New Entrants In Indian Telecom New Entrants In Indian Telecom Industry

CDMA,GSM,3G & IPTV

By- Viral SoniM.Tech Construction & Project ManagementCEPT UniversityCEPT UniversityAhmedabad

It all started like thisIt all started like thisFirst telephone (photophone) – Alexander Bell, 1880

The first car mounted radio

telephone – 1921

Going furtherGoing further1946 – First commercial mobile radio-telephone service by Bell and AT&T in Saint Louis, USA. Half duplex(PTT)

1973 – First handheld cellular phone – Motorola.

F ll l First cellular net

Bahrein 1978

But what’s cellular?But what’s cellular?MSC

BS

HLR, VLR, AC, EIR

PSTN

Cellular principlesCellular principlesFrequency reuse – same frequency in

many cell sites

Cellular expansion – easy to add new cells

Handover – moving between cells

Roaming between networks

INDIAN MARKET

Indian Market

Total Number of telephones 281.62 million at the end of January 2008.Current addition: 8 million lines per month perhaps the Current addition: 8 million lines per month, perhaps the highest in the world

Target 2010: 500 million connectionsBroadband Subscribers

March 31, 2005: 0.18 million

D b 2007 3 02 illiDecember, 2007: 3.02 million

Public vs. Private

I di T l G th M bil D iIndian Telecom Growth - Mobile Driven300

200

250

s (M

io)

100

150

Subs

crib

ers

0

50

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008*

Financial Year

Wireline Wireless

Wireline subscribers have been steady at around 40 Mio for the past 3 yearsy p y

Growth in Fixed line attributed to fixed wireless growth

H lth titi i H d t k tHealthy competition in Handset market

Large number of Handset OEMs with lack of dominant market share helps create a competitive market place

Affordable wireless services

R id i l b ib Rapid wireless subscribers ramp-up

O 61 M l b b dd d f CDMA d dOver 61 Mn net wireless subscribers added since competition from CDMA was introduced

New Entrants Vs. Existing PlayersBSNL

Existing IncumbentLoss of 8% market share p.a.Still the Largest

To promote tele-densityPromote competitionBenefits of Technology Must Reach the Last Man in the Last VillageTeledensity covers only 1/4th of the Population, hence 3/4th of theMarket untappedN tr t ld d i t fr th t d l d pr id p titiNew entrants would deviate from that model and provide competitionExisting players left to themselves would skim the market from top to bottom

would be a time consuming process. g p

Inclusion

Regulatory FrameworkRegulatory Framework

Supreme Court

TDSAT

TRAIDoT Ministry of I & B

Security Issues

Telecommunications & Media sector- Traditionally considered to be Sensitive Sectors

S i S iti D t i tiSecuring Sensitive Data communicationsBlackberry Case

Hosting vs. Routingg g

India prefers Hosting

Spectrum IssuesAllocation of Spectrum- Conflict between New Players andExisting Incumbents

- Government has started allocating spectrum to new players- Spectrum Allocated to Defense, Railways, ONGC, BSNL and

hother Government Departments;acquisitions- Major Players acquiring smaller networks forSpectrum (but 3 year lock in for new entrants to discourageSpectrum (but 3 year lock-in for new entrants to discouragearbitrage impedes consolidation)3 G Spectrum- Bone of contention between GSM & CDMAp foperators

GENERATIONS IN TELECOM GENERATIONS IN TELECOM INDUSTRY

Generation 1Generation 1Generation #1 – Analog [routines for sending voice]

All systems are incompatible

No international roaming

Little capacity – cannot accommodate masses of subscribers

Generation 2Generation 2Generation #2 – digital [voice encoding]g gIncreased capacity

More securityMore security

Compatibility

C TDMA CDMA f i i Can use TDMA or CDMA for increasing capacity

Generation 2 5Generation 2.5Generation #2.5 – packet-switching

Connection to the internet is paid by packets and not by connection time.

Connection to internet is cheaper and faster [up to 56KBps]

The service name is GPRS – General Packet Radio Services

Th f t i G ti #3 The future is now.. Generation #3

Permanent web connection at 2Mbps

Internet phone and media: 3 in 1Internet, phone and media: 3 in 1

The standard based on GSM is called UMTS. Not t i l t dyet implemented.

The EDGE standard is the development of GSM d 3G towards 3G.

Migration To 3G2G

2.5G

2.75G 3G

Packet Data

IntermediateMultimedia

MultimediaMigration To 3G

GSM GPRS

115 Kbps

EDGEW-CDMA (UMTS)

1GAnalog Voice

Digital Voice

TDMA

115 Kbps

384 Kbps Up to 2 Mbps

TACS

NMT

GSM/GPRS

(Overlay) 115 Kbps

9.6 Kbps

TD-SCDMA

2 Mbps?

CDMA 1xRTT cdma2000

TACS

AMPS

115 Kbps 9.6 Kbps

9.6 Kbps

PDC

p

9.6 Kbps

iDEN(Overlay)

iDEN

CDMA

PHS (IP-Based)

64 Kbps

CDMA 1xRTT

144 Kbps

cdma20001X-EV-DV

Over 2.4 Mbps

2001+2003+

2003 - 2004+

AMPS

14.4 Kbps/ 64 Kbps

PHS

1992 - 2000+2001+

1984 - 1996+ Source: U.S. Bancorp Piper Jaffray

2G

Upgrade Cost, By Technology2G GSM CDMA TDMA

2.5G / 2.75G GPRS CDMA 1x GSM/GPRS/EDGE

Software/Hardware Software-based Hardware-based Hardware and software

Cost Incremental Substantial Middle of the road

3G W-CDMA cdma2000 W-CDMA

S f /H d H d b d S f b d H d b dSoftware/Hardware Hardware-based Software-based Hardware-based

Cost Substantial Incremental Middle of the road

CDMA upgrade to 2.75G is expensive; to 3G is cheap

GSM upgrade to 2.5G is cheap; to 3G is expensive

TDMA upgrade to 2.5G/3G is complex

Takeaway: AT&T and Cingular have a difficult road to 3Gy g

TDMA…

TDMATDMATime Division Multiple Access

Each channel is divided into timeslots, each conversation uses one timeslot.

Many conversations are multiplexed into a single channel channel.

Used in GSM

CDMA…

CDMACDMACode Division Multiple Access

All users share the same frequency all the time!

To pick out the signal of specific user this signal is To pick out the signal of specific user, this signal is modulated with a unique code sequence.

2.Cdma (code division multiple access )One of the basic concepts in data communication is the idea of allowing several transmitters to send information simultaneously over a single communication channel. co u cat o c a e . This allows several users to share a bandwidth of frequencies. This concept is called multiplexing. Cdma employs spread-spectrum technology and a special coding scheme (where each transmitter is special coding scheme (where each transmitter is assigned a code) to allow multiple users to be multiplexed over the same physical channelp p y

Why CDMA ?Why CDMA ?• Better voice clarity & consistent quality

• Enhanced privacyp y

• Superior power control

• Lowest radiation level

• Increased talk time for mobile phones

• High Speed Data

• High speed Internet access

• India has less than 0.4% PC penetration (residential)

CDMA 1 h d i h 140 kb d ff i l i f il d I • CDMA 1x handsets with 140 kbps speed offers a superior alternative for e-mail and Internet access

• Advanced platform for building highly innovative applications

• Most successful 3G technology

• CDMA2000 controls 85% of the World’s 3G market and adds 15 million new users per quarter Worldwide

• Even the GSM 3G evolution relies on Intellectual property created by CDMA!

CDMA TodayCDMA Today• Operational in the country with 43 private networks

• Has more than 21 million subscribers in the country

• Created new markets for mobile services

• Over 1 Mn PCOs operational

• More than 285 Mn subscribers 130 operators and 210 More than 285 Mn subscribers, 130 operators and 210 networks Worldwide

• India is emerging as the key driver of growth for CDMAg g y g

• CDMA created a competitive landscape that made wireless affordable

GSM

GSMGSM« Groupe Special Mobile », later changed to p p , g« Global System for Mobile »

Joint European effort beginning in 1982Focus on seamless roaming across EuropeFocus on seamless roaming across Europe

Services launched 1991Time division multiple access (8 users per 200KHz)900 MH b d l t t d d t 1800MH900 MHz band; later extended to 1800MHzAdded 1900 MHz (US PCS bands)

GSM is dominant world standard todayWell defined interfaces; many competitorsNetwork effect (Metcalfe’s law) took hold in late 1990sTri-band GSM phone can roam the world todayp y

Gsm (global system for mobile communication)

The most popular standard for mobile phones in the world.

Its promoter, the gsm association, estimates that 82% of the global bil k t thi t d dmobile market uses this standard.

Gsm is used by over 2 billion people across more than 212 countries

Is considered a second generation (2g) mobile phone system.

3G….

3G – What is it?3G is a term coined by global cellular community to indicate the next generation of mobile service capabilities (Higher capacity / Enhanced network Functionalities) that allow advanced services and applications, including multimedia – ITU

some key requirements of 3G service includeImproved system capacityBackward compatibility with 2G systemsMulti media support andHigh speed packet data services meeting the following criteriaHigh speed packet data services meeting the following criteria

2 mbps in fixed or in building environments

384 kbps in pedestrian or urban environments

144 kbps in wide area mobile environments

Variable data base in large geographic area systems (satellite)

3g technologyThe technology intended for smartphones- multimedia cellphones

IT PROVIDE 3mbps SPEED FOR DOWNLOADING WHICH IS VERY HIGH AS COMPARED TO THAT OF 2G TECHNOLOGY

It provide intrenet surfing downloading audio video conferencing fax It provide intrenet surfing, downloading,audio video conferencing, fax service and many other broad band applications

3g technology was implemented in japan for the first time in the world

Today the tech. Is serving 25 countries over more than 60 networks in asia, europe and u.S.

Bsnl india will launch 3g tech from dec.2008 in indiag

3G Vision3G VisionUniversal global roaming

Multimedia (voice, data & video)

Increased data rates384 kbps while moving2 Mbps when stationary at specific locations

Increased capacity (more spectrally efficient)Increased capacity (more spectrally efficient)

IP architecture

ProblemsProblemsNo killer application for wireless data as yetVendor-driven

3G technology – a large opportunity for I diIndia

Biggest Threat to Today’s 3G —Wi l LANWireless LANs

Faster than 3G11 56 Mb <2 Mb f 3G h t ti11 or 56 Mbps vs. <2 Mbps for 3G when stationary

Data experience matches the InternetWith the added convenience of mobile

f d ’ l llSame user interface (doesn’t rely on small screens)

Same programs, files, applications, Websites.

Low cost, low barriers to entry

Organizations can build own networksLike the Internet, will grow virally

Opportunity for entrepreneurs!pp y p

Opportunity for wireless operators?

IPTV

Regulatory Challenges in IPTV S iIPTV Services

Unclear Policy FrameworkNature of Service not clearExisting legislation notExisting legislation notsufficientClarity on down linking

id liguidelinesContent regulationFDI Cap- Non Level Playingp y gfield

TRAI RecommendationsTRAI RecommendationsTo solve the regulatory issues concerning IPTV Services TRAI has

recommended the following to DOT & I&B Ministryrecommended the following to DOT & I&B Ministry

1) Telecom Operators to provide IPTV services under UASLp pLicense

2) Telecom licensees while providing TV channels through IPTV2) Telecom licensees while providing TV channels through IPTVshall transmit only such channels in exactly same form(unaltered) for which broadcasters have received up-linking/down linking permission from Government of Indialinking/down-linking permission from Government of India(Ministry of Information and Broadcasting)

TRAI Recommendations (Contd ) TRAI Recommendations (Contd.) 3)The up linking/down linking guidelines should be

amended to enable the broadcasters to provide signals toall distributors ofTV channels

l d d4)Telecom service providers providing IPTV service not toproduce any news content and to show only those newschannels which have permission from I & B Ministrychannels which have permission from I & B Ministry

FUTURE PROSPECT OF TELECOM SECTORIndia poised to be a USD 40 bn - 45 bn telecom market by FY

2010

Telecom sector targets announced by

Government of India

• 250 million subscribers in 2007

• 500 million subscribers by 2010

• 20 million broadband subscribers by 2010

• Mobile access to all villages with population more

than 5,000 by 2006

• Mobile access to all villages with population of more

than 1,000 by 2007

Opportunities in Telecom SectorOpportunities in Telecom SectorTelecom Infrastructure ServicesFavourable Investment ClimateFavourable Investment ClimateTotal No. of Subscribers – Increase

Yield per Subscriber from traditional streams may decrease due to higher competition, new entrants

ll h h T ff h h h ldStill higher Tariff Margins then any where in the worldPossibility:

3G Services – 20094G Services – 20114G Services 2011

Value Added Services – 15% of yield Caller Tunes, Ring Back ServiceLess SkimmingAll small and medium players – growth opportunity for international player

THANK YOUTHANK YOUResented by-Mohini Ghanwat (0207)-Bimal Shah (1307)( )-Ankur Sharma (1407)-Viral Soni (1507)

EDGE-Enhanced Data rates for Global Evolution

Packet Data Serving Node (PDSN)

HSDPA (High Speed Downlink Packet Access