Telecom Industry

Connecting the World

N Arjun
Telecom in the real sense means transfer of information
between two distant points in space

Telecom is a huge and varied bastion of technologies,

companies, services and
politics that is truly global in nature
Introduction

 Telecom stands as one of the most essential elements of the

business world in terms of “Connecting the World”

 Volatile Sector
 Regulatory discord
 Cut-throat competition
 Emergence of Technologies

 Emergence of broadband & wireless technologies pose threat to

carriers relying on aging infrastructure

 To survive, telecom carriers need to consider various options

 Consolidation,
 Convergence,
 Costly Technological upgrades
Global Growth Patterns

 Emerging Markets
 Driving Volume Growth
 Low Tariffs (ARPUs)

 Developed Markets
 Low Subscriber Base
 Technological Advancements

Indian Telecom depends on the global telecom industry for technology

platforms & network management
While
Indian market size attracts telecom giants
Indian Telecom - Scenario

 India – Fastest growing market in World – 190 mn subscribers

 4th largest mobile market growing at 6 mn Sub/month
 4th largest internet market, 3rd largest by 2007
 Voice Revenue dropping;
 PCOs - 4.5 mn @ CQGR of 7.22%
 Paying highest taxes and regulatory charges; Variable License fee

OPPORTUNITIES
 Data revenues – 8.5% of service revenue against world avg of 16.5%
 Content Services – Music/Video etc
 Applications – m Commerce/PVR Ticketing
 Tele-density – From 2% in 2000 to 15.44% in 2006
 TEMA target of $100 bn for equipments in next 3 yrs
 IT & ITES Industry – $35 bn with CAGR of 35%
Indian Telecom – Global Reach
Players Countries Services Subscribers Partners
Bharti
Emtel of Mauritius, (Since
34000 (March
Seychelles Fixed, FWP, cellular 1998) private investors
 Telecom Seychelles 2006)
and the Gov of Seychelles

Jersey Telenet State of Jersey 2G and 3G, ILD Services from

Oct 2006
MTNL
CDMA-based WLL 45,032 (March TCIL VSNL, and NVPL
United Telecom Nepal
services 2006) Wholly
(Since 2002)

MTML (Since 2005) Mauritius CDMA-based WLL services 20000 (March owned subsidiary
2006)
Reliance
ILD services to India,
Australia, Canada,
US, UK and
France, Germany, 500,000 + -
Canada
IndiaCall services Malaysia, NZ, Singapore,
(Since 2005) and UK

VSNL (acquired South Africa Transnet/ Transtel,

license in 2005) Fixed (Services to Eskom, Nexus, Two,
commence in Aug-Sep CommuniTel
2006)

Source: Voice & Data

 Indian Telecom - Global Connectivity

Submarine Cable System Landing

at Chennai, Mumbai, Cochin & Tuticorin

Mumbai Cochin Chennai Tuticorin Year

FLAG 1997
SMW3 1998
SMW2 1994
SMW4 2005 SM
i2i 2004 W
4 Mumbai
TIIC 2005
FLA
SAFE 2002 G
Bharat Lanka 2006
3
W
SM

i2i
Chennai TIC
SM
W SMW
3 4
SAFE Cochin
Tuticorin
Bharat Lanka
 International Bandwidth Growth - India

400
348
350

300
IP Bandwidth
250
205 IPLC
Gbps

200
Managed Data
150
118 Service

Total
100
61
50 33

0
2005-06 2006-07 2007-08 2008-09 2009-10
Source : Telegeography
Year
Conversion: 1 Gbps ~ 6.4 STM1
 Global Trends – Connecting World
Convergence & Mobility

Public
 Mobile Devices with Safety  Mobile Police &
voice, data & video Fire personnel
 Mobile Wireless devices
Broadband  Interoperable
 Fibre to Home Communications Communications

Computers
& IT

 Entertainment  Laptops & Handheld

becomes Digital PCs
 Mobile Personal Consumer  Entertainment major
Digital Devices Electronics PC driver
prevail  IP to & in the Home
 VoIP handsets
Connecting India to the World

ENABLERS

 Unified Licensing
 Telecom Technologies - Internet/Wimax/VOIP
 Reduced License Fees in Long Distance Sector
 Outsourcing Network Management to Global Manufacturers
 India - Telecom Equipment Manufacturing Base
 Convergence - ICT
 FDI Relaxation in Telecom (26% to &74%) - $2.67 bn Aug,06
 Emergence of IT & ITES Sector
 Consolidation & Partnerships between Indian & Foreign Players viz.
BT, AT&T , Aircel & Maxis

Telecom has attracted significant FDI and technology which has resulted in huge
benefits to the Indian Telecom Growth
Connecting India to the World

CHALLENGES

 Regulatory Policies
 Lack of level playing field
 Penetration Level
 Across the world and within India
 Seamless Roaming
 Infrastructure Program
 Manufacture telecom equipment in India
 Passive Infrastructure Sharing
 VoIP
 Value Added Services
 Unutilized software capability
 Digital Divide
 Non Availability of technology, equipment, network access for
millions of poor
 Indian Telecom – Way Forward to being Global
 Transparent and truly technology-neutral Government policies
 Allow full range of private & Public Sector telco's to compete fairly and fully

 Adequate spectrum in useable frequency bands advocated by the ITU to

wireless service providers

 Low regulatory restrictions over new services such as Push-to-talk, IP-

enabled services, particularly Voice-Over IP (VoIP)
 Ensure level playing field and “No” worse-off position for existing license holders

 Duties on imported telecommunications and related equipment must be

reduced to zero
 To promote competition in IPLC

 “Put in Right Policies” for technology multinationals to build business in

consumer end user device segments like mobile, handset, PC’s and
networking product manufacturing

 Acquisitions with “Strategic” intent

Thank You