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Telecom Service Provider (india)

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An Industry where companies are “primarily engaged in operating, maintaining, and/or providing access to facilities for the transmission of voice, data, text, sound, and video” is known as Telecommunications Industry. Hence, Telecom Service Providers are organizations which provide the aforementioned services through the land-line and wireless networks. (

Goldman Sachs research says, “India will overtake US by 2050” and the reasons for these predictions are India’s increased openness to trade, investment in information and communication technology, and greater financial deepening.


These structural changes have had a positive impact on the telecommunications sector so far. The Indian is the fifth largest telecom market in the world meeting up with global standards, ( but it still remains one of the lowest penetrated markets, and given the string of fovourable and sustainable economic growth, India remains one of the most attractive telecom markets in the world. (

The gross telephony subscribers : 183.53 million (November 2006)

Teledensity : 16.60% (November 2006)


1. Key Players:

There are three types of players in telecom services:

• State owned companies (BSNL and MTNL)

• Private Indian owned companies (Reliance Infocomm, Tata Teleservices,)

• Foreign invested companies (Hutchison-Essar, Bharti Tele-Ventures, Escotel, Idea Cellular, BPL Mobile, Spice Communications)

2. Division: The Indian Telecom Industry can be divided into two main categories on the

basis of technology:

i) Fixed Line-

Total subscriber base of fixed (Wireline) lines stood at 40.48 million (September, 2006).

The Wireline segment is dominated by the incumbents BSNL and MTNL both having 84% and 9% market share respectively in the subscriber base, while other private operators together have 7% share only.

ii) Wireless-

“The Wireless (Mobile and WLL (F)) Market has reached 129.54 million as on 30th September 2006 against 112.14 million subscribers in the previous quarter. During this quarter 17.4 million subscribers were added, thus recording a growth of 15.52%.

5. Key Drivers for Change:

a) Rising Subscriber Base:

The factors like falling handset costs, increased disposable income of individuals, attractive tariffs offered by different service providers, value added services and deeper penetration level has created a huge demand for the telecom services and has helped in sustained momentum in growth of subscriber additions (more than 6 million per month). (

b) Deregulation:

The potential for improvement through deregulation was shown by reforms in the telecom industry, where relaxation of rules resulted in India emerging as the fifth largest market in telecom services with more than 120 million mobile telephone users.


c) Technology:

The advancement in technology has resulted in reduction in cost per line, leading to higher line addition, better and faster services for the same investment. ( In future, the telecom value chain will be a convergence of information, telecommunications and entertainment and pacing up the usage of 3G mobile services.

( )

d) Competition:

After liberalization, the entry of private players and joint ventures with strong foreign players has resulted in stronger growth with increased investment and latest technology implementation. Foreign Direct Investment of about 74% has led to increase in the

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