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TELECOM INDUSTRY
Group 10: -
Akshita Wahi
Atul Kumar
Nitin Kumar
Sonal Bhupta
Vaibhav Kumar
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The following slides are example questions using thelayouts in the Quiz Show template. View them in slideshow to see the answer animations.
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EVOLUTION OF TELECOM INDUSTRY
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PRESENT SCENARIO
India is 4th largest market in Asia after China, Japan and SouthKorea.
India is the 5 th largest in the world
2 nd largest among emerging economies of Asia.
Contribution of telecom sector in terms of revenue is 2.1 % ofGDP as compared to 2.8% in developed economies.
Lowest tariff charges in the world.
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INDIAN TELECOM INDUSTRY FACTS
One of the fastest growing cellular markets in the world in terms ofnumber of subscriber additions 19.35 million in 3 months.
Expected to reach total subscriber base of about 500 million by2014 (i.e., more than one phone for every household)
Annual growth rate of the telecom subscribers 47 percent
More GSM subscribers than fixed-line subscribers Total telecom subscribers 225.21 million (June 2012)
Tele density 19.86 percent (June 2012)
Number of new mobile subscribers added every month 7.34 million(June 2012)
Handset market USD 4,750 million (2012-13)
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MAJOR
PLAYERS
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MARKET SHARE OF WIRELESSSERVICE PROVIDERS
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MARKET SHARE OF CDMA PROVIDERS
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Competition Extent
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EMERGING MARKETS Africa, Asia, Eastern Europe, Middle East and Latin America.
Wireless technologies and services enabling communication explosion over last decade
Nature of markets and competitive dynamics is undergoing an important shift.
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COMPETITION
Competition in the telecom space will now be focused on quality and not merely the
number of subscribers. It has changed from reliability and scale of networksto choice and flexibility of
services
Reliance Communicationsmove to offer Apples latest iPhone 5c and 5smodels bundled with unlimited voice calls, SMS and 3G mobile internet for a fixedmonthly fee over two years is significant for at least three reasons : -
Proves competitions still alive in India
Tie-up with one of the best smartphone company
The RCom-Apple deal breaks new ground--allows purchase of a high-end smartphone ininstalments with free voice, SMS and uncapped 3G data usage plans.
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Bezeq was the Israeli monopolythat controlled all international
calls coming out of Israel.
In 1997, 15 years ago, themonopoly was broken,competition was allowed, and
telephone rates dropped throughthe floor! International callsbecame cheap.
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COST
STRUCTURE
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COST STRUCTURE OF INDIAN
TELECOM INDUSTRY The telecom sector is characterised by very large investment
costs
High fixed cost Industry suffers from high fixed cost which
prove an entry barrier for new entrants
High Sunk Costs These Include - Infrastructure tenancy costs,Customer Switching Costs, Falling ARPU etc.
Wage shares are at about 1/3 of the total operating costs
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MAJOR COSTS INVOLVED
Infrastructure costs
Spectrum costs
Government Licences
Joint Ventures, mergers and acquisitions
Cost for sharing of infrastructure resources
Operating costs
Sunk Costs
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INFRASTRUCTURE COSTS
Investments in telecom networks can be divided into the followingfunctional elements:
Terminal equipment
Access Network
Switching
Transmission/Long line
Other (buildings etc.)
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ANNUAL SPECTRUM COSTS
The license fee and the spectrum charges given by theTelecom Service Providers during the last three years isgiven in the following Table:
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COST BREAKUP
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COST BREAKUP
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GROSS REVENUES OF OPERATORS
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PAT MARGINS OF OPERATORS
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Key Success
Factors
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The Telecommunications industry today is a key enabler of
productivity across economies and societies. Not only a significant contributor towards the economic activities of
countries, but also towards the growth of other industries.
In recent times, developing nations have witnessed significanttransformation within this sector due to the impact it has had on
their economies.
The booming and emerging economies of China and India have beenimpacted the most by the rapid growth of the Telecom industry inthe past decade.
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HRM STRATEGY
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STRATEGIC ROLE OF HRM
o Employee Service Assurance
o Talent acquisition
o Employee engagement & development
o Attrition Management
o Policy and Programs
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Talent acquisition:
As per the New Telecom Policy, about 2.8 million jobs will be available by 2015
Employee engagement & development:
Employee Engagement Activities are mainly conducted for the lower rankedsales force, people who are out on the field.
Common activities are: Induction programme for new employees.
Employee suggestion systems / quick responses.
Best employee awards.
Team building activities.
Leadership/career development activities
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Attrition Management
Attrition rate is high.
The growth of the industry prompted the government to allow
more players on the field.
This led to large scale migration of intellectual capital betweenorganizations.
Hence focus is on methodology and techniques to increase
employee engagement and reduce attrition.
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Policies & programs Telecom specific training for:
Processes management
Operations & Maintenance
Installations
Budgeting
Planning
Sales-marketing
Distribution
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Porter's Five Forces
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S
Largesttelecominfrastructurein the world
(US$108.98Billion)
High-performingcableequipment.
GlobalOperationalcosts down by2.9%
Pioneer in GPStechnology
Globalimpressivebrand image
Robust research
anddevelopmentdepartment(Annual patentfees revenuefrom variousorganizations atUS$2.9 Billion)
Strengths
SWOT ANALYSIS
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W
LowestAverageRevenue PerUser in India'stelecom possesa significant
problem onduration ofReturn onInvestments.
Will have toinvestheavily ininfrastructureas the
interconnectivity chargesare going tobe high
PoorTelecommunicationInfrastructure
due to whichthere is largenumber ofcall drops.
Mostcompetitive
marketE.g.-10 to 12
companies offermobile servicesin most parts ofIndia, globally,the average is 4.
Difficult toenter
because ofrequirementof hugefinancialresources.
Late adopters of
New Technology.
Weaknesses
SWOT ANALYSIS
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O
Acquisitionor mergercan lowercost of entry
in Indianscenario.
TRAI andDoT areefficienttelecomregulators as
comparedwith agenciesin othercountries .
Discountedvalue addedservice couldbe beneficialfactor
Wirelessmarket in
metros issaturated butrural areas ismajorlyuntapped..
Newtechnologies
like LTE,Wi-max
The relativeyoung
generation ofthe populousalso adds tothe lucrativemarket of thesmartphones.
Opportunities
SWOT ANALYSIS
SWOT ANALYSIS
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T
Cut throatcompetition inIndia is the
biggest threat.
Importantdecisionsimpactingeconomic growthand welfare are
difficult to passdue to the vestedinterests ofvarious politicalparties andgroups
Developing owntelecominfrastructurewill be a
challenge as toget the lawspassed will takeconsiderabletime
Threats
SWOT ANALYSIS
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VALUE CHAIN ANALYSIS
VALUE CHAIN ANALYSIS
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VALUE CHAIN ANALYSIS
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