Trade ChakraIndia Trade ChakraIndia Business Trade Chakra
Trade Chakra

The growth of telecommunication and Internet in India has been phenomenon. The article gives an account of the telecommunication industry in India, the various service providers in telecommunication, the growth of internet and the opportunities for the industry.

Telecommunication & Internet In India

The telecommunication and internet in India has made phenomenal progress in recent past. At present the telephone network in India is one of the largest in the world. India stands at no three position in terms of telecom subscriber base, having 441.47 million subscribers.

Telecom Segments
Telecommunication sector can be classified into wire line and wireless services.

Wire line Services
It includes the basic service that is fixed line. It includes the mobile, WLL (F) and WLL (M).Public sector enterprise like BSNL and MTNL have significant market share over the fixed wire line market. Together they account for 92 per cent of the total subscriber base. Service from private sector is available in certain urban areas and account for 8 per cent of the subscriptions. Private sector usually focus on business/corporate sector and provide reliable, high end services like leased lines, ISDN, closed user group and video conferencing. They are also Internet Service Provider (ISP), Very Small Aperture Terminal (VSAT), Radio Paging Services, Public Mobile Radio Trunked Services (PMRTS), Internet Telephony and Cable TV services.

Wireless service can be further classified as:
Global System for Mobile Communications (GSM) and Code Division Multiple Access (CDMA0.The WLL (F) is operated under the CDMA technology. Some of the dominant players in the GSM sector are Airtel, Vodafone-Essar and Idea Cellular. Reliance and Tata Indicom are dominant in CDMA.

Major Players
There are three categories of players in telecom industry:
  • State owned companies (BSNL and MTNL)
  • Private Indian owned companies (Reliance Infocomm, Tata Teleservices0
  • International invested companies (Hutchison-Essar, Bharti Tele-Ventures, Escotel, Idea Cellular, BPL Mobile, and Spice Communications).
The Department of Telecom Operations, Government of India was constituted as a corporation on October 1, 2000 and came to be known as Bharat Sanchar Nigam Limited (BSNL).Today BSNL is not only the leading telecommunications company but also the largest public sector undertaking. Its asset includes a network of 45 million lines spread across 5000 towns and having 35 million telephone connections. BSNL operates basic, cellular (GSM and CDMA) mobile, Internet and long distance services throughout India (except Delhi and Mumbai).BSNL which was the third operator to provide GSM mobile services in most cities, aims to supersede Bharti to become the largest GSN operator in the country. It is the single largest operator in the Internet market, with a share of 21 per cent of the complete subscriber base.

Bharti was started in 1985; today it is one of the leading players in the telecom sector with many achievements to its credit. It was the first mobile service provider in Delhi, it was the first private telephone service provider in the country, the first company to start detailed telecom services in a foreign country in Seychelles and the first private sector service provider to launch National Long Distance Services in India. Bharti's operations are managed by two companies: the Mobility group which takes care of mobile services in 16 circles off the total available 23 circles and Infotel group which takes care of NLD, ILD, fixed line, broadband, data and satellite based services. The company has up till now laid 23,000km of optical fiber cables throughout the country, along with 1500 nodes and business interest in 200 places.

It was started on April 1st 1986 to improve the quality of telecom services, increase the telecom network, introduce new services and generate revenue for telecom expansion in major cities. Today it is amongst some of the biggest telecom operating companies in Asia. The company today has 100% digital mode for its entire telephone exchange network.

Reliance Infocomm
It provides a whole range of telecom services, covering mobile and fixed line telephony including broadband, national and international long distance services ,data services and a wide range of value added services and applications. The company plans to extend its services to the farmers, businesses, hospitals, government and public sector organizations.

Tata Tele service
It was started in 1996; the company pioneered the CDMA 1x technology platform in India. It has acquired Hughes Telecom (India) Ltd in 2002.It initiated mobile services in 2005 and today it has a nationwide presence through operations in all 22 circles. It leads the market in the fixed wireless telephony market. It has ventures into the GSM space through its joint venture with NTT DOCOMO of Japan. Today the company provides service to over 36 million customers in over 320,000 towns and villages all over India. The service provided by the company are mobile services, wireless desktop phones, public booth, telephony and wire line services and other value added services like voice portal, roaming, post paid internet services, three way conferencing, group calling, Wi-Fi Internet, USB Modem, Data cards, Calling Card services and Enterprise services.

It started its operation on April 1, 1986 as a wholly government owned corporation and as a successor to OCS. It operates a network of earth stations, switches, submarine cable systems and value added service nodes to provide a range of basic and value added services. Its main gateways centers are in Mumbai, New Delhi, Kolkata and Chennai. The International telecommunication circuits are derived through I ntelsat and Inmarsat satellites and wide band submarine cable systems. E.g. FLAG, SEA_ME_WE_2 and SEA-ME-WE-3.

Vodafone Essar Limited
It is the Indian subsidiary of Vodafone Group and started its operations in 1994 when its predecessor Hutchison Telecom acquired the cellular license for Mumbai. It has a customer base exceeding 74.08 million customers and its operations are spread throughout the country. It has got recognition like "Most Respected Telecom Company" "The Best Mobile Service in the Country" and the Most Creative and Most Effective Advertiser of the Year" over a period of time.

Idea Cellular
It is a public limited company. It is listed in the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).It is one of the leading GSM mobile services provider spread across the country. It has a customer base of 44 million in 17 service centers. It expects to start operations soon in Chennai, Kolkata and West Bengal, North East and J&K. The services it offers are basic voice & short message service (SMS) to high value service like Mobile TV, Games etc. It was the first to launch GPRS and EDGE in India.

India and Internet
The Internet has made the world a global village. During the early years internet access was limited to certain big cities and it was controlled by the Government. VSNL was given the responsible for internet activities and Department Of Telecommunications (DOT) provided inefficient service.

In 1998 the private sector was given permission to be Internet Service Providers. In the interest of the customer, the Government has set certain guidelines to grant license to prospective service providers. Any company in India with a maximum foreign equity of 74% is eligible for license. The segment has seen tremendous technological advancements.

The growth of internet has also helped e commerce. Business to Business (B2B) transactions have shown remarkable positive growth. For Indian entrepreneurs having business interest outside the country, the internet has provided an efficient, reliable, quick and cost effective mode of communication. The internet is here to stay.

  • The market is expected to grow to about US$ 8 billion by 2012.
  • The National Telecom Policy targets tele density at 15 per cent by 2010.
  • It is forecasted that by the year 2010 there would be 500 million subscribers in the Indian telecom market. Cellular subscriber base is expected to reach 88 million in 2012.

Recent Additions