TELECOM INDUSTRY
' Indian Telecom Industry' is the third largest and fastest growing in the world with nearly 200 million connections. Subscriber growth rate is 45% The wireless technologies currently in use ' Indian Telecom Industry ' Global System for Mobile Communications (GSM) Code Division Multiple Access (CDMA). There are primarily 11 GSM and 4 CDMA operators providing mobile services in 19 telecommunication circles and 4 metro cities, covering more than 2000 towns across the country.
Telecom Industry in India ' is regulated by 'Telecom Regulatory Authority of India' (TRAI). Three types of players exist in ' Indian Telecom Industry ' : State owned companies like - BSNL and MTNL. Private Indian owned companies like - Reliance Infocomm and Tata Teleservices. Foreign invested companies like – HutchisonEssar , Bharti Tele-Ventures, Escotel, Idea Cellular, BPL Mobile, Spice Communications etc.
MARKET SHARE
BHARTI ENTERPRISES BHARTI ENTERPRISES
Bharati Telecom Bharti Teletech Seychelles Telecom Ltd. Ltd. Ltd.
eletech Services (India) Ltd.
Field Jersey Bharti AXA Bharti Bharti Airtel Insurance Telesoft Fresh Retail Pvt Ltd. Co. Ltd Ltd. Foods Pvt. Ltd. Ltd.
Bharti Airtel Ltd
BHARTI AIRTEL LIMITED
Established in June 07, 1995 as a Public Limited Company. Largest Cellular Operator in India. Listed on Bombay Stock Exchange (BSE) & National Stock Exchange of India Limited (NSE) Operational Network: Provides GSM mobile services in all the 23 telecom circles in India, and was the first private operator to have an all India presence. Provides broadband (DSL) and telephone services (fixed line) in 94 cities in India
STRATEGIC BUSINESS UNIT Mobile Services:
This unit constitutes the largest portion of the company’s business in terms of total revenues and customers. The company’s mobile customer base accounts for 22.9% of the overall wireless (GSM+CDMA) market. Broadband and Telephone Services This unit provides fixed line and broadband services over the same copper lines. Plans to introduce IPTV (Internet Protocol Television) Enterprise Services : Two sub-units are – Carriers : It handles long distance national & international mobile, broadband and telephone services. Corporates: It provides customised integrated voice and data communications solutions to corporate customers.
PERFORMANCE AT A GLANCE Particulars
Units
Full Year Ended March 31 2003
2004
2005
2006
2007
Total Customer Base
(In 1000)
3,443
7,141
11,842
20,926
39,013
Mobile Services
(In 1000)
3,071
6,504
10,984
19,579
37,141
Broadband and Telephone Services (In 1000)
372
637
857
1,347
1,871
Revenue
Rs. Mn
30,554
50,369
81,558
116,641
184,202
Profit After Tax
Rs. Mn
(2,051)
5,837
12,116
20,279
40,621
Return on Capital employed
%
0.9
9.9
15.7
21.5
31.6
ANSOFF’S MODEL MARKET PENETRATION STRATEGY (Increase Market Share)
Attract users of competitors products : Full Talktime Convert nonusers into users :Lifetime plans to attract low income groups Increase product usage : Easy Recharges Increase the frequency of purchase : Recharge through ATM ; Internet based recharging through leading banks ; Products available on Indiatimes shopping and Rediff shopping Find new applications for current users : Collaboration with banks to facilitate fund transfer through mobile; Global Money Transfer.
NEW PRODUCT DEVELOPMENT
Product quality improvement strategy : Good mobile coverage.
Product feature additions strategy : Wap Services ; EDGE Service; Airtel Live ( Cricket news, downloads, astrology, travel etc.) ;
New product development strategy : Blackberry
MARKET DEVELOPMENT (Intensive)
Expand geographically : Entering new markets in the west (U.K) ; Launching mobile services in Sri Lanka ; GSM license in Bhutan
Target new segments : CallHome service for NRIs living in USA to be in touch with their loved ones.
DIVERSIFICATION
Broadband Services. Telephone Services - Touchtel. Consultancy services to industry verticals like Banking, Financial services and Insurance, ITES, etc. to meet their telecom needs.
FOUR Ps
FIVE PRODUCT LEVELS Core Product: Communication; Basic Product: Mobile telephony Expected Product: Strong network coverage Augmented Product: Caller tunes, Wallpaper, Ring tones, WAP, SMS alerts, Voice SMS Potential Product:
PRODUCT Product Variety:
Prepaid Postpaid Value added services Blackberry Business solutions
PRICE
Easy payment options. Anytime Anywhere Easy billing Flexible Credit limit Happy recharge ( full talktime everytime)
PLACE
Operating in 23 circles in India Strong distribution network with approximately 160,000 family of retailers Over 500 exclusive outlets Operation in foreign countries
PROMOTION
Celebrity endorsements ( Sachin Tendulkar, Amitabh Bachhan, Shahrukh Khan, AR Rehman, Madhavan,Kareena Kapoor) Loyalty rewards Lower tariffs Discount coupons Talk time schemes Special season offers Innovative advertisement campaigns Mass promotion campaigns Setting up of exclusive stalls to promote existing and new products. Corporate Social Responsibility: “Satya Bharti School” providing primary education for underprivileged children in rural areas.
SEGMENTATION
Geographic Segmentation : 23 telecom circles (different tariff for different circles) Demographic Segmentation :
Age : Senior citizen. Gender : Women. Occupation : Students ( Youth Plan) , Corporate . Income: All income groups ( Different plans for various income groups)
POSITIONING AirTel positions itself in the market as a very
reliable, effective and consumer savvy brand Positioning as a brand which people can trust in terms of quality and performances Plans to position itself as complete telecom service provider with a strong presence in global network
FIVE FORCE ANALYSIS Potential entrants -Entry
of Global Telecom providers
Suppliers (supplier power) Ericsson – GSM Network Management Service Provider
Industry Competitors
Hutch, BSNL, Idea, MTNL, Tata Indicom, Reliance
Substitutes CDMA technology, Internet messengers, Netto-Phone
Buyers Loyalty shift.
COMPETITOR – HUTCH
Hutch is the second largest cellular operator in India in terms of revenue. Operates in 16 telecom circles. Subscriber base : 26.73 Million. Market share : 20% of the GSM market. Highest average revenue per user in industry. Vodafone has acquired a 67% of holding in Hutch-Essar for US$11.1 billion
SERVICE PORTFOLIO
Prepaid Postpaid Calling Cards HandyPhone Hutch PCO Hutch World (GPRS service) Hutch services on mobile
PlanetHutch services Mobile E-mail solutions
00000 00000 00000 00000 00000 00000 0000 0000 0000 0000 0
17888
Revenue (( in in Crore) Crore) Revenue
Revenue ( in Crore)
AIRTEL vs HUTCH (Revenue Comparison) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 00000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
11291
10565
6837
FY --00 FY -- 0000 0000 00
FY - 0000 -00
FY --00 FY 0000 0000 00 Year Year
FY 0000 -00
Airtel Hutch Airtel Year Hutch
Airtel
Hutch
RECOMMENDATIONS
Airtel should consider acquisition of domestic and local GSM service providers, thereby increasing its market share. E.g. , acquisition of Spice. It has to be quick to adapt to and bring new emerging technologies like 3G and 4G in India at affordable cost. It should start Mobile Bill Payment Van services. It should put more focus on entering into new countries and establishing itself as a global brand. It should expand its rural network coverage to widen its customer base.
THANK YOU