PROBLEM AREAS:SIM BUSINESS

Revenues from voice minutes has been witnessing sharp decline .

Telco's will lose $386 Billion between 2012 and 2018 due to users switching to skype and
Declining whatsapp when travelling overseas
voice Minutes

Indian Telco's have launched world SIMs & discounted roaming packages for international
travelers
Increased World SIM service costs a fraction of international roaming and customers can save upto 85%
competition on international calls

International Roaming tariffs being slashed by Telco's globally

Operators are offering innovative global tariffs ,which permit users to roam on their standard
Price War domestic rates plus a connection fee
 PROBLEMS CONTD..

Survey Results: Survey Results:

Change in Data Roaming traffic over the next 3 years Global Mobile Revenue;voice and data market share
 DIVERSIFICATION STRATEGY:

Mobile device rental

Untapped
Unique Selling market
Proposition: segment of 9 Market size to Huge Revenue
Mobile device million foreign double by potential
with voice and tourists year 2025
data service arriving in
India
DEVICE RENTAL MARKET SIZE ESTIMATION

Good travel and tourism policies

have increased Foreign Tourist
Arrivals (FTA) significantly for the
past five years

Year 2016, India witnessed 8.8

million Foreign tourist arrivals

By 2025, FTA in India is expected

to reach 15.3 million, according
to the World Tourism
Organization.
**Source: Ministry of Tourism, Govt. of India
 MARKET SIZE ESTIMATION CONTD..

The Market Size for The market size will

We have assumed 1 be ~3 Million by the
Mobile Device for Device Rental business
in the year 2016 was year 2025(Source:
every 2 FTAs vising ~1.5 Million Bureau of
India Immigration, Govt. of
customers
India)

Top 5 Source Countries for FTAs in India in 2016

S.NO Source Country FTAs(# count) Percentage(%) Share

1 United States 1296939 14.73
2 United Kingdom 941883 10.7
3 Canada 317239 3.6
4 Australia 293625 3.33
5 Germany 265928 3.02
Total FTAs 3 Million g

**Source: Bureau of Immigration, Govt. of India

***Bangladesh has been excluded from the list due to low purchasing power of its population
 REVENUE STREAM

Matrix can charge a nominal fee as a deposit which will be

refunded back to the customers once they return the mobile device

The users will be charged on a Pay-Per-Day basis, and the

amount would be collected from the customers upfront

Matrix will also have the option to display sponsored content on the
mobile device and earn advertisement revenues
 DEVICE RENTAL BUSINESS 7 YEAR PROJECTIONS OF FINANCIAL
INVESTMENT AND RETURNS
Operating Profits
Assumptions:
No of FTAs/year (Source Ministry of Tourism Govt. of India) 3115614 Yr-0 Yr-1 Yr-2 Yr-3 Yr-4 Yr-5 Yr-6 Yr-7
No of Devices(Assumption 1 Device/2 FTAs) 1557807
Matrix will capture 10% of this market in the 1st year and would
increase its market share @ 5% Y-OY Revenue(INR Lakh) 117 123 129 135 142 149 157
Cost/mobile device(Average price Indian manufactured 4G device) Rs 5000
On analyzing the FTA arrival pattern we notice that maximum number
of tourists arrive in December(Approx. 1 million)
COGS(INR LAKH) -61 -3 -3 -3 -64 -4 -4 -4
Average stay of tourists 15 days
For the initial traffic of FTAs max device needed (based on the Peak
traffic in December and Govt. of India data that shows Average number SG&A(INR LAKH) -5 -12 -12 -13 -14 -14 -15 -16
of days spent by an FTA is 15 days) 12510
Revenue calculation in based on the market share of Matrix( In year one ,Matrix is assumed to have
captured 10% volume of the incoming FTA traffic)
Market share is expected to grow at 5% y-o-y Operating Profit(INR LAKH) -66 102 107 112 58 124 130 137
The shelf life of the mobile device is assumed as 3 years and 5% new devices will be added y-o-y given the
increase in market share
SG&A is assumed at 10% of the revenues

Assumption Yr-1 Yr-2 Yr-3 Yr-4 Yr-5 Yr-6 Yr-7

Number of FTAs renting device from
Matrix(10% of the total Arrivals+1
device/2FTA) 155781 163570 171748 180336 189352 198820 208761
# of new Devices(In yr-1 12510 new
devices would be needed and the
same device would be rented for the
net 3 years.In year 4 Matrix would
need to purchase the devices again
as the shelf-life is assumed to be 3
years) 12510 626 657 13200 724 760 798
 6 MONTH PLAN: DEVICE RENTAL BUSINESS

5
4 Based on the
feedback of users,
either freeze the
3 Test marketing: gather mobile
feedback on mobile manufactures/network
2 device/network/OS provider and OS else
Selection of software user experience repeat relevant steps
1 firm to design custom
Operating system
Selection of telecom
provider

Selection of mobile
device manufacturer