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AN OVERVIEW OF THE TELECOM INDUSTRY

INDUSTRY ANALYSIS PROJECT:

TELECOMMUNICATIONS INDUSTRY
INTEGRATED MBA
MBM - 414
GROUP 4

PRESENTED BY:
Neha Shivani

Saksham Maheshwari

Shalu Verma

Simran Sachdeva

Sumati Khatri
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AN OVERVIEW OF THE TELECOM INDUSTRY

SERIAL NO. TOPIC PAGE NO.

MACRO ANALYSIS 3
1. Abstract 4
2. Introduction 4
3. Executive summary 5
4. 1G, 2G….& 5G:The Evolution of the G’s 6
5. Segmentation 8
6. Market Overview 9
7. Products 13
8. Role of Government regulations and policies 17
9. Role of technological Innovations 18
10. Strategies 19
11. Future of Telecom Industry 20
12. Notable Trends 21
13. Telecom companies and their services 24
14. Indian Telecom Industry Services 25
15. Growth Drivers of Telecom Industry 27
16. Technologies in Telecom 29
17. Government Policies 29
18. Market Size 31
19. Tax Structure 31
20. Global Markets 31
21. Key Risks and Opportunities 34
22. Top 10 Companies 35
23. Company Profiles(Reliance Jio, Airtel & Vodafone 39
Idea)
24. Business Models – Michael Porter’s Five Forces 47
Analysis
25. SWOT Analysis 50
MICRO ANALYSIS 53
26. Reliance Jio 54
27. Data Collection 54
28. Comparison Between Macro and Micro Business 55
Models – Porter’s Model
29. Comparison of Micro and Macro SWOT Analysis 63

Bibliography
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MACRO ANALYSIS
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ABSTRACT

The Telecommunications Industry of India is one of the vast and leading industries in the world

connecting different parts of the country through various modes like telephone, radio, television,

satellite and internet. The Telecom Regulatory Authority of India governs this industry by

providing a regulatory framework and favorable environment for its efficient operation. The

Indian telecom industry stands as the second- largest in the world due to its rapid advancement

and is in cut-throat competition with the telecom industries of the other developed countries. The

telecommunication services offered by this industry are easily accessible at affordable prices to

the customers of urban and rural areas of India. India’s telecom network encompasses a highly

developed and unique technology in the world. The present study has therefore been undertaken

to analyze the history and evolution of Indian Telecom Industry while emphasizing upon its

major segments, the Government Telecom policies followed for its systematic functioning and

its growth and development in the present scenario along with the future opportunities for

advancement.

INTRODUCTION

The Indian Telecom Industry is considered to be a vital tool for the development of the country

on the whole by contributing towards the immense growth, quick expansion and upgradation of

various sectors of the nation. This industry increases the GDP of India, earns profit for the Indian

Government and creates employment opportunities for a great number of people. The Indian

Telecom Industry is very huge consisting of companies that make hardware and also produce

software. Presently, it contributes to a revenue of USD 33,500 million. Along with the

Government owned telecom units, the Indian Telecom market has also attracted many private

operators to enter here who started offering their telecom services as fixed communication,
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mobile communication and data services to the customers at the most reasonable prices (see

Table IV). The Government of India has adopted several measures to provide a business-friendly

environment for companies in the Indian Telecom market while competing with each other. Due

to the rapid advancement in technologies, the telecom operators of India are working actively in

order to adapt themselves to the changing technology to continue existing in the market.

EXECUTIVE SUMMARY

 India has the second largest telecom network in the world.

 Total subscriber base in the country stood at 1,183.77 million at the end of April 2019.

 India has the second highest number of internet subscribers globally.

 The internet user base in India has crossed 500 million mark and is likely to reach 627 million

by end 2019.

 Telecom penetration, also known as tele-density, has grown rapidly over the course of the past

few years.

 Tele-density grew from 18.23 per cent in FY07 to 90.05 per cent in FY19.

 Availability of affordable smartphones and lower rates of data are expected to drive growth in

the Indian telecom industry.

Moreover, India is also one of the largest data consumers globally. Total mobile data usage in

the country grew 109 per cent year-on-year to 4,867 PB per month in December 2018.

Telecommunication ratings in the country are expected to start rising within the next two

quarters (Q3 and Q4 2018-19), providing higher pricing power to incumbent players.

The Government of India unveiled the National Digital Communications Policy, 2018 in

September 2018. The policy aims to attract US$ 100 billion worth of investments and generate 4

million jobs in the sector by 2022.

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1G, 2G.…& 5G: THE EVOLUTION OF THE G’S

Telecommunication and networking has been and will be one of the core technologies in helping

the evolution of mankind and technology itself. If it wasn’t for it for these channels of

communications and data transmission, we would probably still be in an era where technology

isn’t as advanced as today.

Wireless communication technology inside cell phones and other mobile devices has evolved

over several decades. Starting with the then revolutionary 1G (referred to as the earliest form of

voice only network) all the way to the 4G of today and the 5G of the near future. But what has

really changed? and what is the core driving principles of these wireless communication

technology?

First off, the G in “4G” or “5G” stands for generation and the number is just a representation of

the evolution of technology. Currently, as you may know, we are using the 4th generation of

wireless communication technology. But let’s start from where it all began:

1G and 2G

There never was something called as 1G at first. It basically was a network with only voice call

capabilities and only got the name 1G after 2G was put to use. During the 2G era, that lasted for

quite a while from 1980’s to 2003, there were quite a few advancements made within the

spectrum itself such as GSM, GPRS and EDGE.

3G

This was a big revolution in terms of technological advancement for network and data

transmission. 3G had and has speed capabilities of up to 2 mbps. It enabled smartphones to

provide faster communication, send/receive large emails and texts, provide fast web browsing,
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video streaming and more security amongst others. It was widely based on CDMA2000 (Code-

division multiple access) and EDGE technologies. Now you might wonder why EDGE? Well,

because EDGE was so advanced it was able to provide enough capabilities to be considered as

3G. CDMA2000, on the other hand, operated on similar key concepts but did it better. It enabled

multiple channels to communicate at one same thus improvising on the over speed and

connectivity.

4G

The 4G standard sets several requirements for mobile networks including mandating the use

of Internet Protocol (IP) for data traffic and minimum data rates of 100 Mbps. [LifeWire] which

was a huge jump from the 2 mbps for 3G. It is often referred to as MAGIC

 M – Mobile multimedia

 A – Anytime anywhere

 G – Global mobility support

 I – Integrated wireless solution

 C – Customized personal service

Soon after 4G, 4G LTE was introduced. LTE stands for Long Term Evolution and it isn’t as

much a technology as it is the path followed to achieve 4G speeds. It was a complete redesign

and simplification of 3G network architecture, resulting in a significant reduction in transfer

latency and thus, increasing efficiency and speeds on the network.

5G

It is still quite in its early stages and the technology likely to appear in the market only by 2020

at the earliest. Goals for future 5G include significantly faster speeds (a minimum of 1 Gbps and

perhaps up to 10 Gbps) plus lower power requirements to better support huge numbers of
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new Internet of Things (IoT) devices. It will have capabilities to provide faster dialling speeds,

multiple device connectivity, higher data speeds just to name a few.

There has been a lot of advancements in the field of wireless network communication over the

years in terms of overall development and change in core functionality, which has been crucial to

put us in a era that is driven by technology all around us and with 5G a couple years away,

technologies such as IoT, Cloud computing and AI will completely redefine our world by 2025.

SEGMENTATION

Telecom industry is divided into three segments

 Mobile (wireless) - Comprises establishments operating and maintaining switching and

transmission facilities to provide direct communications via airwaves.

 Fixed-line (wireline) - Consists of companies that operate and maintain switching and

transmission facilities to provide direct communications through landlines, microwave or a

combination of landlines and satellite link-ups.

 Internet services - Includes Internet Service Providers (ISPs) that offer broadband internet

connections through consumer and corporate channels.

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MARKET OVERVIEW

TELECOM SUBSCRIBER BASE EXPANDS SUBSTANTIAL

India is currently the second largest telecommunication market and has the second highest

number of internet users in the world.

 India’s telephone subscriber base expanded at a CAGR of 17.44 per cent, reaching 1,206.22

million during FY07–18.

 Tele-density (defined as the number of telephone connections for every 100 individuals) in

India, increased from 18.3 per cent in FY07 to 92.84 per cent in FY18.

 Total telephone subscriber base and tele-density reached 1,183.77 million and 90.05 per cent,

respectively, at the end of April 2019.

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WIRELESS AND RURAL SEGMENTS GAINING SHARE

The share of the wireless segment in India’s telecommunications market has increased steadily.

 As of March 2019, the wireless segment comprises 98.17 per cent and in April 2019 it reached

97.04 per cent of telephone subscriptions, compared to 95.90 per cent in FY11.

 Similarly, share of rural subscribers in total telephone subscribers has surged as

telecommunications penetration has increased.

 As of March 2019, rural subscribers form 43.46 per cent of total telephone subscribers and in

April 2019 43.33 percent, compared to 33.35 per cent in FY11.

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WIRELESS SUBSCRIPTIONS WITNESS ROBUST GROWTH OVER THE YEARS

Wireless subscriptions have grown robustly over the past few years.

 Between FY07-18, wireless subscriptions in the country increased at a CAGR of 19.61 percent

to 1,183.41 million.

 The growth in wireless subscriptions has led to a significant rise in wireless tele-density.

 Wireless tele-density of India has increased more than five-fold from 18.23 per cent in FY07

to 92.84 per cent in FY18.

 At the end of April 2019, wireless subscriptions stood at 1,162.30 million while wireless tele-

density reached 90.05 percent.

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STRONG GROWTH IN BROADBAND DRIVES INTERNET ACCESS REVENUES

Total broadband subscriptions in the country increased at a CAGR of 60.03 per cent during

FY07–18 to reach 412.60 million. Subscriptions stood at 571.95 million, as of April 2019.

 The number of wired broadband subscriptions stood at 18.41 million, at the end of April

2019.

 Wireless broadband subscribers# stood at 553.54 million, at the end of April 2019.
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SURGING TELECOM REVENUES

Indian telecom sector’s gross revenue grew from US$ 32.05 billion in FY08 to US$ 39.49 billion

in FY18.

 Gross revenue of the telecom sector stood at Rs 175,219 crore (US$ 25.04 billion) between

September-December 2018.

 Indian telecom sector’s revenue is expected to grow by 7 per cent in FY20 backed by

stabilizing tariff wars and increased spending by subscribers due to minimum recharge plans.

PRODUCTS

1. Optical fiber :- Optical Fiber is a flexible, transparent fiber made by drawing glass (silica) or

plastic to a diameter slightly thicker than that of a human hair. Optical fibers are used most

often as a means to transmit light between the two ends of the fiber and find wide usage

in fiber-optic communications, where they permit transmission over longer distances and at

higher bandwidths (data rates) than electrical cables. Fibers are used instead of metal wires

because signals travel along them with less loss; in addition, fibers are immune
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to electromagnetic interference, a problem from which metal wires suffer excessively. Fibers

are also used for illumination and imaging, and are often wrapped in bundles so they may be

used to carry light into, or images out of confined spaces, as in the case of

a fiberscope. Specially designed fibers are also used for a variety of other applications, some

of them being fiber optic sensors and fiber lasers.

2. Local area network (LAN):- LAN is a computer network that interconnects computers

within a limited area such as a residence, school, laboratory, university campus or office

building. By contrast, a wide area network (WAN) not only covers a larger geographic

distance, but also generally involves leased telecommunication circuits.

Ethernet and Wi-Fi are the two most common technologies in use for local area networks.

Historical technologies include ARCNET, Token ring, and appletalk.

The increasing demand and use of computers in universities and research labs in the late

1960s generated the need to provide high-speed interconnections between computer systems.

A 1970 report from the Lawrence Radiation Laboratory detailing the growth of their

"Octopus" network gave a good indication of the situation.

3. Modem :- (portmanteau of modulator-demodulator) is a hardware device that converts data

into a format suitable for a transmission medium so that it can be transmitted from computer

to computer (historically over telephone wires). A modem modulates one or more carrier

wave signals to encode digital information for transmission and demodulates signals to

decode the transmitted information. The goal is to produce a signal that can be transmitted

easily and decoded reliably to reproduce the original digital data. Modems can be used with

almost any means of transmitting analog signals from light-emitting diodes to radio. A

common type of modem is one that turns the digital data of a computer into
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modulated electrical signal for transmission over telephone lines and demodulated by another

modem at the receiver side to recover the digital data.

4. Mobile Phone: - sometimes shortened to simply mobile, cell or just phone, is a

portable telephone that can make and receive calls over a radio frequency link while the user

is moving within a telephone service area. The radio frequency link establishes a connection

to the switching systems of a mobile phone operator, which provides access to the public

switched telephone network (PSTN). Modern mobile telephone services use a cellular

network architecture, and, therefore, mobile telephones are called cellular telephones or cell

phones, in North America. Capabilities are known as feature phones; mobile phones which

offer greatly advanced computing capabilities are referred to as smartphones.

5. Landline Telephone :- is a phone that uses a metal wire or optical fiber telephone line for

transmission as distinguished from a mobile cellular line, which uses radio waves for

transmission. In 2003, the CIA World Factbook reported approximately 1.263 billion

main telephone lines worldwide. China had more than any other country at 350 million and

the United States was second with 268 million. The United Kingdom had 23.7 million

residential fixed home phones.

6. Fax: - Sometimes called telecopying or telefax (the latter short for telefacsimile), is the

telephonic transmission of scanned printed material (both text and images), normally to a

telephone number connected to a printer or other output device. The original document is

scanned with a fax machine (or a telecopier), which processes the contents (text or images)

as a single fixed graphic image, converting it into a bitmap, and then transmitting it through

the telephone system in the form of audio-frequency tones. The receiving fax machine

interprets the tones and reconstructs the image, printing a paper copy. Early systems used
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direct conversions of image darkness to audio tone in a continuous or analog manner. Since

the 1980s, most machines modulate the transmitted audio frequencies using a digital

representation of the page which is compressed to quickly transmit areas which are all-white

or all-black.

7. Teleprinter: - is an electromechanical device that can be used to send and receive typed

messages through various communications channels, in both point-to-point and point-to-

multipoint configurations. Initially they were used in telegraphy, which developed in the late

1830s and 1840s as the first use of electrical engineering. The machines were adapted to

provide a user interface to early mainframe computers and minicomputers, sending typed

data to the computer and printing the response. Some models could also be used to

create punched tape for data storage (either from typed input or from data received from a

remote source) and to read back such tape for local printing or transmission.

8. Wireless :- communication is the transfer of information or power between two or more

points that are not connected by an electrical conductor. The most common wireless

technologies use radio waves. With radio waves distances can be short, such as a few meters

for Bluetooth or as far as millions of kilometers for deep-space radio communications. It

encompasses various types of fixed, mobile, and portable applications, including two-way

radios, cellular telephones, personal digital assistants (pdas), and wireless networking. Other

examples of applications of radio wireless technology include GPS units, garage door

openers, wireless computer mouse, keyboards and headsets, headphones, radio

receivers, satellite television, broadcast television and cordless telephones.

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ROLE OF GOVERNMENT REGULATIONS AND POLICIES

1. Growth in the reach of telecommunications is one of the key drivers of socio-economic

development. The performance of the Telecommunication sector during 2014-15 has been

encouraging with approximately 30 million new telephone connections added during April to

October, 2014. Overall tele density in the country has increased from 75.23% at the

beginning of the financial year to 77.12% at the end of November, 2014, while total

broadband connections have touched 82.22 million.

2. In order to ensure equity in access and to accelerate the socio-economic growth in the rural

areas, the Government has planned to connect all 2,50,000 Gram Panchayats in the country

with minimum 100 Mbps bandwidth under the National Optical Fiber Network Project

(NOFN). Cable laying has been completed to about 5000 villages and the project is likely to

be completed by 31.12.2016.

3. Basic telephony activity is critical for every part of the country. The Government has

identified approximately 55,691 villages as per 2011 census which do not yet have telecom

connectivity. Based on a comprehensive GIS mapping of these villages, a decision has been

taken to progressively cover all uncovered villages with telecommunication services. In the

first phase, a comprehensive development plan for North-Eastern region at a cost of Rs.5336

crores have been launched which will provide mobile coverage to 8621 uncovered villages,

all national highways in NE and also strengthen the transmission network in these

States. The project will be supplemented through OFC Network augmentation between

Block headquarters and District headquarters in Meghalaya, Manipur, Tripura, Mizoram,

Arunachal Pradesh and Nagaland.

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4. The Government will progressively initiate work to ensure voice connectivity in uncovered

villages in Himalayan States (J&K, Himachal Pradesh) and border States (Rajasthan, Gujarat,

Punjab and Haryana). Focused infrastructure projects are being planned to ensure

connectivity to the Andaman Islands and Lakshadweep through submarine cable and

augmented satellite connectivity.

5. The Government is committed to further the objectives of ‘Make in India’. C-DOT has

developed Next Generation Networks, Wireless Broadband and Network Management

Systems which are supporting domestic telecom players. Appropriate measures will be taken

to create test beds for use of developers of indigenous telecom technology products. Test

beds shall also be created for testing & certification of telecom products so as to ensure apply

quality products meeting the prescribed standards including safety, security and seamless

operation of such products.

ROLE OF TECHNOLOGICAL INNOVATIONS

1 Bharatnet: - For deeper digital penetration in rural areas, the Government has taken up
bharatnet, in mission mode to link each of the 2.5 lakh Gram Panchayats of India through

Broadband optical fiber network. The Optical fiber has reached 90027 Gram Panchayats with

the laying of 202675 km. Of optical fiber cable.

2 Aadhaar Based e-KYC for New Subscribers: - Towards realizing the goal of ‘green
telecom’’, the Government has prescribed an ‘Aadhaar based E-KYC services’ for issuing

mobile connections from September, 2016. Under this, a subscriber can self-authenticate

using his/her biometrics at the point of sale and obtain a new activated sim-card in 30

minutes. In addition to simplifying the process this also ensures security assurance.
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3 Reliance Jio: - is prime example of telecom infrastructure. To transmit trillions GBS of

data at any given point they have state of the art infrastructure in place to cater to the increase

in demand due to low price.

4 Virtual Network Operators (VNO): -The Government has issued guidelines on 31st March
2016 for VNO (Virtual Network Operator) allowing Telecom Service Providers to utilize

their 5 networks and spectrum efficiently by sharing active and passive infrastructure. Till

date 55 licenses have been granted for vnos.

5 Active Infrastructure Sharing: - The Government issued notification on February 11, 2016
permitting sharing of active infrastructure amongst service providers based on mutual

agreements. The active sharing will be limited to antenna, feeder cable, Node B, Radio

Access network (RAN) and transmission systems. This measure would help in provision of

better and speedy services to the consumers while alleviating the cost burden incurred by the

operators for laying telecom infrastructure.

6 All new mobiles to have panic button from 2017: -The Government has mandated that
mobile phones sold in India will come with a dedicated “panic button” that can be used to

send out a signal in case of distress. The Department has notified the Panic button and Global

Positioning System facility in all Mobile Phone Handsets Rules, 2016, in April 2016 aimed at

improving the safety of women and ensuring a quick response from security agencies.

STRATEGIES

A. Marketing Strategies: - The broad majority of consumers and companies use

telecommunications products every day, and that’s why creating marketing strategies that

capitalize on this fact is matter of survival. Consider market penetration of cellphones .

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B. Differentiation Strategies: - It's an approach that a business takes to develop a unique

product or service that customers will find better than or in another way distinctive from

products or services offered by competitors. Differentiation strategy is a way for a business

to distinguish itself from the competition.

C. Pricing strategies: - is a way of finding a competitive price of a product or a service.

This strategy is combined with the other marketing pricing strategies that are the 4P

strategy (products, price, place and promotion) economic patterns, competition, market

demand and finally product characteristic.

FUTURE OF TELECOM INDUSTRY

India is currently the world’s second-largest telecommunications market with a subscriber base

of 1.20 billion and has registered strong growth in the past decade and half. The Indian mobile

economy is growing rapidly and will contribute substantially to India’s Gross Domestic Product

(GDP), according to report prepared by GSM Association (GSMA) in collaboration with the

Boston Consulting Group (BCG). As of January 2019, India has witnessed a 165 per cent growth

in app downloads in the past two years.

With 604.21 million internet subscribers, as of December 2018, India ranks as the world’s

second largest market in terms of total internet users.

Further, India is also the world’s second largest telecommunications market, with total subscriber

base of 1,183.51 million at the end of March 2019.

Due to the ever-growing demand for faster internet, every major telecommunication company is

competing hard among themselves to win the race for dominance over the 5G network which is

probably one of the hottest telecom trends of this year. When it comes to wireless connectivity

over short distances, Wi-Fi is hard to beat. Theoretically, it’s faster than the leading alternative,
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4G LTE, and can handle bandwidth-hogging services like mobile video for a fraction of the cost.

But in practice, today’s Wi-Fi hotspots are notoriously slow and fickle. That’s about to change.

The next generation of Wi-Fi will have the same or better reliability as cellular, hence its carrier-

grade moniker. By 2020, more than 90% of wireless hotspots will be carrier grade, according to

a 2015 Wi-Fi industry survey.

There are new trends being launched on a monthly basis, and the global Telecom industry

overview has been showing great progress. A customer focused attitude can help a company

grow to quiet an extent in the Telecommunication industry today. The Telecom industry trends

in the next decade are going to be taken over by Artificial Intelligence. Machine Learning is

another hot concept that is already trending and that is going to remain among the Telecom

industry trends in 2019.

Do not be limited to offering calling facilities; introduce entertainment options, latest news and

video calling options. Digitally transform your Telecom business and see exemplary growth in

the profits of your business.

NOTABLE TRENDS

a) Green telecom- The Government of India has accepted the TRAI recommendations and

decided to adopt measures to green the telecommunication sector setting broad directions and

goals to achieve the desired reduction in carbon emission through the use of renewable

energy technologies and energy efficient equipment’s. Telecom Industry accounts for a

fraction of the carbon footprint, should not be singled out; Policy should encompass all

sectors for a worthwhile result. Use of Diesel is a compulsion not a choice; Guidelines for

Green Telecom must take into account ground realities. Sub-optimal spectrum allocations

lead to more sites & higher diesel consumption.

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b) Expansion in rural market - Since Idea has two out three customers from rural India, it

expects revenue growth to come from subscriber growth in rural areas but “Idea’s rollout

strategy across the country is based on a calibrated approach to market conditions", said a

company spokesman. Bharti Airtel Ltd has spent a big chunk of its $1.4 billion capex in the

first half of this fiscal on 3G and 4G expansion and Africa operations.

c) Emergence of BWA technologies - The focus of meeting the growing need for broadband

access has shifted onto cover rural and remote areas with relatively lower user density and no

network infrastructure. Broadband Wireless Access (BWA) is now considered a promising

alternative due to the availability of low-cost commodity wireless hardware, newly freed

spectrum and the progress in communication technology. Wireless Optical Broadband

Access Networks (WOBAN) is a popular BWA architecture. It has a wired optical backhaul

network at back end and a wireless mesh network at front end. The wireless part provides

access to end users and the wired part carries the aggregated traffic from the wireless part.

d) Internet of things - The internet of things (IOT) is a computing concept that describes the

idea of everyday physical objects being connected to the internet and being able to identify

themselves to other devices. The term is closely identified with RFID as the method of

communication, although it also may include other sensor technologies, wireless

technologies or QR codes. The IOT is significant because an object that can represent itself

digitally becomes something greater than the object by itself. No longer does the object relate

just to its user, but it is now connected to surrounding objects and database data. When many

objects act in unison, they are known as having "ambient intelligence".

e) Consolidation - Consolidation is a technical analysis term referring to security prices

oscillating within a corridor and is generally interpreted as market indecisiveness. Said

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another way, consolidation is used in technical analysis to describe the movement of a stock's

price within a well-defined pattern of trading levels. Consolidation is generally regarded as a

period of indecision, which ends when the price of the asset moves above or below the prices

in the trading pattern.

f) Rising investment - The Telecommunications industry is divided into following subsectors:

Infrastructure, Equipment, Mobile Virtual Network Operators (MNVO), White Space

Spectrum, 5G, Telephone service providers and Broadband. Telecom tower in India is set to

boom as its tenancy ration will increase from 1.95 times in 2016 to 2.9 times by 2020 due to

the expansion of 3G and 4G and the onset of 5G technologies. More than 60 companies have

received approval from the Department of Telecommunications (dot) in May 2017 to provide

MVNO services; the majority of these companies are focused on Tier 2 and Tier 3 cities.

g) Investment of optical fiber method - An optical fiber is a transparent and flexible fiber

made by drawing glass or plastic, which is used to transmit light. The optical fiber has wide

usages in fiber-optic communications, where they allow transmission over longer distances

and at higher bandwidths than wire cables. The adoption of fiber optic cables to send signals

with less amount of loss has increased over the period, which drives the growth of the

market.

h) Mobile banking- Mobile banking has simplified the lives of many people and given them

the option to send money, receive money, check account balance, pay bills, etc. Using their

mobile phones. And the best part is that banks offer mobile banking services for free. Banks

provide mobile banking services to their clients in the ways listed here:

 Mobile Banking over Wireless Application Protocol (WAP)

 Mobile Banking over SMS (also known as SMS Banking)

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TELECOM COMPANY AND THEIR SERVICES

 Airtel - Airtel is considered the best telecom companies in India with a subscriber base of

than 270 million all over the country. This company founded in 1995 by Sunil Mittal.

 Idea - Idea is another top 10 telecom companies in India with a market share of telecom

companies in India worth around $5 billion in 2017. Established in 1995 by Kumar

Mangalam Birla at Mumbai.

 Vodafone India - Vodafone is one of the best telecom companies in India and is part of the

Vodafone UK group which is the second largest telecom company in the world. This top 10

telecom companies in India was founded in 1994 with a merger between Hutchison and Essar

groups. On 31 August 2018, Vodafone India merged with Idea Cellular, and was renamed as

Vodafone Idea Limited. However, the merged entity continues using both the Idea and

Vodafone brand. Currently, the Vodafone Group holds a 45.1% stake in the combined entity,

the Aditya Birla Group holds 26% and the remaining shares will be held by the public.

 BSNL - This leading telecom brands in the world was established in 2000 at New Delhi,

India and has more than 100 million subscribers across the country. Furthermore, the

revenues of this top mobile network companies in India is worth almost $5,100 million in

2017.

 Jio - it was founded in 2010 by Mukesh Ambani and the head office is located at Navi

Mumbai, India. In India it has around 140 million subscribers and offers one of the lowest

call rates among the top telecom companies in India. More than 10% market share of telecom

companies in India and has an annual revenue of around $800 million.

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INDIAN TELECOM INDUSTRY SERVICES

There are two types of service providers in the Indian Telecom Industry:

A. Basic Service Providers

B. Value added Service Providers

BASIC SERVICE PROVIDERS

Basic service providers are those who provide mainly voice communication. The subscriber’s

connection to the telecom network is called a Direct Exchange Line (DEL) and people use it for

voice communication. Basic services can be differentiated as per call destination into domestic

and international. Domestic calls, both local and long-distance are routed through

cables/r46wireless links. International calls are routed overseas, mainly through satellite links.

The international carriers of various nations liaison with one-another to ensure smooth operations

and efficient call transfer. Major global carriers, mainly private operators from the developed

nations, determine international call tariffs. Revenue sharing agreements exist between various

international carriers.

VALUE ADDED SERVICE PROVIDERS

Value added service providers are those who provide services, such as cellular telephony,

paging, e-mail and VSAT network, which provide the subscriber greater ease of communication

and enhance the utility of basic services network.

In the contemporary world, telecommunications companies market VAS as premium features or

add-ons to their core functions. This is actually the case despite the fact that these services can

function on a stand-alone basis. Typically, these services are not intended to just diversify

product package functionality. They are used to provide administrative and/or operational

synergy among the vast array of services. And, they are beneficial to both service providers and
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customers because they add end user’s functionality while sourcing enhanced analytics and data

for use in businesses.

The following are the various types of services provided by both the service providers put

together:

 Telephone Services

 NSD / ISD Services

 Pay Phones

 National & International Leased Lines Circuits

 Telegraph Services (Manual & Automatic)

 Gateway Packet Switched Data Services (GPSS)

 Gateway Electronic Data Interchange Services (GEDIS)

 Concert Packet Services (CPS)

 Electronic Mail

 Voice Mail

 Audio-Text

 Radio Paging

 Cellular Mobile Telephone

 Video-Tax

 Internet

 ISDN
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GROWTH DRIVERS OF TELECOM INDUSTRY

The telecom industry is rapidly evolving, shaped by changes in technology and light-speed

innovation. It is also an industry continually redefining its parameters, providing

communications service providers (CSPs) with tremendous opportunities for growth. However,

as CSPs expand their partner ecosystem to deliver innovative new services and implement new

business models, new threats arise – both known and unknown. Currently, five main forces are

shaping this future in telecom:

 5G

 NFV/SDN

 Growing Mobile Ecosystem

 Artificial Intelligence and Machine learning

 Value-added Managed Services

I. 5G and NFV/SDN – The first two forces, 5G and the transforming network infrastructures

of NFV/SDN, serve as the base to the promise for faster data speeds and better and wider

connectivity. Network functions virtualization (NFV) capabilities will enable network

slicing, the architecture that will allow multiple service levels and custom-made services to

be offered to vertical industries. Software defined networking (SDN) provides the ability for

CSPs to dynamically collaborate with a wide partner ecosystem. Together, these technologies

will bring greater network efficiency to deliver the high-value, differentiated services

promised by 5G.
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II. Growing Mobile Ecosystem – A growing mobile ecosystem, which includes the rise of the

Internet of Things (IOT), represents a substantial growth opportunity for CSPs. According to

Gartner, the number of connected things in use this year alone is predicted to hit 14.2 billion,

and then grow to 25 billion by 2021. Many of these connected things will be enabled by a

complex web of partners and service providers, opening up new avenues for risk, including

fraud and revenue leakage.

III. Artificial Intelligence and Machine Learning – As technologies evolve, the vast amount of

data we have at our fingertips continues to grow. The exciting aspect around technologies

such as Artificial Intelligence (AI) and Machine Learning (ML) is a greater ability to learn

from this tremendous amount of data and identify patterns and trends to make better

informed decisions with limited human or manual intervention. In today’s digital

environment, there are greater security risks. Service providers utilizing AI and ML will have

a greater ability to predict, identify and mitigate these risks in real-time.

IV. Value-Add Managed Services – Intense competition, demanding customers, evolving

technologies, regulatory hurdles and shrinking margins are putting tremendous pressure on

the telecom industry. To survive these pressures, CSPs are adopting new technologies and

methodologies to improve operations and business processes. To boost business performance

in this disruptive era, many service providers are relying on outsourcing certain services to

experienced partners in order to take advantage of scalable, innovative technology and

expertise that may be too expensive, too difficult to find, and too time-consuming to build in-

house. The result is predictable, effective and agile operations with quick ROI and reduced

exposure to risk. While there is an unprecedented amount of pressure on CSPs and their
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networks, the future for the telecom industry is filled with opportunity to grow business,

increase revenue and provide exceptional service to customers.

TECHNOLOGIES IN TELECOM

1. AR- Augmented reality is the integration of digital information with the user's environment

in real time. Unlike virtual reality, which creates a totally artificial environment, augmented

reality uses the existing environment and overlays new information on top of it.

2. Wireless home internet - it is a type of high-speed internet access where connections to

service providers use radio signals rather than cables, it offers speeds between 1mbps and 10

mbps.

3. 5G/VOLTE – stands for voice over Long term Evolution, recognized as the industry-agreed

progression of voice services across mobile networks, deploying LTE across technology.

4. Analytics- Telecom analytics is a type of technology specifically applied and packaged to

satisfy the complex needs of telecommunication organizations. Telecom analytics is aimed at

decreasing operational costs and maximizing profits by increasing sales, reducing fraud and

improving risk management.

5. IOT - The internet of things, or IOT, is a system of interrelated computing devices,

mechanical and digital machines, objects, animals or people that are provided with unique

identifiers (UIDs) and the ability to transfer data over a network without requiring human-to-

human or human-to-computer interaction.

GOVERNMENT POLICIES

 Bharatnet - The Government is implementing the flagship bharatnet project (in phases),

to link each of the 2.5 lakh Gram Panchayats of India through optical fiber network.
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 Full Mobile Number Portability (MNP) - Government has allowed One Nation Full

Mobile Number Portability (MNP) recently. This has enabled the subscribers to change their

license service area and still retain their mobile number.

 National Digital Communications Policy-The National Digital Communications Policy,

2018 unveiled by the Government seeks to unlock the transformative power of digital

communications networks -to achieve the goal of digital empowerment and improved well-

being of the people of India and attempts to outline a set of goals, initiatives, strategies and

intended policy outcomes.

Departments

 DEPT OF TELECOMMUNICATION - The Department of Telecommunications,

abbreviated to dot, is a department of the Ministry of Communications of the executive

branch of the Government of India. Manoj Sinha is the telecom minister. The Department is

also responsible for frequency management in the field of radio communication in close

coordination with the international bodies. It also enforces wireless regulatory measures by

monitoring wireless transmission of all users in the country.

 TRAI

The Telecom Regulatory Authority of India (TRAI) is a statutory Body set up by the

Government of India under section 3 of the Telecom Regulatory Authority of India Act,

1997. It is the regulator of the telecommunications sector in India. It consists of a

Chairperson and not more than two full-time members and not more than two part-time

members.
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MARKET SIZE

 India has 605 million internet subscribers which makes Indian telecom industry the second

largest in terms of total internet users in the world.

 India has 1184 million telecom users which is the second largest in the world.

 Moreover, India has surpassed USA and became second largest in terms of number of app

downloads.

 Over next 5 years, due to rise in mobile phone penetration and decline in data costs will add

500 million new internet users in India, creating opportunities for business. India has 1165.46

million wireless subscribers and 21.17 million wireline subscribers.

TAX STRUCTURE

 The GST rate for telecommunication and broadcast services has been fixed at 18%.

 Basic customs duties were raised to 20% from 10% on telecom products including base

stations, optical transport equipment, optical transport network products and IP radios.

 A host of telecom products that enjoyed zero duty were slapped with a 10% customs duty.

GLOBAL MARKETS
The telecommunications services industry is one of the fastest growing industries in the

business world. Telecommunications services are offered by telecommunications service

providers for the purpose of sending and receiving messages through electronic de vices.

Services include phone internet access, email, text, television, radio and fax.

Telecommunications services have a robust global market presence, with the mobile

services segment comprising a large chunk. Telecommunications services have proved

very beneficial for businesses as they facilitate effective communication with their

customers and help establish a healthy relationship with them. Telecommunications

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services are also beneficial for the employees as they enable easy transmission of data

and provide efficiency and flexibility. The smartphone, a key application of the rapidly

growing mobile telecommunication, includes an extensive range of applications and

functions. The various types of mobile services are the internet, networking for home,

networking for business, phone, television, etc., of which the phone and internet are the

fastest growing services. Some disadvantages associated with the telecommunications

services market are security issues and equipment expenses among others.

Factors enhancing the growth of telecommunications services are modern and advanced

technology, market competition, investment in new telecommunication technologies like

wireless communication and satellite, innovative services like e-education and e-

agriculture, high-skilled technical manpower, affordability of services, demand for high

speed internet, data processing, etc. However, some factors stymying the

telecommunications services market growth are high cost of value -added services,

maintaining security traits and non-awareness among consumers.

Telecommunication sector is being accountable for designing infrastructure capable of

transferring the data in word, voice and audio to consumers regardless of distance. Infrastructure

which allows this kind of communication contains mostly wireless and digital technology. Major

factors driving market growth for global Telecommunication Industry contains evolution of

innovative services like e-learning, high speed internet availability at reasonable prices and

advancing technology that attracting the youth of the society.

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REVENUES

Global Telecommunication Market was valued US$ 18 Bn in 2017 and is expected to reach US$

29 Bn by 2026, at CAGR of 6.14% during forecast period.

Global revenue from telecommunications services should reach almost 1.2 trillion euro in 2019.

That means constant growth in all areas outside the EU; Asia/Pacific, North America, South

America, Africa and the Middle East. Fixed Telecom services are forecast to amount to around

525 billion U.S. dollars in revenues in 2019.

SPENDINGS

This statistic shows a forecast of global telecom services spending from 2018 to 2023. About

1,625 billion U.S. dollars is forecast to be spent globally in telecom services in 2019.

The telecommunication services industry, which includes fixed-network services and mobile and

wireless services, is a trillion-dollar market projected to grow in the next few years. Global

telecommunication spending is forecast to amount to 1.44 trillion U.S. dollars by 2019. This

projection shows a considerable increase from the 2014 figure, when global spending was

estimated at 1.32 trillion U.S. dollars. The Asia Pacific region is the most valuable

telecommunication services market worldwide. For 2019, the Asia Pacific region is expected to

generate 441.5 billion U.S. dollars in revenues from telecom services. North America and

Europe are also important telecom service markets worldwide.

Wireless telecom services account for the majority of the spending on telecommunication

services. By 2018, wireless telecommunication services are expected to generate around 887.4

billion U.S. dollars in revenues by 2018.

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KEY RISKS AND OPPORTUNITIES

1) Next generation of wireless technology, called 5G - 5G wireless has the potential to

considerably broaden the addressable market for telecom carriers and embed (or cement)

them further into varied digital ecosystems and national economies. Near-term use cases or

applications of 5G, however, might not prove to be the catalysts for solving lack luster

revenue growth in developed markets. Upfront investment in capital and wireless spectrum

for 5G could prove to be substantially higher than prior generations of wireless deployments

due to network density requirements, potentially hurting return of capital metrics. The

potential for meaningful revenue to lag 5G buildouts poses significant credit risks for

providers pursing aggressive deployments.

2) Digital Disruption - Technological advances are changing the way consumers communicate,

resulting in increasing data consumption and streaming video. But intense industry

competition and the commoditization of services can limit the chance to benefit from these

trends. In the wireline industry, traditional landline phone service is being ditched in favor of

wireless. In cable, consumers are increasingly cutting the video cord in favor of over the top

(OTT) online streaming alternatives, a particular threat in the U.S. given the high

contribution of TV into the fixed bundle. Still, cable providers have a natural hedge with

their high-margin broadband product. It is important for them, however, to keep churn low,

which they often do by bundling services to provide additional value. These providers will

benefit from increasing demand for data over the next two to three years, although increasing

competition from 5G fixed wireless in the U.S. could, over the long term, limit cable’s ability

to raise prices. In wireless, more data traffic on the network could necessitate capital

investments to increase capacity at the same time that monetizing demand is complicated by
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intense competition and unlimited data plans. Companies can mitigate the threat of disruptive

technologies, such as OTT, and preserve credit quality with prudent investments that

maximize competitive position (such as fiber and next generation wireless), sustainable

product differentiation, and products and services that earn a strong return.

3) A sharp downturn in the global economy in 2019 - While telecom services show a weak

correlation to macroeconomic factors because they are near necessities, lower discretionary

income could result in a modest acceleration in video subscriber losses (to cheaper online

alternatives), a decline in business revenue for cable, wireline and infrastructure providers,

and modest postpaid wireless subscriber losses (to prepaid). Clearly, the biggest risk is that

tightening credit market conditions could lead to higher borrowing costs and elevated

refinancing risk. This is particularly relevant given the substantial increase in global telecom

debt, which now approximates $1.9 trillion, or almost double the amount in 2012. There is

also about $180 billion in global telecom debt Industry Top Trends 2019:

Telecommunications S&P Global Ratings November 15, 2018 10 coming due over the next

year, much of which will need to be refinanced. We believe the most vulnerable companies

are at the lower-end of the rating spectrum. Globally, there are about 45 credits rated ‘B’ or

lower that could face difficulty accessing capital as debt comes due, or that could face

reduced cash flow from increased interest expense, making it more difficult to ultimately

reduce leverage.

THE WORLD'S TOP 10 TELECOMMUNICATIONS COMPANIES

The world’s top 10 telecommunications companies each have a market value of more than $50

billion. The telecommunications industry is forecast to continue to expand operations on a global

level, servicing the world’s ever-growing telephone and wireless connection needs. More
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individuals in emerging markets are signing up for telephone and Internet contracts, while new

telecommunications technologies in developed nations are expanding providers' pre-existing

customer bases.

While several company attributes can distinguish the Big Ten, market value serves as the

determining factor for this list. The value and performance of these companies will likely change

over time. To invest in any of the following stocks, you would need a broker account from one of

the many online brokers.

I. Verizon Communications

Verizon Communications Inc is one of the largest telecom companies in the world and

among top telecommunication companies in the USA with a market value of around $201

billion in 2018. Verizon is headquartered in Manhattan, New York City and operates in over

150 countries worldwide. Over the recent years, the company has put its main focus on

developing digital & mobile infrastructures and has been investing heavily in next-generation

5G wireless technologies as well as the multitrillion-dollar Internet of Things (IoT)

opportunities.

II. AT&T

AT&T Inc is another American multinational telecommunication conglomerate with market

value of $198 billion in 2018. Headquartered in Dallas, Texas, the company offers a wide

range of products and services, including mobile phone, satellite TV, Home Security, Fixed

Telephone, Digital TV as well as Broadband internet etc. to over 355 million customers

across 56 U.S. metropolitan cities, with plans for further expansion.

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III. China Mobile

China Mobile is a state-owned telecommunication company that provides mobile services

through its nationwide mobile telecommunications network in China. Its mobile phone

network serves over 902 million subscribers as of June 2018, making it the world’s largest

mobile phone operator by total number of subscribers. Headquartered in Beijing, China, it is

also listed in the Hong Kong stock exchange and the NYSE as a public company.

IV. Nippon Telegraph and Telephone

Nippon Telegraph & Telephone (NTT) is one of the top telecom companies in Japan with a

market value of $96 billion in 2018. The company’s revenues are mainly driven by fiber

optic connections and cloud computing services rather than bundle packages. It also owns

NTT DoCoMo – a dominant cellular carrier in Japan, and some phone companies in the

country.

V. Softbank

Softbank Group Corp. is a Japanese multinational holding conglomerate headquartered in

Tokyo, Japan. It owns 80% of Sprint – a leading telecom companies in the USA. SoftBank

also owns operations in broadband; fixed-line telecommunications; e-commerce; internet;

technology services; finance; media and marketing; semiconductor design; and other

businesses. The company has a market value of $85 billion in 2018.

VI. Deutsche Telekom

Deutsche Telekom headquartered in in Bonn, Germany, is the largest telecommunications

services provider in Europe, with a market value of $81 billion in 2018. The company

operates several subsidiaries worldwide, including T-Mobile, and owns major shares in many

other top telecom companies in Europe, such as Magyar Telekom (Hungary), Slovak
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Telekom (Slovakia), Hellenic telecommunication operator OTE. Today, Deutsche Telekom

has over 205 million subscribers for its mobile, broadband other network services.

VII. Vodafone

Vodafone plc is a British multinational telecommunications corporation, with headquarters in

London, the UK. It is one of the largest telecommunications companies in the UK, and also

provides telecommunications and IT services in over 150 countries across the regions of

Asia, Africa, Europe, and Oceania. It’s the world’s second largest mobile network operator,

after China Mobile, with over 535 million mobile subscribers by 2018.

VIII. Telefonica

Telefonica Telecom is a leading Spanish multinational telecom corporation and one of the

largest private telecommunications companies in the world, providing telephone, mobile, TV

network and internet services in Europe, Asia, and North, Central and South America. It also

owns several renewed telecommunications brands including Movistar, O2 and Vivo. With

over $51 billion market value in 2018, Telefonica is also one of the top telecom companies in

the world.

IX. Orange

Orange S.A. is a French multinational telecommunications giant mainly offering telecom

services for mobile, landline, Internet and IPTV. It is also one of the largest 4G and fiber

optic services providers in Europe, where Orange generates over 70% of its revenues every

year. Orange also has strong presence in Middle East and Africa, with over 120 million

subscribers in those regions. In total, it has 256 million customers worldwide.

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X. China Telecom

China Telecom is another state-owned telecommunication company based in Beijing, China.

It is the largest landline service provider and third largest mobile network operator in China.

In total, China Telecom provides fixed-line services to 194 million customers, mobile

services to 215 million customers, and broadband services to 113 million customers across

China, making it one of the largest telecom companies in the world.

COMPANY PROFILES

1) RELIANCE JIO

Reliance Jio Infocomm Limited, Jio, is an Indian telecommunications services company that is

owned by Reliance Industries and is headquartered in Mumbai, Maharashtra, India. Jio operates

a national LTE network with coverage across all 22 telecom circles, however, it does not

offer 2G or 3G service, and instead uses voice over LTE to provide voice service on its network.

Jio soft launched on 27 December 2015 (the eve of what would have been the 83rd birthday of

Reliance Industries founder Dhirubhai Ambani), with a beta for partners and employees, and

became publicly available on 5 September 2016. As of 31 May 2019, it is the largest mobile

network operator in India and the third largest mobile network operator in the world with over

331 million subscribers.

On 5 July 2018, fixed line broadband service named Gigafiber, was launched by the Reliance

Industries Limited's chairman Mukesh Ambani, during the company's Annual General Meeting.

The company was registered in Ambawadi, Ahmedabad (Gujarat) on 15 February 2007 as

Reliance Jio Infocomm Limited. In June 2010, Reliance Industries (RIL) bought a 95% stake in

Infotel Broadband Services Limited (IBSL) for ₹4,800 crore (US$690 million).The company

commercially launched its services on 5 September 2016. Within the first month, Jio announced
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that it had acquired 16 million subscribers. Jio crossed 50 million subscriber mark in 83 days

since its launch, subsequently crossing 100 million subscribers on 22 February 2017. By October

2017 it had about 130 million subscribers.

PRODUCTS AND SERVICES

 Jio Phone

On 21 July 2017, Jio introduced its first "affordable" 4G feature phone, based on KaiOS, named

as Jio Phone. This phone was released for beta users on 15 August 2017 and pre-booking for

regular users started on 24 August 2017.

 Jio Phone 2

A second model with a QWERTY keyboard, as well

as Facebook, WhatsApp and YouTube applications, was released in July 2018.

 4G broadband

The company launched its 4G broadband services throughout India in September 2016. It was

slated to release in December 2015 after some reports said that the company was waiting to

receive final permits from the government. Jio offers fourth-generation (4G) data and voice

services, along with peripheral services like instant messaging and streaming movies and music.

 LYF smartphones

In June 2015, Jio entered into an agreement with domestic handset maker Intex to supply 4G

handsets capable of voice over LTE (VoLTE). However, in October 2015, Jio announced that it

would be launching its own mobile handset brand named LYF.

On 25 January 2016, the company launched its LYF smartphone series starting with Water 1,

through its chain of electronic retail outlets, Reliance Retail. Three more handset models have

been released so far, namely Water 2, Earth 1, and Flame 1.

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 Jio net Wi-Fi

Prior to its pan-India launch of 4G data and telephony services, Jio has started providing free Wi-

Fi hotspot services in cities throughout India including Surat, Ahmedabad in Gujarat,

and Visakhapatnam in Andhra Pradesh, Indore, Jabalpur, Dewas and Ujjain in Madhya Pradesh,

select locations of Mumbai in Maharashtra, Kolkata in West Bengal, Lucknow in Uttar

Pradesh, Bhubaneswar in Odisha, Mussoorie in Uttarakhand, Collectorate's Office

in Meerut, and at MG Road in Vijayawada among others.

In March 2016, Jio started providing free Wi-Fi internet to spectators at six cricket stadiums

hosting the 2016 ICC World Twenty20 matches.

 Jio GigaFiber

Jio started testing Jio GigaFiber on 15 August 2018 which offers high speed broadband, landline

and DTH services.

On August 12, 2019, it was announced that Jio GigaFiber will be available commercially from

September 5.

 Jio apps

In May 2016, Jio launched a bundle of multimedia apps on Google Play as part of its upcoming

4G services. While the apps are available to download for everyone, a user will require a Jio SIM

card to use them. Additionally, most of the apps are in the beta phase. Notable apps include:

 Jio Chat - instant messaging app

 Jio Cinema - online HD video library

 Jio Cloud - cloud-based backup tool

 Jio Mags - e-reader for magazines

 Jio Money Wallet - online payments/wallet app

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 Jio Saavn (earlier, Jio Music) - for online and offline music streaming in English and Indian

languages

 Jio Security - security app

 Jio4G Voice (earlier, Jio Join) - VoLTE phone simulator

 My Jio - manage Jio account and digital services associated with it

 Affordable 4G phones

Reliance Jio has partnered with Google to manufacture "affordable" 4G handsets. These phones

will run exclusively on Jio network. The two companies are also working on developing

software for smart-TV services. Both were expected to launch in 2017.

 Jio Fi

Jio has also launched Wi-Fi routers by the name Jio Fi.

2) VODAFONE IDEA

Vodafone Idea Limited is an Indian telecom operator with its headquarter based in Mumbai,

Maharashtra. Vodafone Idea is a pan-India integrated GSM operator offering 2G, 3G and 4G

VoLTE mobile services under two brands named Vodafone and Idea. Vodafone Idea also

provides services including Mobile payments, IoT, enterprise offerings and entertainment,

accessible via both digital channels as well as on-ground touch points, centers across the

country. As of June 2019, Vodafone Idea has a subscriber base of 320 million, making it the 2nd

largest mobile telecommunications network in India and 4th largest mobile telecommunications

network in the world. Vodafone Idea has a broadband network of 340,000 sites, distribution

reach of 1.7 million retail outlets.

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On 31 August 2018, Vodafone India merged with Idea Cellular, and was renamed as Vodafone

Idea Limited. However, the merged entity continues using both the Idea and Vodafone

brand. Currently, the Vodafone Group holds a 45.1% stake in the combined entity, the Aditya

Birla Group holds 26% and the remaining shares will be held by the public. Kumar Mangalam

Birla heads the merged company as the Chairman and Balesh Sharma used to be the CEO. After

a plunge in share price of Vodafone Idea by 80% on NSE, Balesh Sharma resigned citing

personal reasons. Ravinder Takkar, Ex-CEO of Vodafone Romania and the key deal negotiator

from Vodafone has taken over the reigns as CEO.

About the Merger

On 20 March 2017, Idea and Vodafone India announced that their respective boards had

approved a merger of the two companies. The merger got approval from Department of

Telecommunications in July 2018. On August 30, 2018, National Company Law Tribunal gave

the final nod to the Vodafone-Idea merger. The merger was completed on 31 August 2018, and

the newly merged entity is named Vodafone Idea Ltd. The merger created the largest telecom

company in India by subscribers and by revenue. Under the terms of the deal, the Vodafone

Group holds a 45.2% stake in the combined entity, the Aditya Birla Group holds 26% and the

remaining shares will be held by the public.

Idea previously bought Spice Communications Ltd, operating as Spice Telecom, for over Rs

2,700 crore.

Vodafone India and Idea Cellular decided to have a merger of equals. Vodafone and the Aditya

Birla Group will have a joint control of this combined company. Once you combine the

Vodafone and idea customers, the merged entity could be the biggest telecom company in India.

It would have nearly 40 crore customers, 35% customer market share and 41% revenue market
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share. Months ago, the entry of Reliance Jio in the market disrupted the operations of other

service providers. This merger is a strategic response to Jio’s significant move, as per analysts

quoted in various media reports.

3) BHARTI AIRTEL

Bharti Airtel Limited, known as Airtel, also is an Indian global telecommunications services

company based in Delhi, India. It operates in 18 countries across South Asia and Africa, and also

in the Channel Islands. Airtel provides GSM, 3G, 4G LTE, 4G+ mobile services, fixed line

broadband and voice services depending upon the country of operation. Airtel had also rolled out

its VoLTE technology across all Indian telecom circles. It is the 3rd largest mobile network

operator in India and the 2nd largest mobile network operator in the world with over 293.79

million subscribers.

Airtel is credited with pioneering the business strategy of outsourcing all of its business

operations except marketing, sales and finance and building the 'minutes factory' model of low

cost and high volumes. The strategy has since been adopted by several operators. Airtel's

equipment is provided and maintained by Ericsson, Huawei, and Nokia Networks whereas IT

support is provided by IBM. The transmission towers are maintained by subsidiaries and joint

venture companies of Bharti including Bharti Infra teland Indus Towers in India. Ericsson agreed

for the first time to be paid by the minute for installation and maintenance of their equipment

rather than being paid up front, which allowed Airtel to provide low call rates

of ₹1 (1.4¢ US)/minute.

History

In 1984, Sunil Mittal started assembling push-button phones in India, which he earlier used to

import from a Taiwan company, Kingtel, replacing the old fashioned, bulky rotary phones that
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were in use in the country then. Bharti Telecom Limited (BTL) was incorporated and entered

into a technical tie up with Siemens AG of Germany for manufacture of electronic push button

phones. By the early 1990s, Bharti was making fax machines, cordless phones and another

telecom gear. He named his first push-button phones as 'Mitbrau'.

Mittal clinched a deal with the French telecom group Vivendi. He was one of the first Indian

entrepreneurs to identify the mobile telecom business as a major growth area. His plans were

finally approved by the Government in 1994 and he launched services in Delhi in 1995, when

Bharti Cellular Limited (BCL) was formed to offer cellular services under the brand name

AirTel. Within a few years Bharti became the first telecom company to cross the 2 million

mobile subscriber mark. Bharti also brought down the STD/ISD cellular rates in India under

brand name 'Indiaone'.

In 1999, Bharti Enterprises acquired control of JT Holdings, and extended cellular operations to

Karnataka and Andhra Pradesh. In 2000, Bharti acquired control of Skycell Communications, in

Chennai. In 2001, the company acquired control of Spice Cell in Calcutta. Bharti Enterprises

went public in 2002, and the company was listed on Bombay Stock Exchange and National

Stock Exchange of India. In 2003, the cellular phone operations were re-branded under the single

Airtel brand. In 2004, Bharti acquired control of Hexacom and entered Rajasthan. In 2005,

Bharti extended its network to Andaman and Nicobar. This expansion allowed it to offer voice

services all across India.

Services Offered

Airtel India is the third largest provider after Jio Communications, which recently topped the list

and Vodafone Idea Ltd of mobile telephony and second largest provider of fixed telephony in
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AN OVERVIEW OF THE TELECOM INDUSTRY

India, and is also a provider of broadband and subscription television services. It offers its

telecom services under the airtel brand, and is headed by Sunil Bharti Mittal.

a) Telemedia

Under the Telemedia segment, Airtel provides broadband internet access through DSL, internet

leased lines and MPLS (multiprotocol label switching) solutions, as well as IPTV and fixed line

telephone services. Until 18 September 2004, Bharti provided fixed line telephony and

broadband services under the Touchtel brand. Bharti now provides all telecom services including

fixed line services under the common brand airtel. As of June 2019, Airtel provides Telemedia

services; in 99 cities. As on 30 June 2019, Airtel had 2.342 million broadband subscribers.

b) Digital television

The Digital television business provides Direct-to-Home (DTH) TV services across India under

the brand name Airtel digital TV. It started services on 9 October 2008 and had about

16.027 million customers at the end of June 2019.

c) Mobile data service

Services under mobile data include BlackBerry services; a web-enabled mobile email solution

working on 'push technology'; a USB modem that helps in getting instant access to Internet and

corporate applications; Airtel Data Card, which enables accessing the internet anytime; Easy

Mail, a platform that provides access to personal/corporate e-mails independent of handset

operating system; and application services that shorten the queues at the billing section, off-load

the pressure on the billing staff and bring convenience to the user.

d) Business

Airtel Business consists largely of six products: cloud and managed services, digital signage,

NLD/ILD connectivity (VSAT/ MPLS/ IPLC and Ethernet products), Wi-Fi dongles, voice
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AN OVERVIEW OF THE TELECOM INDUSTRY

solutions (like toll free numbers, TracMate, and automated media reading) and conferencing

solutions (VoIP, audio, video, and web conferencing) serving Industry verticals like BFSI,

IT/ITeS, manufacturing, hospitality and government.

Airtel Business, the B2B arm of Bharti Airtel, has rolled out a first of its kind dedicated digital

platform to serve the growing connectivity, communication and collaboration requirements of

emerging businesses, including SMEs and start-ups. The digital platform will offer solutions to

emerging enterprises to enable ease of business and faster time to market.

e) Android-based tablet

Beetel Teletech Ltd., a unit of Bharti Enterprises Ltd., on 18 August 2011, launched

a ₹9,999 (US$140) 7-inch tablet in India based on Google Inc.'s Android operating system. The

offering is intended to capitalize on the expected demand for cheap computing devices in the

world's fastest-growing and second-largest mobile phone market.

BUSINESS MODELS

MICHAEL PORTER’S FIVE FORCES MODEL

The five forces model is widely accepted as a yardstick for measuring the industry profitability.

It analyzes the various forces influencing the industry’s competitive environment. This is a

macro model concentrating on the external forces like rivalry between firms, bargaining power

of the buyer, bargaining power of the supplier, availability of substitutes and entry barriers. In

order to perform this analysis, the competitive forces in the industry need to be thoroughly

understood, the attractiveness of and growth opportunities within, a new industry need to be

assessed and the effective strategies to raise the profitability, power and competitive position in

an industry need to be developed accordingly.

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AN OVERVIEW OF THE TELECOM INDUSTRY

Porter Five (5) Forces Model was proposed by Michael E. Porter in 1979. The purpose was to

assess and evaluate the competitive positioning and strengths of business organisations. The

model has three horizontal competitive forces (Threat of Substitute Products or services, the

threat of new entrants and rivalry among existing firms) and two vertical forces (Bargaining

power of buyers and bargaining power of suppliers).

These forces shape the competition within any industry. The overall industry competitiveness

declines when these forces reduce profitability. Porter found SWOT analysis lacking in rigour.

Many new companies use the Porter Five (5) Forces Model to decide whether it is profitable to

enter in a particular industry.

Here is the pictorial presentation of the Porter Five (5) Forces Model:
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AN OVERVIEW OF THE TELECOM INDUSTRY

I. Buyer Power: There are several factors leading to increase in the buyer bargaining power in

the telecom industry. As a result of privatization and competition, the buyers are provided a

variety of alternatives to choose from, which was unavailable during the pre-privatization

period. Due to falling prices the switching costs are reduced and the development of IT and

increasing incomes has resulted in change in the standard of living of the consumers.

II. Rivalry between firms: As a result of increasing competition, there are stiff price wars and

innovations have a very short life. The firms operating on economies of scale enjoy a

competitive advantage with respect to their earning sensitivity. Another form of rivalry is the

legal and operational disputes that arise between firms as a way to capture the market. There

are a good number of players who have their corporate image working to their advantage.

III. Supplier Power: The supplier comes in the form of government regulator, which has impact

on the operations of the players. The spectrum sharing and infrastructure issues are governed

by the regulatory body, which is the monopoly supplier to the telecom industry. As regards

the instruments, there are a few suppliers, and the switching cost is very high. The suppliers

follow a uniform pricing structure and it is fixed pricing in the case of government supplier.

IV. Availability of Substitutes: There is availability of close substitutes, since there is no

differentiation in terms of the basic services delivered to the customers. The differentiation

comes in the form of value-added services. Since VAS forms the major differentiator, the

players attract the customers of other service providers; hence there are very low loyalty

levels. Due to increasing market awareness, the customer preferences towards value added

services have also increased.

V. Entry Barriers: The entry barriers are in the form of earning sensitivity issues and

technology investments, which make the industry feasible to operate only for cash-rich
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AN OVERVIEW OF THE TELECOM INDUSTRY

companies. The licensing and operating regulations adopted by the government also form the

entry barriers. The picture of consolidation and capital-intensive nature of the industry are the

other factors that function as entry barriers for the new aspirants to the industry.

The competitive analysis of the Indian telecom industry and the exhaustive insights derived

through the application of PEST templates and Porter’s Five Forces Models, thus throws

light on the external factors that influence the operations of service providers in the Entry

Barriers: The licensing and operating regulations adopted by the government also form the

entry barriers. The picture of consolidation and capital-intensive nature of the industry are the

other factors that function as entry barriers for the new aspirants to the industry.

The competitive analysis of the Indian telecom industry and the exhaustive insights derived

through the application of PEST templates and Porter’s Five Forces Models, thus throws

light on the external factors that influence the operations of service providers in the telecom

sector.

SWOT ANALYSIS

 Strengths

A. Strong demand: World’s second largest in terms of telecom network (a subscriber base of

119.1 crore), internet subscribers (internet users of 51.2 crore) as well as app downloads;

telecom sector likely to have economic value of $217 billion by 2020.

B. Increasing data usage: India is also one of the largest data consumers (an average 1 GB data

per day per user) globally.

C. Good telecom infrastructure: Large telcom have been investing on network infrastructure

to improve customer experience for last few years.

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AN OVERVIEW OF THE TELECOM INDUSTRY

D. Fast-tracked reforms provide room for growth: National digital communications policy,

2018 aims to attract $100 billion worth of investments in the sector by 2022.

 Weakness

A. Intense competition: Cut-throat price war among telcom companies has led to consolidation

in the industry as well as declining overall profits for last couple of years.

B. Debt and finances: Incumbents are currently having unsustainable debt levels owing to

intense competition in the industry.

C. Late adoption of 4G and advanced wireless technologies: Due to regulatory uncertainties

and delayed spectrum auctions, India were late to the 4G. Though world moves towards the

first commercial deployment of 5G in 2019-mid, India to be a late adopter of 5G services.

 Opportunities

A. Mobile Penetration – There is an increasing number of consumers in the world, as more and

more people are getting to know about internet and other stuffs, it is an opportunity for

telecom companies’ industry to grab.

B. New Technologies – The world is moving at a very fast pace so does the telecom industry,

every day there are newer technologies coming up such as optical fiber, 5G, etc. These

technologies prove very beneficial to telecom industry to flourish more.

C. Exploring Adjacent Business in Evolving Environment – As the need for digitalization is

increasing in every sector of the world, the telecom industry has ample of opportunities to

grab, each and every business of the world will be in need of faster and better technologies.

 Threats

A. Ineffective Digital Growth - Industry surveys confirm that digital services are the top

priority for telco leaders. Yet Generating growth from these services remains a challenge. As
 52
AN OVERVIEW OF THE TELECOM INDUSTRY

5G and the IOT move to center stage, telcom companies need to maximize their addressable

market by developing innovative business models, etc.

B. Data Protection - With digital trust now a white-hot issue for consumers and enterprises

alike, and regulators prioritizing data protection, telcom companies face the growing

challenge of ensuring that their customers’ data and experiences are safe and secure.

C. Regulatory Frameworks - Telecoms is also increasingly finding itself at the heart of

governments’ industrial policies, creating new demands on operators. It’s vital for them to

map out, balance and navigate this changing landscape of national and international

regulation and policy.

ANALYSIS OF TELECOM INDUSTRY

 Telecom industry has huge prospects in the future and many companies can penetrate in the

industry.

 The government initiatives are contributing for India to become the largest in terms of

subscribers, internet users and app downloads.

 Latest technologies such as green telecom and 5G are an opportunity for the industry to

boom.

 Telecom industry has also given way to other related and adjacent businesses.
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AN OVERVIEW OF THE TELECOM INDUSTRY

MICRO ANALYSIS
With reference to: - MY JIO LIFE, Dayalbagh, Agra.
 54
AN OVERVIEW OF THE TELECOM INDUSTRY

RELIANCE JIO

• Reliance Jio is an Indian telecommunications services company wholly owned by Reliance

Industries and headquartered in Mumbai, Maharashtra, India.

• It operates a national LTE network with coverage across all 22 telecom circles. It does not

offer 2G or 3G service, and instead uses only voice over LTE to provide voice service on its

4G network.

• Jio soft launched on 27 December 2015 and became publicly available on 5 September 2016.

As of 31 May 2019, it is the largest mobile network operator in India and the third largest

mobile network operator in the world with over 322.99 million subscribers.

• In September 2019, Jio launched a fiber to the home service, offering home broadband,

television, and telephone services.

DATA COLLECTION
METHOD

 Interview

QUESTIONS

 What was the impact of recession?

 How does the competition impact you?

 Do the customers switch over the brands?

 Are there any network problems faced by the customers?

 How are you incentivized by the company?

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AN OVERVIEW OF THE TELECOM INDUSTRY

COMPARISON OF MICRO AND MACRO PORTER FIVE (5)

FORCES MODEL

 SUPPLIER POWER

A. MACRO

 Infrastructure issues

 Monopoly supplier

 High switching cost

The supplier comes in the form of government regulator, which has impact on the operations of

the players. The spectrum sharing and infrastructure issues are governed by the regulatory body,

which is the monopoly supplier to the telecom industry. As regards the instruments, there are a

few suppliers, and the switching cost is very high. The suppliers follow a uniform pricing

structure and it is fixed pricing in the case of government supplier.

B. MICRO

 Less bargaining power

 High capital requirement

 Low switching cost

 Being the suppliers of mobile services such as messaging, calling, data and other value-added

services, the players have less bargaining power with the customers.

 The numbers of reliance jio operates is a lot compared to the buyers. This means that the
suppliers have less control over prices and this make bargaining power of the supplier week

force.
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AN OVERVIEW OF THE TELECOM INDUSTRY

 The product the supplier is provide fairly standardised, less differentiated and have allow

switching costs. This make easier for buyers like reliance Jio switch supplier.

 Capital requirement is high therefore making it difficult for new entrants to set up business as

high expenditures need to be incurred capital expenditure is also high because high research

and development.

 BARGAINING POWER OF BUYERS

A. MACRO-HIGH

Bargaining power of buyers indicates the pressure that customers exert on the business

organizations to get high quality products at affordable prices with excellent customer service.

This force directly influences the Reliance Jio Revolutionizing Indian Telecom’s ability to

accomplish the business objectives. Strong bargaining power lowers profitability and makes the

industry more competitive. Whereas, when buyer power is weak, it makes the industry less

competitive and increase the profitability and growth opportunities for Reliance Jio

Revolutionizing Indian Telecom

There are some factors that increase the bargaining power of buyers:

 A more concentrated customer base increases their bargaining power against Reliance Jio

Revolutionizing Indian Telecom

 Buyer power will also be high if there are few in number whereas a number of sellers

(business organisations) are too many.

 Low switching costs (economic and psychological) also increase the buyers’ bargaining

power.
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AN OVERVIEW OF THE TELECOM INDUSTRY

 In case of corporate customers, their ability to do backward integration strengthen their

position in the market. Backward integration shows the buyers' ability to produce the

products themselves instead of purchasing them from Reliance Jio Revolutionizing Indian

Telecom

 Consumers’ price sensitivity, high market knowledge and purchasing standardised products

in large volumes also increase the buyers' bargaining power.

Some factors that decrease the bargaining power of buyers include lower customer concentration

(means the customer base is geographically dispersed), customers’ inability to integrate

backwards, low price sensitivity, lower market knowledge, high switching costs and purchasing

customised products in small volumes.

B. MICRO-LOW

 Bargaining power of the consumers at the micro level is quite low because of the quality of

services provided by the company, consumer doesn’t want to bargain in exchange of such

quality services.

 Even after having low switching costs, the consumers are not willing to shift to other service

providers because of the quality of the services provided by the company.

 Entertainment, free services like Jio cloud

 Low pricing strategy, word of mouth.

 Sub-par service provided in some specific areas.

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AN OVERVIEW OF THE TELECOM INDUSTRY

 RIVALRY AMONG EXISTING FIRMS

A. MACRO - HIGH

The Rivalry among existing firms shows the number of competitors that give tough competition

to the Reliance Jio Revolutionizing Indian Telecom High rivalry shows Reliance Jio.

Revolutionizing Indian Telecom can face strong pressure from the rival firms, which can limit

each other’s growth potential. Profitability in such industries is low as firms adopt aggressive

targeting and pricing strategies against each other.

The Rivalry among existing firms will be low for Reliance Jio Revolutionizing Indian Telecom

if;

 There are only a limited number of players in the market

 The industry is growing at a fast rate

 There is a clear market leader

 The products are highly differentiated, and each market player targets different sub-

segments.

 The economic/psychological switching costs for consumers are high.

 The exit barriers are low, which means firms can easily leave the industry without incurring

huge losses.

Similarly, there are some factors that increase the Rivalry among existing firms for Reliance Jio

Revolutionizing Indian Telecom. For example, the company will face intense Rivalry among

existing firms if market players are strategically diverse and target the same market. The rivalry
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AN OVERVIEW OF THE TELECOM INDUSTRY

will also be intense if customers are not loyal with existing brands and it is easier to attract

others’ customers due to low switching costs. Competitors with equal size and offering

undifferentiated products with slow industry growth tend to adopt aggressive strategies against

each other. These all factors make the Rivalry among existing firms a major strategic concern for

Reliance Jio Revolutionizing Indian Telecom.

B. MICRO- MODERATE

 Demand push strategies used by companies create competition between the companies since

the retailers can make or break the brand

 Partner stores are the most competitive due to such demand push strategies used by the

companies.

 THREATS OF NEW ENTRANTS

Threats of new entrants reflect how new market players impose threats to the existing market

players. If the industry will be profitable and barriers to enter the industry will be low, it will

attract more players and hence, the threat of new entrants. will be high.

A. MACRO

 Complex regulation

 High price of spectrum

 High initial capital

 Evolving technology

There is very low threat at macro level because

 Reliance Jio Revolutionizing Indian Telecom will face the low threat of new entrants if

existing regulatory framework imposes certain challenges to the new firms interested to enter
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AN OVERVIEW OF THE TELECOM INDUSTRY

in the market. In this case, new players will be required to fulfil strict, time consuming

regulatory requirements, which may discourage some players from entering the market.

 Since telecom technology involve heavy capital investment so chances for new entrants are

very limited.

 There is a complex regulation to enter, high price of spectrum, huge capital investment, well

established players who have a nationwide network, continuously evolving technology, and

second lowest tariff in the world create barriers to enter.

 Govt. policies within the industry requires complex regulation, strict licencing and legal

requirement which is also one barrier.

How Reliance Jio Revolutionizing Indian Telecom can tackle the Threat of

New Entrants?

 Reliance Jio Revolutionizing Indian Telecom can develop brand loyalty by working on

customer relationship management. It will raise psychological switching costs.

 It can develop long-term contractual relationships with distributors to widen access to the

target market.

 Reliance Jio Revolutionizing Indian Telecom can also an investment in research and

development activities, get valuable customer data and introduce innovative

products/services to set strong differentiation basis.

B. MICRO

 Product differentiation

 Costlier production

 Strong emphasis on advertisement

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AN OVERVIEW OF THE TELECOM INDUSTRY

There is very low threat at micro level because they make production costlier for new entrants.

Product differentiation within the industry, where firms in the industry sell differentiated

product. Customer also look for differentiated product. So, this is also one factor for low threat

of new entrants.

There is a strong emphasis on advertisement and customer services as well.

 THREATS OF SUBSTITUTES
The availability of substitute products or services makes the competitive environment

challenging for Reliance Jio Revolutionizing Indian Telecom and other existing players. High

substitute threat shows that customers can use alternative products/services from other industries

to meet their needs.

A. MACRO

 Innovative product

 Homogeneous product

There is a high threat of substitute because nowadays buyers have lot of good option like

vodafone and idea merger, airtel acquisition of tata docomo and telecom can create good chances

for them in future. In perfect competition, firms offer a homogeneous product which is produced

by each competitor.

B. MICRO

 Brand loyalty

 Quality services

 Cheaper product
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AN OVERVIEW OF THE TELECOM INDUSTRY

There is a low threat of substitute because customer cannot derive the same utility from

substitute product as they drive from jio.

There is high brand loyalty because generally customer cannot switch the brand due to good

services which they are getting, so there is low threat of substitute.

They provide cheaper substitute product and services as compare to another industry.

The switching cost of using the substitute product is high (due to high psychological costs or

higher economic costs)

How Reliance Jio Revolutionizing Indian Telecom can tackle the Threat of

Substitute Products or services?

 Reliance Jio Revolutionizing Indian Telecom can reduce the Threat of Substitute Products or

services by clearly emphasizing how its offered product/service is better than the available

substitutes.

 It should provide convincing reasons to the customers by offering a better experience and

high value for money.

 It can raise switching costs by working on loyalty.

 Lastly, it can improve the quality, maximise value for money and set strong differentiation

basis to discourage customers from using the substitute product.

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AN OVERVIEW OF THE TELECOM INDUSTRY

COMPARISON OF MICRO AND MACRO SWOT ANALYSIS

STRENGTHS
A. MACRO

 Strong demand - World’s second largest in terms of telecom network (a subscriber base of

119.1 crore), internet subscribers (internet users of 51.2 crore) as well as app downloads;

telecom sector likely to have economic value of $217 billion by 2020.

 Increasing data usage - India is also one of the largest data consumers (an average 1 GB

data per day per user) globally.

 Good telecom infrastructure - Large telecom companies have been investing on network

infrastructure to improve customer experience for last few years.

 Government reforms - National digital communications policy, 2018 aims to attract $100

billion worth of investments in the sector by 2022.

B. MICRO

 Strong customer base – Jio was successfully able to acquire 100 million subscribers in the

first 170 days of its launch which broke the records and made it India’s largest internet

service provider. As we can see today that most of the smartphones are available with two

sim slots, in 90% cases, we see that one of those two sims are Jio.

 Location – The My Jio Store visited by us was located at New Agra, Bhagwan Talkies

which is an attractive location for customers and as an advantage for them.

 Brand management – Jio has been so successful just because of its brand management

strategies. The right promotions backed by lucrative offers and credible brand ambassadors

like Shah Rukh Khan and Amitabh Bachchan have helped in building connectivity with

customers.
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AN OVERVIEW OF THE TELECOM INDUSTRY

 Multiple offerings – Jio offers a variety of services like movies, games, shopping, etc giving

customers lot of options to choose from.

 WEAKNESSES

A. MACRO

 Intense Competition - Cut-throat price war among telcom companies has led to

consolidation in the industry as well as declining overall profits for last couple of years.

 Debt - Incumbents are currently having unsustainable debt levels owing to intense

competition in the industry.

 Late adoption of 4G - Due to regulatory uncertainties and delayed spectrum auction, India

were late to the 4G. Though world moves towards the first commercial deployment of 5G in

2019-mid, India to be a a late adopter of 5G services.

B. MICRO

 Requirement of 4G handset – It is not possible to operate Jio sims in 2G or 3G phones. It

requires a 4G handset which is a costly smartphone. It is difficult for poors to afford the

smartphones. On the contrary, Reliance has countered this weakness by launching a 4G

handset just for Rs. 1500 and it provides Whatsapp and high quality movies.

 Late entry into the market – Jio has entered in the telecom industry which already has

established players like Vodafone and Airtel who had already occupied in the minds of

customers.

 Data connection – The connections are many times poor from Jio and the range is less
causing slower loading speeds in selected regions.
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AN OVERVIEW OF THE TELECOM INDUSTRY

 OPPORTUNITIES

A. MACRO

 Mobile Penetration – There is an increasing number of consumers in the world, as more and

more people are getting to know about internet and other stuffs, it is an opportunity for

telecom companies’ industry to grab.

 New Technologies – The world is moving at a very fast pace so does the telecom industry,

every day there are newer technologies coming up such as optical fiber, 5G, etc. These

technologies prove very beneficial to telecom industry to flourish more.

 Exploring Adjacent Business in Evolving Environment – As the need for digitalization is

increasing in every sector of the world, the telecom industry has ample of opportunities to

grab, each and every business of the world will be in need of faster and better technologies.

B. MICRO

 Gigafibre Technology – As Jio has just launched gigafiber, it is a huge opportunity for each

Jio retailer to grab some profit. The My Jio Store in Dayalbagh is also helpful as they are

getting 5/6 new registrations everyday for gigafiber. They are seeing this an opportunity.

 Less Competition – Another factor is that the there is very less competition for that My Jio

Store, we went to. There are no such retailers in that area, it is an opportunity for him to grab

more customers.

 Jio Phones – Another opportunity is Jio Phones. As Jio 4G sims doesn’t work in 2G or 3G

phones & so people having these phones can’t get the sim, so the Jio phones is an

opportunity for the company to earn more, as people will purchase it to get a Jio sim. As

stated by My Jio Store owner that almost 90% of dual sim phones have a Jio sim in one of

the slots and if they don’t have one, they want to buy it.
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AN OVERVIEW OF THE TELECOM INDUSTRY

 THREATS

A. MACRO

D. Ineffective Digital Growth - Industry surveys confirm that digital services are the top

priority for telco leaders. Yet Generating growth from these services remains a challenge. As

5G and the IOT move to centre stage, telcom companies need to maximize their addressable

market by developing innovative business models, etc.

E. Data Protection - With digital trust now a white-hot issue for consumers and enterprises

alike, and regulators prioritizing data protection, telcom companies face the growing

challenge of ensuring that their customers’ data and experiences are safe and secure.

F. Regulatory Frameworks - Telecoms is also increasingly finding itself at the heart of

governments’ industrial policies, creating new demands on operators. It’s vital for them to

map out, balance and navigate this changing landscape of national and international

regulation and policy.

B. MICRO

 Risks of loss of customers – Customers prefer Jio primarily because of the low prices that

they offer. At a stage when the company increases its price there may be a loss of customers.

 Removal of free services – Jio currently is associated with a lot of freebies. Once these are

removed there may be a drop-in sale for the company.

 Decreased internet speed - With addition of users to the Jio network, the speed of Jio's 4G

data services has come down drastically after September 5. Now, the internet speed has come

down to 6-10 Mbps from 50Mbps during the launch stage.

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AN OVERVIEW OF THE TELECOM INDUSTRY

BIBLIOGRAPHY

o https://www.investopedia.com/ask/answers/070815/what-telecommunications-

sector.asp#telecommunications-sector-outlook

o https://www.investindia.gov.in/sector/telecom

o https://www.marketresearchreports.com/telecom

o https://www.ibef.org/industry/telecommunications.aspx

o https://www.equitymaster.com/research-it/sector-info/telecom/Telecom-Sector-Analysis-

Report.asp

o https://en.m.wikipedia.org/wiki/Jio

o https://www.businesstoday.in/current/economy-politics/reliance-jio-becomes-largest-

telecom-operator-india-within-3-years-starting-business/story/368241.html

o https://simconblog.wordpress.com/2016/06/18/telecommunications-industry-analysis/

o https://en.m.wikipedia.org/wiki/Vodafone_Idea_Limited

o https://en.m.wikipedia.org/wiki/Bharti_Airtel

o https://mse238blog.stanford.edu/2017/07/ssound/1g-2g-5g-the-evolution-of-the-gs/

o https://blog.wedotechnologies.com/five-forces-driving-the-telecom-industry

o Industry Top Trends 2019: Telecommunications(report)

o The top 10 risks in telecommunications 2019(report)

o Technology, Media, and Telecommunications by Deloitte(report)

o The Indian Telecom Industry: Status Analysis (Report)