economic ppt section a group 7.pptx

8/11/2019 ECONOMIC PPT SECTION A GROUP 7.pptx

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SECTION A

GROUP

PIYUSH S SHINGVI

MANAV MASSAND

PRIYA SHIKHA IGGA

NITESH SAHA

PRASANNA SUBBA

HITESH SINGHAL


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1850

Experimental electric telegraph line

started

1851Accessible to British East Company

1854First civil line introduced for Britishviceroy Dr. William and team


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1882

Establishment of First Formal

Telephone Exchange in Calcutta

1883

Merger of telephone service

with postal system

1902

Introduction of cable and

wireless telegraph


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1914

Installation of Automatic

Exchange

1927

Commencement of Radio

Broadcasting

1947

Formation of Posts, Telephone &

Telegraph (PTT) under ministry ofcommunication


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1959

Television programming

1960

Subscriber Trunk Dialing

commissioned

1997 Establishment of TRAI


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1980

Establishment of Earth

Satellite Station at U.P

1984

Setting up an autonomous

body C-DOT by the govt.

1995

Mobile Telephone Service in

Delhi


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1980s,the root cause of the crisis was the large and growing fiscalimbalance.

Large fiscal deficits emerged as a result of mounting governmentexpenditures, particularly during the second half of the 80s.

These fiscal deficits led to high levels of borrowing by the governmentfrom the reserve bank of India(RBI), IMF, World Bank.

Government expenditure in India grew at a phenomenal rate , faster thanwhat government earns as a revenues.

The Subsidies grew at a rate faster than government expenditures.

Expenditure on subsidies rose from Rs. 19.1 billion in 1980-81 to Rs.107.2 billion in 1990-91.


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The Indian economy was indeed in deep trouble.

Lack of foreign reserves.

Gold reserve was empty.

Before 1991, India was a closed economy.

The government was close to default and its foreign exchange reserveshad reduced to the point that India could barely finance three weeksworth of imports.

The government of India headed by Chandra Shekhar, with Manmohan

Singh (appointed as a special economical advisor)decided to usher inseveral reforms that are collectively termed as liberalization in the Indianmedia.


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Industrial delicensing and simplification andrationalization of tax structure to promoteinvestment and expansion.

Liberal FDI regime to supplement domestic resources.

Current account convertibility to have a liberal traderegime.

Public sector disinvestment to ensure government

does what it does best.

WTO compatibility to plug into the globaleconomy.


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Industrial policy has seen the greatest change, with most centralgovernment industrial controls being dismantled. The list ofindustries reserved solely for the public sector --which usedto cover 18 industries, including iron and steel, heavy plant andmachinery, telecommunications and telecom equipment,minerals, oil, mining, air transport services and

electricity generation and distribution --has been drasticallyreduced to three: defense aircrafts and warships, atomic energygeneration, and railway transport . Industrial licensing by thecentral government has been almost abolished except for a fewhazardous and environmentally sensitive industries.

The requirement that investments by large industrial housesneeded a separate clearance under the Monopolies andRestrictive Trade Practices Act to discourage the concentrationof economic power was abolished and the act itself is tobe replaced by a new competition law which will attempt toregulate anticompetitive behavior in other ways.


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The Monopolistic and Restrictive Trade Practices Act,1969, aims to prevent concentration of economicpower to the common detriment, provide for controlof monopolies and probation of monopolistic,restrictive and unfair trade practice and protectconsumer interest.

License Raj refers to the elaborate licenses,regulations and accompanying red tape that wererequired to set up business in India between 1947and 1990. the license Raj was a result of Indias

decision to have a planned economy, where allaspects of the economy are controlled by the stateand licenses were given to a select few.


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After reforms in 1992, huge amounts of foreign directinvestment came into India

In 1993, foreign institutional investors were allowedto purchases hares of listed Indian companies in the stock

market.

Foreign direct investments in India are approved through tworoutes:

a) Automatic approval by RBI

b) The FIPB Route


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The specific targets that New Telecom Policy 1999 sought to achieve were:-

Make available telephone on demand by the year 2002 and sustain it thereafter so asto achieve a tele density of 7 by the year 2005 and 15 by the year 2010.

Encourage development of telecom in rural areas making it more affordable by suitabletariff structure and making rural communication mandatory for all fixed service

providers.

Increase rural tele density from the current level of 0.4 to 4 by the year 2010 andprovide reliable transmission media in all rural areas.

Achieve telecom coverage of all villages in the country and provide reliable media to allexchanges by the year 2002.

Provide Internet access to all district head quarters by the year 2000.

Provide high speed data and multimedia capability using technologies including ISDN toall towns with a population greater than 2 lakh by the year 2002.


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India introduced private competition in value-added services in 1992 followed by opening up of

cellular and basic services for local area to private competition.

The Telecom Regulatory Authority of India (TRAI) was constituted in1997 as an independent regulator

in this sector.

Competition was also introduced in national long distance (NLD) and international long distance (ILD)

telephony at the start of the current decade.

FDI in telecom sector which opened up with 49 , has been increased to74 equity cap in 2004-05

Budget.

As many as 72 million new phones have been added since 2007-2008.


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Increased to 29.9%from 29.2% in the quarterended March 2013

20 countries across southAsia, Africa and the Channelof Islands

2G, 3G and 4G services

third mobiletelecommunicationscompany in the world

261 million subscribers outof which 200 million are inIndia

Airtel collaborated withRIM and launched itsBlackberry services inOctober 2004

According to the annual

survey conducted by brandFinance, it is the sixth mostvaluable brand.

Increased to 15.7% from

15% in the quarter endedMarch 2013

Vodafone Essar andHutchinson Essar

Vodafone paid $5.46 billion totake 33% stake in the Indiansubsidiary

It left Vodafone with 74% of

the Indian business, while theother 26% is owned by Indianinvestors & valued to be $18.8billion in 2007.

launched 3G services in thecountry in the January-Marchquarter of 2011 and has plansto spend up to $500 millionwithin the next two years on

its 3G networks

Increased to 23%from 22.7% in the quarter

ended March 2013 Previously ran by Tata

Cellular, it was bought byBirla-AT&T in 2000

Currently, Birlas hold 49.05% shares in Idea and theremaining is held by AxiataGroup and Providence

equity.


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28.45%

23.10%

18.62%

14.48%

9.08%

4.810.36 %

0.65 %

0.45%

Airtel

Vodafone

IDEA

BSNL

Aircel

Uninor

Videocon

MTNL

Loop

Group Company wise market share as of June 2013


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Group Company wise market share (Subscribers) - June 2013

Sl. No. Name of Company Total Sub FiguresAdditions in June

2013Market Share

Growth over

previous month

1 Bharti Airtel 190,912,421 1,263,099 28.45% 0.67%

2 Vodafone 155,033,868 347,025 23.10% 0.22%

3 IDEA 124,968,107 1,209,395 18.62% 0.98%

4 BSNL 97,172,146 0 14.48% 0.0%

5 Aircel 60,969,974 611,958 9.08% 1.01%

6 Uninor 32,295,872 295,941 4.81% 0.92%

7 Videocon 2,417,993 132,816 0.36% 5.81%

8 MTNL 4,335,046 -287,878 0.65% -6.23%

9 Loop Mobile 3,028,539 0 0.45% 0.00%

All India 671,133,966 3,572,356 100.00


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To forge a link between supply and demand.

To generate revenues and cover costs of

providing service.

To convey information to customersconcerning the service.

To provide a platform for competition.


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Demand-based pricingPricing according to what the customer is able to payMay be required by politicians (monopoly environment).

Cost-based pricingPricing according to what the service costs to supplyMay be required by regulators (regulated environment).

Market-based pricing

Pricing in order to compete with other suppliers in theMarketplace.May be required by shareholders (competitive market).


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To ensure that the benefits of competition andtechnological change are shared by all users.

To protect the interests of specific user groups(e.g., low volume users, rural areas).

To ensure that incumbent operator does notabuse its dominant position.

To regulate specific servicesInterconnect price for competitive operators.Leased line charges for Internet Services.


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Phase Outgoing Incoming INITIATOR

Introduction(1995-2000)

Rs. 14/min----Rs. 9/min

Rs. 14/min----Re. 1/min

Airtel

Growth (2000-2005)

Rs 2/min Free AirtelSoon follwed byHutchissonessar

(2005-Present) 1 paisa/sec Free Tata Docomo


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Tata Indicom provides 10 minutes local for justRe.1.

Reliance Communication provides all STD calls atrs.0.50 per minute.

Vodafone provides various schemes to theircustomers.

Idea provides Gang Plan to their customers.

Airtel provides special number facility.


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Customers get benefits.

Reduction in revenue of serviceprovider.

Best service available in lowrate for customers.

High competition in market.


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MNP or mobile number portability, allows you totransfer your existing mobile phone number fromone mobile phone network provider to anothermobile phone provider so that if you changemobile phone networks you do not have to giveeveryone a new number... You can keep your

existing mobile phone number. The process istermed MNP or mobile number portability. It'squick and very easy to do - follow theinstructions above for full details on how to portyour mobile phone number to a new network

provider.

MNP (mobile number portability) will incur acharge (Rs 19).


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MNP was launched in January 2011 in India, and has been used by only 45.86

million users so far.


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250

N b f S b ib f J 2013 (i Milli )


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190.91

155.03

124.97

97.17

60.97

32.30

2.42 4.34 3.03

0

50

100

150

200

Airtel

Vodafone

IDEA

BSNL

Aircel

Uninor

Videocon

MTNL

Loop

Number of Subscribers as of June 2013 (in Millions)

Operator Wise % Growth over previous Month


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0.67%0.22%

0.98%

0.0%

1.01%

0.92%

5.81%

-6.23%

0.00%

Airtel

Vodafone

IDE

A

BSN

L

Aircel

Uninor

Vid

eocon

MT

NL

Loo

p

p p


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Revenue growth New operators keep entering the market with very low prices, which

results in unnecessary tariff wars and slows revenue growth

Subscriber growth

Number of operators

Rural penetration

Security clearance for procurement of telecom equipment

Review of spectrum management and licence terms andconditions


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Economy fluctuations

Government PoliciesNational Telecom Policy (NTP), 2012Reduce Carbon Emission Reduction up to 5% by 2012-2013

100% FDI Policy.

Challenges Faced By The Players:


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Traditionally, the operators have had an upper hand in therelationship with the handset vendors especially in the westernmarkets as the operators distribute the handsets themselves andprovide subsidy.

Operators used to procure and sell the handsets and provided thevoice & data services to the subscribers. This meant that the handset

vendors did not have any regular contact with the subscriber.However, now the handset are moving very fast to exploit one oftheir few unique strengths which is service distribution anddiscovery on-device and therefore monetise from retailing andmanaging services at point-of-purchase and during in-life use.


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1. Direct Handset Sales: Last year, Google tried to sell Nexus Oneonline in a bid to directly sell it to the end user instead of the

carriers

2. Embedded Software SIM -There are reports of Apple workingon embedded software SIM that would allow the users to buy the

phone on the web and then select the carrier of their choice.

3. Ecosystem warsLeading operators across the global have

announced partnership to launch their own application developmenteffort under the name of Wholesale Application Community

(WAC).


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4. Duopoly fearsCarriers fear that Google and Apple would controlmost of the parts of the ecosystem and hence are keen that the vendorsdo not select Android as an operating system.The carriers fear that incase the operating systems get reduced to two, they would lose the

bargaining power and could soon find themselves in the same situationas service providers for fixed line internet.

5. Near Field Communications- Near Field Communications (NFC) isa technology that has the potential to make the mobile payments easier

by just tapping the phone at the Point of Sale (POS). Though thetechnology has been in existence for many years now, the recent push

by Google and Apple seems to have changed the equation. Google and

Apple want to drive billing through a device to challenge the operatorbilling alternative and this move would bring them right in the center ofthe mobile payments.


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Mobile Money & Machine to Machine:-These fundamentally changethe perception of what communication means. While mobile money

introduces communication transactions worth hundreds or eventhousands of Euros, machine-to-machine introduces machines, in eitherends of the communication line.Both mobile money and machine-to-machine are industry forces thatare growing at very high rates: more than 160 live mobile money

projects and 100 planned deployments1; different analysts forecast 10

to 50 billion of connected devices by 2020, up from 1 billion in 2010.

Cloud Offerings:-The cloud not only paves the way forcommunication providers to expand their businesses as cloud servicesenablers or providers, but it also fosters efficiency, as communications

providers benefit from outsourcing part of their non-core operations to

external providers over the cloud.


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OTT Players:-OTT players such as social networks or VOIP players are the fourth

force. And what a force! As the industry redefines itself and expands, these newplayers are riding the digital wave of the all-connected, anytime anywhere, and

creating valuable ecosystems on top of the communication networks and

infrastructure.

LTE, the all IP-Network & the inexorable Big Data:-Finally, the fifth force is theglobal and unrelenting move to an all-IP network, made possible by the LTE. By

the end of 2012 there were already 144 operators with commercial launched LTE

networks while 234 are expected by the end of 2013.

This is a key enabler of the other forces, fostering the growth of peer-to-peer

communications and transactions. This leads to a separation between bearers and

services, threatening the communication providers with further distance from theultimate business and added-value layers.


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India is huge market and none of service providers can dare toignore its potential.

Thats why telecom industry is growing tremendously over the

last 2 decades.

This journey of 1 million to 50 million will keep it pace until

each citizen in India will have his own mobile.


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Industry has manyphases in its growth. Now mobile doesnt

mean a only a medium of communication. Services providersare now willing to provide varies facilities like entertainment(music, video etc.) and even banking also.

We can say that business is transforming in e-commerce to m-commerce (mobile-commerce).

In short we can say drastic change has came in the industryalong with expanding its base in subscribers, they are keepingeye not only to offer new facilities but also to be the first to

provide it.


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economic ppt section a group 7.pptx

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