indian wireless communication: paradigm, opportunities and ... · indian wireless communication:...
TRANSCRIPT
Indian Wireless Communication:
Paradigm, Opportunities and
Challengeby
Prof. Dr. M. S. Sutaone-
Dean-Alumni and International Affairs,
E and TC deptt., COEP-5
E-mail: [email protected]
. AGENDA
� Today’s Telecom Environment
� Small/Medium Business Telecommunications Trends
� What’s Possible in the Next Decade ?
� Technology Challenges
� Indian Scenario: Paradigm and Opportunities
What Do We See Today ?
� Two very clear growth factors
BROADBAND73M US Homes
65% Penetration
MOBILITY280M US Mobile Phones
90% Penetration
Consumer Trends – New Generation, New Usages . . . Driving Data
Usage
� “Connected” generation born with Internet and mobile� A global communication experience: instant information access,
multimedia content creation and sharing
� A continuum of service usage: SMS, Instant Messaging, Email, Online Gaming, Blogs, File Sharing
� Key for the individual social identity: personal blogs, video, picture and music file sharing
� Fast evolving preferences following fashion trends
� New network applications changing everyone’s life� Blogs: 70M in 2005 – 120M in 2007
� Social Networking: Facebook 26M – 90% growth in 2007
� Banking Transactions: negligible in 2006 – 8M in 2008
� Telecom part of “green” & “socially responsible” culture
What Are We Doing on the Internet ?
�76% of P2Ptraffic is video Non-P2P (client-
server) applications
� MySpace
� YouTube
� iTunes
� Napster
� Gaming
How Much Data Is There ?
consumes more bandwidth today than the entire Internet did in 2000
It took 200 years to fill the Library of Congress
� 57 million documents, 29 million books, 12 million photos
� Worldwide, an equal amount of digital info is generated
almost 100 times per day
* University of California at Berkeley study** IDC – The Diverse and Exploding Digital Universe
One Exabyte = 1 quintillion bytes = 1,152,921,504,606,846,976 bytes (or 1B GB)
� 12 Exabytes = Sum of all human produced information (audio, video, text/books) through
1999 (of which 1.5 exabytes was created in 1999 alone) *
� Worldwide Information Tracker - http://www.emc.com/leadership/digital-universe/expanding-digital-universe.htm
shows 431 Exabytes created and replicated worldwide since 1/1/2008 (to 12/1/08 10pm) **
� That’s 1.2 Exabytes a day !!
How Fast Are Data Speeds Growing Across Fixed and Mobile Networks ?
� Wireline Access Technologies� Speeds: +50% per year
� Faster connections: more consumption
� Broadband/home: +20% over the last few years and will be boosted by HD video
10 Kbps
100 Kbps
1 Mbps
10 Mbps
100 Mbps
1000 Mbps
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
CDMA
GPRSUMTS
Today
Mobile Broadband
CDMA 2000
1xEVDORev. A
1xEVDORev. 0
1xEVDORev. B
UMB
LTE
WiMAX FDD
EDGEHSDPA
HSPA+
‘Peak rates are the maximum under a perfect RF condition. Actual rates may
be much lower depending on RF conditions’
Peak rate doubles every year and is increasing !
WiMAX TDD
Wireless Access Technologies
� Speeds: 100% per year !
� An even faster, cheaper
bandwidth capability
� Ubiquitous broadband coverage
Wireless Phone Explosion
We’re almost at the cell phone ‘saturation’ point . . . But there’s still lots of device growth as consumers swap older technology with new 3G/4G phones
280M Phones90% Penetration
0
50
100
150
200
250
300
Subs (M)
2005 2006 2007 2008 2009 2010 2011 2012
North American Subscribers
1G/2G/2.5G 3G (CDMA2k/WCDMA)
Based on CDG, GSMA and internal estimates
US Subscribers
The Handset as the Enabler of New Usage
� Experimenting With New Applications
� Increasing The Time Spent on Communication Experiences
iPhoneMobile
Video
Social Network Access
Facebook YouTubeGoogle
Maps
% of users 30.9% 49.7% 20.0% 30.4% 36.0%
All phones 4.6% 4.0% 1.5% 1.0% 2.6%
Source: MMetrics, March 2008
iPhone Internet Music eMail
% of time spent 12.1% 11.9% 10.4%
All phones 2.4% 2.5% 2.8%
Source: iSuppli, April 2008
Smart devices are key to high growth in applications and revenue from new business models
Watching a single half hour video on the Internet consumes as much bandwidth as sending 200 emails a
day for an entire year.
Technology
Other Key Technology Trends
Trends
Integrated Circuits x2 in density/speed every 18-24 months
Photonics x2 in transmission capacity every year
Storage x2 in storage density every 9 months
Displays x2 in pixels every 2 years
Wireless x2 in peak data rate every year
Software x2 in operating system size every 2 years
Key Small/Medium Business (SMB) Needs
Ubiquitous connectivity
Wireless enablement
Other hosted
applications
Local Phone
LD
Broadband
Internet
Access
� T1 / DSL/ Fiber / Ethernet
� 1.5 Mbps / 10 Mbps / 100 Mbps /
1 Gbps / 10 Gbps / 100 Gbps
(Bandwidth needs of SMBs are
gorwing rapidly)
� Multi-location VPNs, LAN emulation
� Hosted Messaging, Security, Back-up
Services, Hosted Website, Video
conferencing, Teleworker Support
� WiFi/3G/4G, Fixed-Mobile
Convergence, Dual Mode Phones
� One stop for all voice needs,
Hosted VoIP, unlimited calling plans
Fixed Mobile Convergence
� Cellular –WiFi Convergence
� Ability for phone to work in cellular mode (outside) and WiFi mode (inside)
� Cellular Extension
� Ability for mobile phone to be part of PBX/Centrex group – to leverage extension dialing, call park/retrieve, call pick-up, etc.
� Seamless Handoff
� Ability to start a call in wireless or WiFi mode, and transition inside/outside without the call dropping
� Femto Cell
� WiFi like device that works at the same macro cellular spectrum in the home
Ubiquitous Broadband – At Home, At The Office, and On The Road
…optimized for any device…
Ultra High Bandwidth Services…
Handsets Vehicles
� Transport-centric services
� Fully interactive experiences
� Media/content portability
Gaming/Tablet Connected Home
…enabling a seamless service experience
� Rich multiscreen entertainment experience
Paradigm Shift to Wireless
Communication in India
• Pros and cons of Wireless systems
– Advantages• Convenience
• Quick access regardless one’s position
• Low cost in setup and maintaining
– Disadvantages• Limited frequency spectrum
• Complex technologies
• Quality of signals
• Power supply for the small portable units
• Health Effects on human being / society
Technical Challenges in Wireless
Communications
•17
•• NoiseNoise
•• SNRSNR
•• Multipath fadingMultipath fading
•• InterferenceInterference
•• Limited PowerLimited Power
•• Frequency selective fadingFrequency selective fading
•• Doppler shiftDoppler shift
Technical Opportunities
•18
••Robust Multiplexing and Multiple Access Technique : Robust Multiplexing and Multiple Access Technique :
OFDM/OFDMAOFDM/OFDMA
••Intelligent user allocation : Intelligent user allocation : Dynamic Resource Allocation and PacketDynamic Resource Allocation and Packet
SchedulingScheduling
••Integrated Optimization:Integrated Optimization: Cross Layer OptimizationCross Layer Optimization
••Link Adaptation : Link Adaptation : Adaptive Modulation and CodingAdaptive Modulation and Coding
••Spatial Multiplexing: Spatial Multiplexing: MIMOMIMO
••Performance Optimization:Performance Optimization: CrossCross--layer layer DesignDesign
••Cognitive RadioCognitive Radio
Indian Telecom Industry – A Lucrative Option
•In recent years, the Indian telecom industry has witnessed phenomenal growth. A conducive business environment,
favourable demographic outlook and the political stability enjoyed by the country have contributed to the growth of the
industry. India achieved the distinction of having the world's lowest call rates (2–3 US cents), the fastest sale of million
mobile phones (1 week), the world's cheapest mobile handset (USD 19) and the world's most affordable colour phone (USD
31).
•Indian Telecom Industry
� One of the fastest growing cellular markets
in the world in terms of number of
subscriber additions – 19.35 million in 3
months (April to June 2011)
� Expected to reach total subscriber base of
about 500 million by 2011 (i.e., more than
one phone for every household)
� Annual growth rate of the telecom
subscribers – 54.7 percent (2011-12)
� More GSM subscribers than fixed-line
subscribers
Indian Telecom Industry – Facts
� Total telecom subscribers – 225.21 million
(June 2011)
� Tele density – 39.86 percent (June 2011)
� Number of new mobile subscribers added
every month – 7.34 million (June 2011)
� Telecom equipment market – USD 27,100
million (2011–12)
� Handset market – USD 5,750 million (2011–
12)
Number of mobile subscriber will propel the total subscriber base
to 500 million by 2011
225.21
206140.3
98.47653
19.9
5.17.0
9.1
12.8
18.3
0
50
100
150
200
250
2002–03 2003–04 2004–05 2005–06 2006–07 2007–08
(As of June
2007)
Subsc
ribers
(in
millio
n)
0
4
8
12
16
20
24
Tele
de
nsity
(in
perc
ent)
Telecom Subscriber Base Teledensity
� The telecom subscriber base has witnessed an
explosive growth; the additions in the current year
registered a growth of approximately 47 percent over
the previous year.
� The subscriber base registered a CAGR of 40.4
percent for 2002–03 to 2006–07.
Telecom Subscriber Base and Teledensity in India
Market Share* of Wireless** Operators (As of June 2010
Airtel
23%
Reliance
Communications
17%
TTSL
9%
BSNL
17%
Others
8%
Hutch
17%
Idea
9%
The state-owned BSNL was the second largest service provider after Bharti
Airtel (23 percent) in the Indian wireless telecom market with a market
share of approximately 19 percent for the year ending March 2007.
•** Includes GSM, CDMA and WLL-F services•* In terms of Subscriber Base
•GMPCS services were launched in India
in 1999. These services allow a
subscriber to communicate from any
point on earth through a handheld
terminal. Moreover, the telephone
number remains unchanged,
irrespective of the subscriber’s
location.
Various other services emerged by leveraging the telecom services
industry
•Public Mobile Radio Trunked Services
•PMRTS have not grown to their expected
potential in India. The high licence fee leaves a
very thin margin for services providers; thereby,
inhibiting its growth. About 31,000 subscribers
are currently availing this service in India from
12 different operators.
•In 1995, radio paging services emerged as a
promising segment in India. However, this
segment could not compete with cellular
services in general and SMS technology in
particular, and is currently shrinking. At
present, only four radio paging service
providers are present in the Indian market.
•Very Small Aperture Terminals (VSAT)
•The market for VSAT services increased by
5.73 percent during the quarter ending in
December 2006, and the segment had a total
subscriber base of 55,070. HCL Comnet is the
largest of the eight players functioning in the
market.
•GMPCS*
• Radio Paging
•Other Telecom Services
•* Global Mobile Personal Communication by Satellite
The emergence of private players and new technologies have provided a
strong impetus to the growth of Internet and broadband services. The quality
and penetration of these services have undergone changes, with significant
improvement in the telecom infrastructure. The Internet subscriber base
registered a CAGR of 60 percent for the period 1997–98 to 2010–11.
Others, 14.0%
MTNL, 19.0%
BSNL, 45.2%
Bharti Airtel,
6.8%
Reliance,
6.1%
Sify, 8.9%
Market Share of Top Five Internet Service Providers (as of quarter ending March 2010)
0.140.28
0.95
3.043.42
3.64
4.55
5.55
6.94
9.27
0
2
4
6
8
10
19
97
–9
8
19
98
–9
9
19
99
–0
0
20
00
–0
1
20
01
–0
2
20
03
–0
3
20
03
–0
4
20
04
–0
5
20
05
–0
6
20
06
–0
7
Inte
rnet
Su
bs
cri
be
rs (
In m
illio
n)
Internet Subscribers: 1998–2007
BSNL and MTNL caters to more than two-thirds of Internet subscribers in
India.
Private players are catching up fast due to increased penetration of Internet
and broadband services in India.
The telecom market will experience high penetration of Internet services
with the support from government policies and introduction of novel
technologies in India.
•Broadband services to drive Internet penetration in India
India had 2.52 million broadband connections at the end of June 2011.
Indian telecom handset market booming along with mobile
services industry
1,6101,966
3,231
4,750
0
1,000
2,000
3,000
4,000
5,000
2003–04 2004–05 2005–06 2006–07
US
D M
illio
n
• Mobile Handsets Market in India: 2004–10� The Indian handset market grew at a phenomenal rate in
2006 with the sale of approximately 30–35 million handsets.
It is estimated that by 2011, sales of mobile handsets will
reach 150 million units.
� Competitive pricing has triggered the growth of coloured
handsets, which accounted for 65 percent of the market in
2006; whereas, the share of monochrome handsets has
declined to 35 percent.
� Mobile phones are available at prices as low as USD 28–35.
� Camera phones currently occupy 15 percent of the sales
volume.
ZTE
4%
Nokia
53%
Motorola
11%
LG
11%
Sony Ericsson
6%
Huaw ei
1%Haier
1%
Samsung
6%
Others
7%
•The CDMA category is growing faster than the GSM
category. It captured 25 percent of the market
volume in 2005–06 as against a 20.5 percent share in
the previous year.
•Market Share of GSM and CDMA Handset Manufacturers: 2006–07
•Overall, Nokia has a market share of 53 percent; it
dominates the GSM mobile handsets with a market
share of approximately 73 percent.
•LG dominates in the CDMA handsets market with a
market share of 60 percent.
� World’s largest democracy
� Independent judiciary
� Skilled and competitive labour force
� Fifth largest telecom network in the world; second largest among the emerging economies after
China
� On an average, about 6–7 million new users added per month, making India the world’s fastest
growing wireless services market
� Liberal Foreign Investment Regime–FDI limit increased from 49 percent to 74 percent; the rural
telecom equipment market is also open to large investments
� Among the countries offering the highest rates of return on investment
� The large untapped potential in India’s rural markets–1.9 percent teledensity in rural markets as
compared to the national level of 18 percent
� Expected to become the second largest telecom market by 2010
� The government promoting telecom manufacturing by providing tax sops and establishing telecom
specific Special Economic Zones
� Fully repatriable dividend income and capital invested in telecom equipment manufacturing
•India: An Ideal Destination for Investments in Telecom Sector
Indian Telecom Industry Framework
• Indian Government Bodies
• Independent Bodies
Wireless Planning and Coordination (WPC)
Department of Telecommunications
Telecom Commission
Group on Telecom and IT (GoT-IT)
Telecom Regulatory Authority of India (TRAI)
Telecom Disputes Settlement and Appellate
Tribunal (TDSAT)
Handles spectrum allocation and management
DoT – Licensee and frequency management for telecom
Exclusive policy making body of DoT
Handles ad hoc issues of the telecom industry
Independent regulatory body
Telecom disputes settlement body
•Regulatory Framework provides level playing field for all operators
They formulate various policies and pass laws to regulate the telecom industry in India.
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.
The Department of telecommunications (Government of India) is the main
governing body for 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.
Go-ahead to the CDMA technology
•INDIA
Private players were allowed in Value Added Services
National Telecom Policy
(NTP) was formulated
1992
1994
1997
Independent regulator, TRAI, was established
NTP-99 led to migration from high-cost fixed
license fee to low-cost revenue sharing regime
1999
2000
2002
BSNL was established
by DoT
ILD services was opened to competition
Internet telephony initiated
Reduction of licence fees
2003
Calling Party Pays (CPP) was
implemented
Unified Access Licensing
(UASL) regime was
introduced
Reference Interconnect order was issued
2004
Intra-circle merger guidelines were established
Broadband policy 2004
was formulated—targeting 20
million subscribers by
2010
2005
FDI limit was increased from
49 to 74 percent
Attempted to boost Rural telephony
2006
Number portability was proposed (pending)
Decision on 3G services (awaited)
2007
•Department of Telecommunication (DoT) is the main body formulating laws and various regulations for the Indian telecom industry.
•Various important regulations and laws have been passed in the Indian telecom industry post-liberalisation era
•ILD – International Long Distance
Vodafone purchased stake in Hutch from Hong Kong's Hutchison
Telecom International for USD 11.08 billion.
Telekom Malaysia acquired a 49 percent stake in Spice
Communications for USD 179 million.
Maxis Communications acquired a 74 percent stake in Aircel for USD
1.08 billion.
Ericsson to design, plan, deploy and manage Bharti Airtel network and facilitate their expansion in the rural areas, under a USD 2 billion
contract.
116 129
680
521
100
300
500
700
2003–04 2004–05 2005–06 2006–07
FD
I (U
SD
millio
n)
Recent Deals in Telecom Sector
FDI in Telecom Sector
The Indian telecom industry has always attracted foreign
investors. In fact, the cumulative FDI inflow, during the August
1991 to March 2007 period, in the telecommunication sector
amounted to USD 3,892 million. It is the third largest sector to
attract FDI in India in the post-liberalisation era.
FDI calculation takes into account radio paging, cellular mobile
and basic telephone services in the telecommunication sector.
•FDI and other M&A activities increasing in number
Reliance Communications Limited has sold a five percent equity share capital of its subsidiary Reliance
Telecom Infrastructure Limited to international investors across the US, Europe and Asia. The deal was
worth USD 337.5 million.
The Indian telecom industry has a 74 percent FDI limit in the
telecom services segment.
The GoI has permitted 100 percent FDI in manufacturing of
telecom equipment in India.
•Major trends in the telecom sector is increasing M&A activity, de-regulation of telecom policies and growing interest of international investors.
Basic Services Operators
BSNL
MTNL
•Major Players in different segments of Indian telecom industry
Reliance
TTSL
GSM Services Operators
Airtel
Vodafone
Idea
Reliance
TTSL
BSNL
CDMA Services Operators
Reliance
Internet Services Operators
BSNL
MTNL
Reliance
TTSL
BSNL
Airtel
•TTSL – Tata Teleservices Ltd.
•MOBILE SERVICES
•BSNL – Bharat Sanchar Nigam Ltd.
•MTNL – Mahanagar Telecom Nigam Ltd.
Emerging technologies – 3G and WiMax to assist in penetration of
telecom services in India
• WiMAX has been one of the most significant developments in wireless communication in the recent
past. Since this mode of communication provides network access in inaccessible locations at a speed
of more than 4 Mbps, it is expected to be a major factor in driving telecom services in India,
especially wireless services. Thus, it will lead to the increased use of telecom services, Internet,
value-added services and enterprise services. WiMAX is expected to accelerate economic growth and
assist in providing better education, healthcare and entertainment services.
� It is estimated that India will have 13 million WiMAX subscribers by 2012.
� Aircel is the pioneer in WiMAX technology in India.
� The state-owned player, BSNL, aims to connect 74,000 villages through WiMAX.
� Bharti, Reliance and VSNL have acquired licenses in the 3.3GHz range to utilise the opportunities
offered by this domain.
• The Indian government plans to auction the spectrum for 3G services by inviting bids from
domestic as well as foreign players, and creating a competitive environment that offers
better services to consumers. Therefore, the 3G spectrum is among the major investment
opportunities and growth drivers of the telecom industry.
� The immense potential for 3G is reflected by the 30–40 percent annual growth in Value-
Added Services.
� Cell phone manufacturers are striving to develop USD 100 priced 3G handsets for the Indian
market.
� India expects to replicate its 2G growth in 3G services.
THANKS!