Telecom Management

EC482, 8th Sem ECE Management Elective

Topic:

India Telecom Perspectives

9th Feb 2012 class

Prof. Satish Manocha, ASE, Bengaluru
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India Telecom Perspectives

Framework India Telecom Market Telecom Related Organizations

Telecom regulations
National Broadband Plan What Needs to be Done

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Framework
India A Country of Immense Potential
Well Trained Population (Selected Segments) Use of Advanced Technologies and Knowledge Base (Selected Segments) Extensive wireless voice urban network Fast Industrial Growth Rate Diversity, Free Thinking* Challenges Infrastructure, Infrastructure, Infrastructure Closing the Urban and Rural Gap Productivity, Communications, Education Application of Global Technology and Processes to Local Environment and Needs Developing a Regulatory / Competitive Balance Timely and Fast Decision Making Affordability Creation and Distribution Telecom / Communications A Key Enabler for Progress *: The Argumentative Indian by Dr. Amartya Sen
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Living in all centuries at the same time

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India Telecom Market - 1

Higher subscriber volumes, lower tariffs and falling handset
prices

Mobile penetration of around 65% in early 2011

750 million mobile subscribers (including both GSM and CDMA services) coming into 2011 GSM technology continued to dominate the mobile market in India; while CDMA still clings to a market share of around 15%

ARPU has been steadily declining as competing operators

offer cheaper tariffs the usage levels have remained reasonably high thus slowing the decline in revenues.

Major push in recent years to take mobile services into the

poorer and rural areas of the country

2010 the long-awaited 3G auctions finally took place. 2011 the 3G networks were rolled out and services delivered
to customers.
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India Telecom Market - 2

Rationalizing the number of operators By early 2011 there were just over 13 million broadband

subscribers a lowly penetration (by population) of slightly more than 1%. Wireless broadband technologies

Attempts to free up blocks held by other ministries 160 operational Internet ServiceProviders(ISP) in the country
10% of the ISPs have 90% of the subscribers. state-owned BSNL and MTNL with Tatas continue to dominate the market, holding first and second place in terms of Internet subscribers and a massive 70% of the total subscriber base

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India Market share

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GSM Operators

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CDMA Operators

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Wireline Market Share

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India Broadband Market Share

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ISP Market Share

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India Broadband Connections

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Internet Usage Purpose

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India National Broadband Plan

Nation-wide Broadband network to Reach Education,
Healthcare, Banking and Other Services to all the Villages

Telemedicine, e-commerce, e-banking and e-Government

available through a high-speed Internet connection

2004 Defined Broadband as 256 Kbps Download

2010 recommendation to increase to 2 Mbps

Broadband 20 million Target connections by the end of year

2010 in India (TRAI 2004). Actual 10 million achieved by 2010.

10 % Point Increase in Broadband Penetration Accelerates

Economic Growth by 2.5 percentage Points

Broadband Connections:
China: 120 M, USA 85 M, India 10 M

3G and Broadband Wireless Access (BWA) Auctioned

0.2 to 0.3 M in Contrast to 18 million mobile Voice Connections per Month
(TRAI Dec 2010)
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India Regulatory Environment

Regulatory Bodies by Govt of India
Telecom Commission Administrative, Financial, Spectrum, Validation

Department of Telecommunications (DOT)

International Forums, Administration of Laws Telecom Regulatory Authority of India (TRAI) Customer Interests, Policy Recommendations

Telecom Dispute Settlement and Appellate Tribunal (TDSAT)

Adjucate on Disputes, Appellate Authority

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Telecom Commission

Administrative and financial powers Policy formulation, Licensing

Wireless spectrum management

Administrative monitoring of public sector units (PSUs) Research and Development Standardization and validation of equipment

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Department of Telecommunications (DOT)

Communications with such as International
Telecommunication Union (ITU),

International Telecommunication Satellite Organization,

International

Mobile Satellite Organization and

Asia Pacific Telecommunity(IPT).

Promotion of standardization, and research and development

in telecommunications

Promotion of private investment in telecommunications Financial assistance for research and study in
telecommunications technology to adequately train manpower

Administration of laws

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Telecom Regulatory Authority of India (TRAI)

Recommendations on various aspects related to the
functioning of telecom service providers

Monitor the quality of services provided by the service

providers & publish

Protect consumers interest Recommend the provision of Universal Service Obligation

(USO) to connect the Unconnected.

Fix tariffs for various telecom services Advise the government on

Need and timing for introduction of new service providers Terms and conditions of the license

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Telecom Dispute Settlement and Appellate Tribunal (TDSAT)

Adjudicate on disputes
Between licensor and licensee Between two or more service providers

Between service provider and group of consumers

Act as the appellate authority in respect of any directions,

decisions or orders of TRAI Any appeal beyond TDSAT is only to the Supreme court

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Telecom in India - Issues

Affordability
Estimate Typically Consumers willingness to pay 2.5% of Disposable Income on Telecom Services

Broadband Continues to Lag Behind

Introduction of Smartphones and Android Based and iPhone Handsets Launch of 3G/ Mobile Broadband services, next 4G

Indigenous Telecom Manufacturing guidelines New Restrictions on Telecom Equipment on non-Indian

Manufacturers Knowhow Transfer Source Code Collateral Adverse Effect on Indian Operators and Telecom Growth in India

International Best Practices?

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India Telecom Trends

Tariff Wars
High value per Rupee

Fast Growth in Mobile Voice Consolidation in the Countrys Crowded Telecom Market Shift of Focus from Urban to Rural
Rural Voice Teledensity:25% Urban teledensity:100%,

Voice to Video and Data Applications Financial Services on Mobiles Mobile Number Portability (MNP)since 2011

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India Technology Focus Areas

Timely Introduction of Broadband Access Very Important for Growth
Business, Education, Entertainment Affordable Cost (Few Hundred Rs/month) Clustered Approach Leveraging Relevant Technologies for Broadband Access Limited DSL for Existing Copper Connections Difficult Coax/Cable Facilities for Residential Applications Difficult Fiber Penetration for Broadband Access For Broadband Mobility, 3G WCDMA/HSPA Key Option WiFi for Selected and Limited Hot Spots WiMAX for Metropolitan Coverage LTE Longer Range Option Fiber and WiMAX for Backhaul Packet Transport Smart User Equipment - Multimedia Capable

Mobile E-Services an Imperative

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DOT
Policy formulation, licensing and coordination of matters related to telegraphs, telephones, wireless, data, facsimile and telematic services and other like forms of communications Granting licenses to operators for providing fixed and Value Added Services (VAS) in various cities in accordance with the policy of government Implementing treaties and agreements with other countries International relations in matters connected with telecommunications, including matters relating to all international bodies dealing with telecom

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India Population Pyramid: Age-wise

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Indias Telecom Growth

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India Internet Usage

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India Services Expenditure

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India Telecom Trends - 1

Tariff Wars High value per Indian Rupee Fast Growth in Mobile Voice Broadband Continues to Lag Behind

Rural Penetration Still a Challenge

Introduction of Smartphones and Android Based and i-Phone handsets launch of services.

Auction and allocation of 3G and Broadband spectrum and Consolidation in the countrys crowded telecoms market Shift of Focus from Urban to Rural: With rural teledensity at
about 25% as compared to urban teledensity of 100%,

Broadband will get a boost with the launch of the National

Broadband Plan

Indigenous Telecom Manufacturing

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India Telecom Trends - 2

Voice to Video and Data Applications Financial Services on Mobiles launch of 3G/ Mobile Broadband services
Web browsing is expected to be the most used service among mobile broadband users in India.
Music and video related services are likely to be next most popular services. Data will be segmented and the plans will be tailor-made for different segments of the population. Price will be the most important determinant of take up of 3G services, followed by content. The tariff plans are expected to be competitive and innovative. Initially, take up of 3G services will be concentrated more among urban subscribers.
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India Telecom Trends - 3

Mobile Number Portability (MNP)
greater focus on quality and service to retain subscribers

Mobile Banking: Shift Towards smart handsets:

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Telecom in India - Issues

New restrictions on telecom equipment that is manufactured
and sold by non-Indian manufacturers to telecom service providers located in India transfer the underlying technology to the Indian purchaser of the telecom equipment within three years Issue of Intellectual Property deposit the source code of telecom-related software in an escrow account that is controlled by the Indian government

Maintenance entirely by Indian Engineers within two years

Adverse on Indian Operators and Telecom Growth in India International Best Practices?

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Telecom in India Whats Needed

Recognition of Telecom as a critical part of National Growth Uniformity and Consistency of Policies New National Telecom Policy 2012

Micro-regulation should give way to a market based approach

Applications for end customer good Banking, Education, health, Government Services

Steady , adequate and predictable availability of spectrum.

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Key Focus Areas

Provision of High Speed Data Access as Compared to
Continued Emphasis on Proliferation of Voice Networks Technology Path Consistent with Availability of Current and Upcoming Technologies Alignment with Global Environment with Local Execution Services and Applications Consistent with Indias Needs Technology and Knowledge Development Open and Distance Education Study roles & functions of ITU, APT, DoT, TRAI, TDSAT, WPC, TEC, TEMA from their websites Roles of COAI, AUSPAI, WiMAX Forum

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Challenges
Closing Urban/Rural Gap
Access (Affordability & Distribution) Focus on Tier2 and Rural Customers Delayed Deployment of Mobile Broadband Department of Telecommunications (DOT) Delay in Spectrum Allocation: FCFS(First Come First Served) or Auction Becoming a Technology Leader Business Model

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