Indian Telecom Sector

By: Group 1

General Information

Wireless SubscriberTotal Wireless Subscribers 886.30 Million

% Change Over the previous Quarter 1.81%

Urban Subscribers 526.63 Million

Rural Subscribers 359.67 Million

GSM Subscribers 824.06 Million

CDMA Subscribers 62.24 Million

Market Share of Private Operators 88.73%

Market Share of PSU Operators 11.27%

Teledensity 71.69

Urban Teledensity 138.94

Rural Teledensity 41.95

Wireless Subscriber Market Share

Bhart

i Airt

el

Vodaf

one

Relia

nce

Comm

unicat

ion

Idea

BSNL+M

TNL

TATA

Aircel

Oth

ers

0

20

40

60

80

100

120

140

160

180

200 187

150

120 119106

67 6152

Wireless Revenue Market Share

30%

23%8%

15%

7%

9%

5%3%

Bharti Airtel Vodafone Reliance Communication Idea

BSNL+MTNL TATA Aircel Others

Bharti Airtel

Company Background

#1 Operator in India

1.8bn Addressable Population

US$ 14.7bn Revenue

#4 Operator in the World

#3 in – country wireless service operator in the

world

# 4 Operator In Africa

Present in 20 Countries

The “Airtel” Brand

Vision: Become the most loved brand by 2015

Amongst the Top 100 of Most Valuable Global Brands List

Successfully unified operations across the globe under the umbrella of Airtel.

Built Strategic Partnerships in Business Delivery Model

The Strategic Partnership Model has been a key enabler for Bharti Airtel to lower its costs

Bharti Airtel Limited Organizational Structure

Strategy

Innovative Business

Model driving

Value and Efficiency from Scale

Leading Emerging Markets

(Asia & Africa)

Present Across Non Wireless

Segments

Growth Strategy:

Mobile Data,

Increased Penetration and New Services

AIRTEL

Uninor : The story of rising from the Ashes

By Shiladityo Bhattacharya

Brief IntroductionThe Norway based Telenor Group which had a world wide footprint in the

telecom sector entered into the rapidly growing Indian telecom industry in April 2009.

The Telenor group took up a 67.25% stake in Unitech wireless in 2009 and started its operation in a market which was highly competitive.

The C.E.O of the India operation is Morten Karlsen Sorby and Sigve Brekke is the Asia Group CEO.

There are external representatives on the board of directors, two from the auditors side one from the bankers side.

It was not even a year that Uninor group had started their operation in India that they got entangled in controversies regarding illegal allotment of spectrum in 2G scam.

In 2011 a Supreme court verdict cancelled all their licenses but they came back strongly a year after grabbing 6 of 22 total circles in India through an open buyout process organized by the Indian Government.

Organizational Structure

Morten Karlsen SorbyC.E.O

Amaresh KumarChief Product Officer

Anne BitteChief Human Resource

Officer

Vivek AnandC.F.O

Pooja ThakranChief Communication Officer

Rajeev SethiChief Marketing Officer

Core strategy before the 2G scam and changes after it

The strategy of Uninor was always to provide a quality telecom service at the cheapest rate.

Their tagline “Sabse Sasta” also impresses upon the point that they are the cheapest provider of telecom service approximately 40% lower than it’s nearest competitor.

They had started their operation in 13 of the 22 circles before the 2G scam and were mainly following a Cost Leadership strategy.

They were growing aggressively but their growth got stalled due to cancelling of their licenses which lead to losses mounting to 3-4 billion NOK.

Actions they took to revive their operations after facing trouble in the 2G scam case :

1. They reduced their operation from 13 circles to 6 circles.

2. They gave up the most revenue generating circles of Mumbai as they realized the market has already become too much competitive.

3. They chose to operate in circles of Uttar Pradesh west and east, Bihar , Andhra Pradesh and Goa.

4. These circles constitutes 50% of the total population of India but only 28.7% of it were using telecom services.

Strategy Implementation and Execution

After the great loss that the Telenor group went through due to Supreme Court verdict they have bounced back by breaking even in five of all 6 circles that they operate in India. This is due to the strategy adopted by the top management level of Uninor.

Blue Ocean Strategy : Uninor had selected circles where very few companies provide service and thus Uninor was able to create a market of it’s own rather than competing in a market where rivalry is too high and gaining customers is difficult.

They targeted mainly a segment and area where both the internet penetration and the telecom service has been limited and thus they were able to capture the market .

They are the cheapest mobile service company in the country and thus they believe in achieving operational efficiency.

Strategy Implementation and Execution

Strategy Execution : 1.They only targeted 6 circles among 22 circles as they were

underserved circles and thus they were targeting the rural people as well as middle class people.

2. They achieved operational efficiency by reducing hiring of personnel and asking the village headman, insurance agent to distribute the SIM card to the rural people as this people have better network.

3. They made a deal with other big tower manufacturing companies so that they are able establish strong business in areas where other competitors are also present.

Strategy Implementation and Execution

Strategy Execution and Sustainability :They are providing rural people with very limited service and they

have small express stores in tehsil of an area.They purchased the 2G equipment at the end and companies like ZTE,

Huawei , Erricson , and Nokia-Siemens etc bidded for which reduced the cost of operation further less.

They gave customer care responsibility to Wipro which again operated with less number of people and thus reducing the overall cost.

The operational efficiency that it has been able to achieve can only sustain if it doesn’t expand into other circles and also not to start other services like 3G or 4G.

The spending on the IT was further reduced .

BHARAT SANCHAR NIGAM LIMITED (BSNL)

Introduction

BSNL is a state owned telecommunication company.

It was incorporated on 15th Sept, 2000. Largest provider of fixed telephony and 4th largest

provider of mobile telephony in India It has a customer base of 117 million as on Jan’14 It has its footprints throughout India except for

Mumbai and Delhi. BSNL has 12.9% market share in India

Structure

CHAIRMAN AND MANAGING DIRECTORSHRI RAKESH KUMAR UPADHYAY

DIRECTOR (CFA) Shri N.

K. Gupta

Director (Finance) Shri KCGK

Pillai

Director (HRD)

Shri A.N. Rai

Govt. Director Shri

Shahbaz Ali

Strategy Analysis

Penetration in the rural market. Competitive pricing policy. Safe Player : Follower Continuous training to employees to enhance the

performance Implementation of ERP

Challenges Quality of network, does not seem to improve

despite competition Lagging in providing Value Added Services compared

to competitors Non Flexible Policies and procedural delays. Lack of market research and poor defined strategy Excess aging manpower. Lack of familiarization in new techniques.

Restructuring BSNL should have Clear Technology Strategy in line

with its mission. Should focus on Customer Orientation Strategy Extensive use of IT Redefine procurement process to shorten the

Purchase – decision cycle Providing more Value Added Services Should be a leader rather than follower, start acting

proactively Should adapt Standardization and flexibility And most importantly, BSNL need to overhaul its

Human Resource Management strategy

•MTNL was setup on 1st April 1986 by government of India having 56.25% stake in the company.

Incorporated•MTNL is the principal provider of fixed-line telecommunication sand wireless internet service in the two metropolitan cities of Delhi and Mumbai

Services

•The company has 2.78 million and 2.88 million wireless subscribers in Delhi and Mumbai respectively, fifth in terms of subscriber

Subscribers

FinancialsMTNL recorded loss for several years and has recorded the profits of Rs 78.25 billion during 2013-14 as compared to the losses of Rs 53.21 billion during 2012-13.

MTNL

Organisational Structure

Problem: Stiff competition from private players, low brand perception, mounting operational costs, losses on the financial front and a dwindling wireline business have taken state-owned telecom operator Mahanagar Telephone Nigam Limited (MTNL) to bad status as compared to its earlier monopoly status.

Strategy: To restore company’s position in the telecom industry and undertaking several short, medium and long term revival measures and to achieve the highest level of customer satisfaction by increasing the consumer base.

{The Government long term measures, includes merger of BSNL and MTNL, would attempt to position these PSUs to emerge as market leaders in the converged telecommunication market}

The employee cost as a percentage of revenue was over 103 per cent for MTNL against the industry average of less than 5 per cent, thus MTNL planning to reduce the headcount and have asked DoT to clear a voluntary retirement scheme to be offered to 15,000 employees out of total 45000 employees.

Faced with a cash crunch and financial losses, MTNL decided to go in for revenue-sharing arrangements with other companies to launch new services. For instance, it has invited expressions of interest for outsourcing its BWA business and has hired global consultancy firm PricewaterhouseCoopers to search for franchisees for BWA services.

Changes in the company as per the strategy

DoT- Department of Telecommunication BWA – Broadband Wireless Access

Company started evaluating employees performance under DoTs guidance and planning a performance review of top MTNL officials on a monthly basis to keep a check on non-performing officials Moreover, the company’s top management has warned its employees that there could be a cut in pay in future if they fail to improve their performance as per the company’s expectations.

These suggestions were given Sam Pitroda, he was adviser to the Prime Minister then.

By: Ayushi Thakur

13A3HP020

Company Background

#2 Operator in

India

Customer base of approx. 160

million.

Revenue of 37,606 crore in 2014.

(India)

Strong presence in Europe, Middle east,

Africa, Asia Pacific and United

states.

World’s 2nd largest mobile telecom.

company

The “VODAFONE” Brand

Vision To be one of the most

trusted companies in

the market.

To enrich customer’s

lives through unique

power of mobile

communication.

Mission• Providing customers with

affordable, innovative and

user friendly

communication services.

• Aspire to be the most

respected and successful

telecom company in India.

Vodafone India Private Limited Structure

Name TitleMarten Pieters Chief Executive Officer

Analjit Singh Non-Executive Chairman and Partner

Sunil Sood Chief Operating Officer

Vittorio A. Colao Independent Director and Chief Executive Officer of Vodafone Group

New Vodafone structure• Introduction of Chief operating officer and chief commercial

officers

• Mr. Sunil Sood takes charge as the COO, and Mr. Sanjoy

Mukherji takes charge as the CCO

• Introduction role of 4 directors( operations)- for north east

west south to oversee the circles

• Zonal heads report to the COO

• CCO will have customer experience, retail, quality

management under him

• Head for distribution and modern trade will report to the

CCO

Key people in Vodafone IndiaName Title

Marten Pieters

Analjit Singh

Sunil Sood

Vittorio A. Colao

S. Murli

Nicholas Jonathan Read

Rajesh Dongre

Sanjoy Mukherjee

Chief executive officer

Non executive chairman and partner.

Chief operating officer

Independent director and CEO of vodafone group.

CEO of Andhra Pradesh

CEO Africa, Middle East and Asia Pacific region

CEO of Rajasthan

Chief commercial officer

Increase exposure in emerging markets Drive operational performance through

value enhancement and cost reduction Innovate and deliver on consumers total

communications needs Actively manage portfolio to maximize

returns Strategic tie ups and alliances

Strategy

Strategic alliance with: Reason

ICICI Bank To launch the M-Pesa service.

Rockstand( An android app) Purchase of books and magazines

Karbonn and Micromax Promote Mobile data services

Star India Create sports offering-VODAFONE sports

Recent strategic moves

What do they want to achieve?

Always best

connected

Unmatched customer

experience

Integrated free

solutions

“POWER TO YOU: To find that spark that empowers you is why we are in business”

How do they do it?

Growing importance

of data

Increasing demand for

communications for both

enterprises and consumers

Increasing range of

competitors

Shaped by following industry trends

An excellent network

experience

Simplified and cost efficient

operations

Supported By

By : RAJNEETA DAS13A3HP061

COMPANY BACKGROUND•Airce

l Incorporated in 1999.

•Alliancebetween Maxis Communications Berhad of Malaysia (74% equity) and Sindya Securities & Investments Private Limited (26% equity).

Incorporated

•5.4% market share is the 7th largest mobile telecom player in India

Market Share

•Total subscriber base of 64.88 million while 57.76% of the subscriber base was active at the end of June 2012.

Subscriber Base

Revenue

Aircel revenue market share is 5 percent.Total revenue earned by Aircel in 2014 amounts to Rs 1,635.18 crore.

MISSON AND VISION

MISSION

• We at Aircel always think of in fresh and innovative ideas about the needs of our customers and how we want them to feel . We deliver what we promise and go out of our way to delight the customer with a little bit more.

VISION

• By 20120 Aircel will be the most admired brand in India

• Loved by more customers• Targeted by top talent• Benchmarked by more business

Restructuring

PROBLEMSMobile service provider, Aircel is under tremendous pressure of debt, priced around whopping Rs20,000 crore.

STRATEGYAircel may go through corporate restructuring to ease its Rs20,000 crore debt.

PENETRATION STRATEGIESMicromax Aircel team up to grow data market

Snapdeal.com and Aircel enter into a strategic partnership

Aircel offers free Facebook access to its customers; Launches ‘Facebook for All’

Aircel launches innovative product for new customers in Bihar; offers extensive validity of 6 months

Aircel to offer exclusive deals and discounts to its customers with ‘Aircel Joys’

Aircel introduces ‘Blyk’ in India

Organization Structure

Strategic Positioning While, Aircel will offer one stop solutions to address the increasing data

demands, MediaTek along-with Micromax’s expertise in product design and performance will redefine the user experience creating a win-win ecosystem for the Indian users.

With online shopping emerging as an easier, faster and more effective way of shopping Aircel tying up with Snapdeal wanted to target the youth segment to increase data penetration and usage amongst its user base. Aircel’s innovative data offerings coupled with Snapdeal.com’s robust online channel and reach will helped in a holistic experience and great value for money to their customers.

In its endeavor to offer best value for money products to its customers in Bihar, Aircel has launched a unique product with an extensive validity of 6 months that will provide customers a tariff of 1.2p/2 sec on local calls. In addition, customers will get talk time of Rs. 30 valid for 90 days and 100 MB free 2G data valid for 30 days. The product offers convenience to the customers and they can enjoy best value for money tariffs.

Aircel has partnered with mydala.com to launch Aircel Joys, that would let their customers avail exciting deals and discounts up to 90% in a range of categories such as Entertainment, Lifestyle, Shopping, Hospitality, Personal Care and more.

Blyk on Aircel brings for the youth a truly exciting and interactive experience and even great Brand engagement. It gives them the Best deals i.e. Blyk on Aircel Lifetime membership along with irresistible offers by Aircel such as unlimited dialer tunes up to a period, Aircel Pocket Internet, Music connect and much more. This therefore, becomes a movement among the Youth and opens to them a world of possibilities.