Telecom sector

Total circles in india - 23

Important terms - ARPU  (average revenue per user), MOU (minutes of usage), active user % (how many numbers are in regular use)

Industry average - ARPU - 164Rs  ;  MOU - 423 minutes  ; idea has highest active user % (90%)

Sector Revenue - 38Billion $

FDI in telecom - 37.2Billion $ in FY 10    (telecom sector forms a very important part of fdi inflows)

Government aims at reaching 90% teledensity by 2014.

Target for Broadband coverage to reach 250000 village panchayats.

Current scenerio

Urban teledensity - 137%   ;   Rural teledensity - 28%     ; Total teledensity - 61%

Problem: Low profitability due to falling prices ; pre tax margin is 7-8%

Telecom industry is largest consumer of diesel in India. 6 million litres of diesel per day.

We have 2.4 million towers in India.

Telecom subscribers: http://www.trai.gov.in/WriteReadData/trai/upload/PressReleases/859/Press_Release_Nov-11.pdf

Internet subscribers: 17.9 million

Broadband subscribers: 10.3 million ( target of 100 million broadband connection by 2014)

14 mobile operators in India. Telecom regulators try to have a minimum of 6 operators in a circle to have competitive pricing.

3G spectrum sharing agreements.

Airtel, Vodafone and Idea have a agreement, so that a company not having not having 3G spectrum can still provide the service in that circle. Tata Docomo and aircel have a similar agreement.

TRAI  -  Telecom Regulatory Authority of India  (levying fees, compliance , license, consumer interest)

TDSAT - Telecom Dispute Settlement and Appelate  (settle dispute)

DOT - Department of Telecom ( policy making, licencing, cordination)

Telecom Commission - policy, licensing, Telecom PSU policies, standardization of equipment

IOC - Interconnect charges (money that call maker's service provider pays to receiver service provider (25p)

VAS is the new sweatspot for telecom companies. It will provide a basis for differentiation. It will help companies increase their topline.

VAS - Entertainment VAS (57%), Information VAS (39%), mCommerce (4%)

VAS - SMS, ringtone, CRBT ( caller ringback tune), games, mcommerce, mradio

VAS revenue gets divided between - Content owner (t-series etc 10%), content aggregator (hungama.com etc 15%), technology enabler (onmobile, 197, comviva etc 15%), telecom operator (maximum share 60% )

3G is a enabler of Value Added Services. VAS services like mobile internet, application download gets limited by 2G data speed. 3G can provide new features like video calling, video on demand, location based services, remote access)

3G is expected to reach ::

142 million by 2015 (12% of total subscriber base)

300 million by 2020 (20% of total subscriber base)

3G can provide speed upto 21mbps (speed depends upon the cellular phone's capability)