent

body

– b. Telecom Disputes Settlement and Appellate Tribunal (TDSAT) --

Telecom disputes settlement body
 Government Agencies

Government Agencies (TRAI / DOT etc)

• Telecom Regulatory Authority of India (TRAI) – Independent regulatory

body to regulate the telecommunication business set up by Govt in 1997.
It formulates the terms and conditions for licensce for the service
provider. Its role is to maintain the competition among the service
providers by formulating rules and regulating liceneses. Ref:
http://en.wikipedia.org/wiki/TRAI

• DoT – It regulates the licenses and frequency management for telecom. It

is the executive branch of Ministry of communication and Information
Technology. The Department of Telecom has been formulating
developmental policies for the accelerated growth of the
telecommunication services. The Department is also responsible for grant
of licenses for various telecom services like Unified Access Service
Internet and VSAT service. The Department is also responsible for
frequency management in the field of radio communication in close
coordination with the international bodies. It also enforces wireless
regulatory measures by monitoring wireless transmission of all users in
the country.

• Telecom Disputes Settlement and Appellate Tribunal. --

 Industry associations

• Cellular Operators Association (“COAI”) – The objective of the association

is to improve the standards and quality of service wrt to GSM

• Association of Unified Telecom Service Providers of India ( “AUSPI”) – The

association represents industry body of Unified Access Service (“UAS”)
licensing providing the telecom services based on CDMA technology.
 The Indian Wireless Industry

• The wireless subscriber base was 391.76 million subscribers at the end of the
financial year in comparison to the subscriber base of 261.07 million at the end of
March, 2008. It added 130.69 million subscribers in the financial year 2008-09
registering an annual growth rate of about 50.06 %.

• The total subscriber base of wireless services has grown from 33.69 million in
March, 04 to 391.76 million in March, 09

• The Indian Wireless Industry is divided in to 23 circles

• The circles have been categorized as Metros, ‘A’ circle, ‘B’ circle & ‘C’ circle

• The circled are categorized by degree of affluence, infrastructure development and

revenue potential areas.

• There are four metro cirlces

-Chennai

-Mumbai

-Delhi

-Kolkatta

These circles accounts for 15.3% of Wireless subscribers and have highest ARPU
compared to other circles

• There are five category A circles covering the state of Andhra Pradesh, Gujarat,
Karnataka, Maharashtra and Tamil Nadu

• These circles form a major portion of total subscriber base of 137.18 million
subscribers
• There are eight category B circles covering the state of Haryana, Kerela, Madhya
Pradesh, Punjab, Rajasthan, Uttar Pradesh(East & West) and West Bengal(including
Andoman & Nicobar Islands)

• These circles form a major portion of total subscriber base of 146.84 million
subscribers and recorded a increase in growth

• There are six category C circles covering the state of Assam, Bihar, Himachal
Pradesh, North East, Orissa, and Jammu & Kashmir.

• These circles form a minor portion of total subscriber base of 45.65 million
subscribers and have lowest tele-density and ARPU levels

Circles distribution
Evolution of Cellular Networks
 GSM

 Global system for mobile communication

 Goal: Digital voice service with improved quality and also provide better data
services

 Time Frame: 1990- 2000

 Technology: TDMA/TDD

 Enhanced for data services

 General Packet Radio Service (GPRS)

 Enhanced Data rates for GSM Evolution (EDGE)

 CDMA

 Code division multiple access.

 used in several wireless broadcast channels (cellular, satellite, etc) standards

 unique “code” assigned to each user; i.e., code set partitioning all users share same
frequency, but each user has own “chipping” sequence (i.e., code) to encode data

 data rates up to 144K

 VAS

 Not a form of basic service but rather adds value total service offering

 Stands alone in terms of profitability and/or stimulates incremental demand for core
service(s)

 add-on to basic service

 e.g SMS, GPRS, mobile stores (R-world, airtel world ...)

 Wimax

 Worldwide Interoperability for Microwave Access

 Brand licensed by the WiMax Forum.

 “a standards-based technology enabling the delivery of last mile wireless

broadband access as an alternative to cable and DSL”

 WiMAX was seen as more of a Metropolitan Area Network (MAN) technology

providing a much larger coverage.
 3G

 Goal: High speed wireless data access and unified universal standard

 Time frame: 2002-

 Two competing standards

 One based on GSM, IS-136 and PDC known as 3GPP

 Other based on IS-95 named 3GPP2

 Completely move from circuit switching to packet switching

• Enhanced data rates of 2-20Mbps

3G, BWA and MNP status

 3G auctions started on April 7 2010.

 BWA (wimax) auction to done after 3G.

 3 licences in each circle to be given.

 All major companies bidding.

 Mobile number portability – TRAI issued notification in June 2009

 Not yet implemented (deadline of 31 march 2010 extended).

4G (LTE)
 Supports even higher data rates than 3G

 50 Mbps upload and 100 Mbps download.

 Commercial installation started in different parts of world

 The sale process for 4G will begin as soon as operators roll out their 3G networks
this year
 Challenges

 No. of operators are increasing per circle: hence more competition

 ARPUs are going down

 Cost/ Customer is very high in rural areas

 Spectrum – a scare commodity

 Infrastructure readiness in rural

 PC prices are very high

 Availability of Contents in local language

 Availability of Contents for Rural Population

 International Bandwidth is costly

 Telecom Manufacturing in India.

 Opportunities

 IPTV

 VoD (Video on Demand)

 Gaming

 Video calls

 Convergence (e.g. access internet from TV)

 Peer to peer sharing

Wireline vs mobile data access
 Role in development

 Connect rural India to urban India and the world

 Connect even remote areas to the information highway (internet)

 Growth in telecom directly related to globalization.

Direct and indirect employment

Rural/Urban distribution of total telecom subscribers

Trends in subscription (Voice Communication):

Trends in subscription (Data Communication):
Trends in teledensity (Rural/Urban and Wireless/Wireless):

Trends in usage (GSM/CDMA):

Market Share (Wireless/Wireline)
Bharti Airtel
SUNIL BHARTI MITTAL

Chairman and Managing Director of Bharti Group, India's largest GSM-based mobile phone
service provider. Sunil Mittal can be called as originator of cellular phone revolution in
India. Sunil B.Mittal company runs India's largest GSM-based mobile phone service. Son of
a politician, he built his Bharti group, along with two siblings, into India's largest mobile
phone operator in just ten years. Sunil has always been a pioneer.

In his personal capacity, Sunil has received several awards such as:

• Telecom Person of the Year, Voice & Data, 2006

• Best Asian Telecom CEO”, Telecom Asia Awards 2005

• Best CEO, India”, Institutional Investor, 2005

• Business Leader Of The Year”, Economic Times, 2005

 • Ernst & Young Entrepreneur Of The Year 2004”, Ernst & Young

• 1976

• Mittal started his first business at the age of 18, with a capital investment of
Rs 20,000 (U$500) borrowed from his father. His first business was to make
crankshafts for local bicycle manufacturers .

• 1982

• started a full-fledged business selling portable generators imported from

Japan.

• 1986

• Incorporated Bharti Telecom Limited (BTL) and entered into a technical

tie up with Siemens AG of Germany for manufacture of electronic push button
phones.

• 1990

• Mittal was making fax machines, cordless phones and other telecom gear.
started marketing telephones, answering/fax machines under the brand
name Beetel and the company picked up really fast

• 1992

• Successfully bid for one of the four mobile phone network licences auctioned
in India, in collaboration with French telecom group Vivendi.

• 1995

• Launched services in Delhi, when Bharti Cellular Limited (BCL) was

formed to offer cellular services under the brand name AirTel.
 Bharti – Airtel Snaphot

• 3rd Largest wireless operator in the world.

• 6th Largest Integrated telecom operator in the world.

• Largest wireless operator in India.

• Largest operator in NLD, ILD and VSAT business.

• Largest TELECOM company listed on Indian Stock Exchange.

 Bharti Group Important Event Snapshot

• 1995

– Launched cellular services 'AirTel‘ in Delhi.

• 1996

– launched cellular services in Himachal Pradesh

• 1998

– First Indian private fixed-line service, ending fixed-line services monopoly of

DoT (now BSNL)

• 2001

– Bharti Cellular entered into license agreements to provide cellular services in

eight new circles.

– Bharti Telenet entered into license agreements to provide fixed-line services

in the Haryana, Delhi, Tamil Nadu and Karnataka circles

– Bharti Telesonic launched national long distance services under the brand
name of IndiaOne
 – Bharti Telenet launched fixed line services in Haryana under the brand name
of TouchTel.

• 2002

– Comes out with issue of 18.53 crore equity shares through book building
route with a floor price of Rs 45 per share

– Shares listed on BSE, NSE and DSE, opens at 11% premium to its issue price
of Rs 45

• 2003

– Company accorded its approval for amalgamation of its subsidiary companies

viz: Bharti Telenet Ltd, Bharti Telesonic Ltd, Bharti Broadband Networks Ltd
and Bharti Comtel Ltd through scheme of Amalgamation. The merged entity
would be renamed as Bharti Infotel Ltd

• 2004

– Bharti Tele-Ventures enters into a three year service agreement with Ericsson

– Bharti Tele-Ventures (BTVL) has signed and received unified access service
licence to provide GSM services in five circles

– Bharti Tele-Ventures Ltd signed an information technology outsourcing deal

with infotech major IBM, estimated to be in the range of 0-750 million for a
ten-year period.

• 2008

– Nokia Siemens Networks on Jan 3 declared that it has been awarded a multi
million euro contract from Bharti Airtel Ltd for deployment of a single
interactive voice response (IVR) platform across 23 circles.

• 2010

– acquire Zain Africa BV based on an enterprise valuation of USD 10.7 billion.

 Latest Results – Q3 FY09/10

Q3 FY 2010 Y-on-Y

Customers 121.85 mn 38.0%

Revenue $2,093mn 1.4%

EBITDA $838 mn -0.9%

Cash Profit $876 mn 8.9%

Net Income $473 mn 2.3%

Bharti Marketing Strategy

• 2002

• Ties up with SSC (Secondary School Certification) Board, Hyderabad, where

Bharti will announce SSC results to its customers on their mobile phones

• ICICI Bank ties up with Bharti for pre-paid mobile cards via ATMs
 • Bharti Group's cellular brand Airtel has unveiled free multimedia messaging
services (MMS) for its customers. The company has also rolled out pan-India
GPRS (General Packet Radio Services) for its corporate subscribers

• Launches its `IndiaOne MeetXpress' audio-conferencing service

• Airtel provides SMS cricket updates

• AirTel, Touchtel jointly offer freeTouchtel land line for post-paid Airtel
connection

• AirTel rolls out voice mail service for pre-paid customers

• Offers 0-1-2, a new cellular package for the customers, which means zero
charges on incoming calls, Re 1 on mobile-to-mobile outgoing calls, Rs 2 on
mobile-to-mobile STD calls Iinks distribution pact with Hathway Cable. With
this alliance, Bharti is said to be the first telecom firm to step into television
distribution services

• 2004

• Samsung India Electronics Limited has tied up with cellular operator Bharti for
bundling its mobile handsets with a connection.

• Bharti Tele-Venture on July 19 launched ring back tone service which is a

personalized mobile music service where the caller hears songs and other
sound clips instead of the traditional switchboard ring-ring tone

•
 Bharti Product Innovations

Bharti Strategic Business Units

 Performance

• Wireless Customer market share leadership at 22.7%.

• Total minutes on network carried in Q3 –175 billion

• Total employee strength –18,201

• Balance sheet strength:

• Assets -$ 14 billion

• Net debt -nil * ($414 million inclCCD)

• Net debt to EBITDA –nil * (0.12 inclCCD)

• Continues to be FCF positive on a standalone basis

• Note: * Net Debt is excluding fully and compulsory convertible,non-cumulative,

unsecured and interest free Debentures of US$ 661.
Segment contribution…Revenue , EBITDA and Investment
 Bibliography
http://wikipedia.org/

www.trai.gov.in

www.coai.com

www.airtel.in