Strategic analysis of Telecom sector

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Strategic analysis of Telecom sector

  1. 1. STRATEGIC ANALYSIS OF TELECOMMUNICATION SECTOR PRATIK PANDEY 13HM24
  2. 2. COMPANIES
  3. 3. TELECOM SECTOR • In 1881, Oriental Telephone Company Limited of England was the first company to open telephone exchanges at Calcutta, Bombay, Madras and Ahmedabad. • Now, India is the world's second-largest telecommunications market, with 922 million subscribers and service revenues of Rs. 54,284 crore as on 31st December 2013 (TRAI). • Major Companies are BSNL, MTNL, RELIANCE, TATA DOCOMO, IDEA, AIRCEL, VODAFONE etc.
  4. 4. TELECOM SECTOR • Source: (Press Release No. 13/2014)TRAI.
  5. 5. Number of Telecom Subscribers • Source: (Press Release No. 13/2014)TRAI.
  6. 6. Service Provider wise Market Share as on 31st January, 2014. • Source: (Press Release No. 13/2014)TRAI.
  7. 7. Service Provider wise net subscriber addition during January, 2014 • All data's in Millions. • Source: (Press Release No. 13/2014)TRAI
  8. 8. Service Provider wise Market Share of wire line subscribers as on 31st January, 2014 • Source: (Press Release No. 13/2014)TRAI
  9. 9. Company Profiles COMPANY INFORMATION BSNL BHARTI AIRTEL RELIANCE COMMUNICATONS IDEA CELLUAR INDUSTRY Telecom Telecom Telecom Telecom TYPE State-owned enterprise Public company BSE: 532454 NSE:BHARTIARTL Public company NSE: RCOM BSE: 532712 Public BSE: 532822 NSE: IDEA FOUNDED 1st October,2000 7 July 1995 2004 1995 HEAD QUARTERS New Delhi, India New Delhi, India Mumbai, India Santacruz East, Mumbai, India KEY PEOPLE R.K. Upadhyay (Chairman & MD) Sunil Bharti Mittal Anil Ambani (President) Kumar Mangalam Birla (Chairman)
  10. 10. .COMPANY INFORMATION BSNL BHARTI AIRTEL RELIANCE COMMUNICATONS IDEA CELLUAR Products Fixed line and mobile telephony, Internet services, digital television, IPTV Fixed line and mobile telephony,broadband and fixed-line internet services, digital television and IPTV mobile telephony,broadba nd and fixed-line internet services, digital television and IPTV Mobile telephony, Wireless broadband Revenue Rs.279.33 billion(2011-12 Rs.419.31 billion (2012 Rs.218 billion (2013) 15389.00 crore (2011) Net income Rs. 88.51 billion (2011–12) Rs.53,700 million (2012) Rs.6.72 billion (2013) 844.60 crore (2011) Employees 244,891 (as on 19 November 2013) 21,299 (2012) 18,070 (2013) 6,481 (2010) Owner(s) Government of India Bharti Enterprises (52.7%)[3][4] SingTel (15.57%)[3][4] Vodafone (4.4%) Reliance Group Aditya Birla Group (49.05%) Axiata Group Berhad (19.96%) Providence Equity (10.6%)
  11. 11. BSNL MISSION: • Be the leading telecom service provider in India with global presence. • To Provide world class telecom infrastructure to develop country's economy. • Leveraging technology to provide affordable and innovative products/services across customer segments VISION: • To become the largest telecom Service Provider in Asia
  12. 12. BSNL Tagline/ Slogans Connecting India; BSNL hai to bharosa hai USP SMS rates are reasonable; high speech quality and is capable of delivering high bandwidth using DSL technologies Segment Senior citizens, Conservative audiences Target Group Middle class from urban and rural areas Positioning Most reliable and low priced service
  13. 13. S W T Strengths • Alliances with Ericsson and Cisco Systems • IT alliances with HP Compaq, interconnecting alliances • Selling capacity of 25 million per annum • Has an excellent network coverage across India Opportunities • Strong strategic alliances with network companies may help BSNL Communication to focus on marketing its services • Untapped rural markets Threats • Competitors low price offering • 2. Saturation point in Basic telephony service • 3.Mobile Number Portability O Weaknesses Suffers from high call dropping rates and a reduction in brand equity Has a major presence only in C’ Circle Low brand visibility and low brand loyalty SWOT ANALYSIS
  14. 14. BHARTI AIRTEL MISION: • “We at Airtel always think in fresh and innovative ways about the needs of our customers and how we want them to feel. We deliver what we promise and go out of our way to delight the customer with a little bit more” VISION: • “To be globally admired for telecom services that delight customers”
  15. 15. BHARTI AIRTEL Tagline/ Slogans Express yourself USP Top brand in India and Brand connect Segment Elite class of people; Corporates Target Group Elite class above 25 years age; YUPS(Young Upward Professionals) Positioning Aspirational and lifestyle brand; Premium category
  16. 16. S W T Strengths •Largest Telecom operator in the world with 207.8 •Only Indian operator, with VSNL, that has an international submarine cable •4.High brand visibility •5.Strong advertising with celebrity brand ambassadors Opportunities • Fast expanding cellular market • Latest and low cost technology • Untapped rural market • Threats O Weaknesses • Price competition from BSNL and MTNL • Untapped Rural Market • New entrant's low price offering • Saturation point in Basic telephony service • Mobile Number Portability SWOT ANALYSIS
  17. 17. Reliance Communications MISSION: • Meeting and exceeding Customer expectations with a segmented approach • Establishing, re-engineering and automating Processes to make them • customer centric, efficient and effective VISION: • By 2015, be amongst the top 3 most valued Indian companies, providing Information, Communication & Entertainment services, and being the industry benchmark in Customer Experience, Employee Centricity and Innovation
  18. 18. Reliance Communications Tagline/ Slogans Karlo Duniya mutthi mein USP Connection with handset Segment Lower and lower middle Target Group Villagers, poor, Daily wagers Positioning World in your hands
  19. 19. S W T Strengths • Flexible plans • Good advertising • High brand visibility • Celebrity brand ambassadors • Ability to attract customers with various plans Opportunities • Fast expanding cellular market • Latest and low cost technology • Untapped rural market • Threats O Weaknesses • Price competition from BSNL and MTNL • Untapped Rural Market • New entrant's low price offering • Saturation point in Basic telephony service • Mobile Number Portability SWOT ANALYSIS
  20. 20. IDEA CELLUAR Mission: • We will delight our customers while meeting their individual communication needs time anywhere. We survive because of our customers. VISION: • To be the most customer-focused mobile service brand, continuously innovating to help liberate our customers from the shackles of time & space.
  21. 21. IDEA CELLUAR Tagline/ Slogans An idea can change your life USP Big brand with great service Segment Middle and upper middle class Target Group Students (majority out station), workers, labourers Positioning Smartness that comes with using Idea
  22. 22. S W T Strengths •.Flexible plans • Good advertising • High brand visibility • Celebrity brand ambassadors • Ability to attract customers with various plans Opportunities • Fast expanding cellular market • Latest and low cost technology • Untapped rural market • Threats O Weaknesses • Price competition from BSNL and MTNL • Untapped Rural Market • New entrant's low price offering • Saturation point in Basic telephony service • Mobile Number Portability SWOT ANALYSIS
  23. 23. COMPARISON COMPANY ANALYSIS BSNL BHARTI AIRTEL RELIANCE COMMUNICATIONS IDEA CELLUAR Strengths IT alliances with HP Compaq, interconnecting alliances Selling capacity of 25 million per annum Has an excellent network coverage across India Largest Telecom operator in the world with 207.8 Only Indian operator, with VSNL, that has an international submarine cable Flexible plans Good advertising Ability to attract customers with various plans Good advertising High brand visibility Celebrity brand ambassadors Weakness Suffers from high call dropping rates. Low brand visibility and low brand loyalty Price competition from BSNL and MTNL Untapped Rural Market Price competition from BSNL and MTNL Untapped Rural Market Price competition from BSNL and MTNL Untapped Rural Market
  24. 24. COMPARISON COMPANY ANALYSIS BSNL BHARTI AIRTEL RELIANCE COMMUNICATIONS IDEA CELLUAR Opportunities Adoption of Next Generation Networks (NGN) is global . Untapped rural markets Fast expanding cellular market Latest and low cost technology Untapped rural market Fast expanding cellular market Latest and low cost technology Untapped rural market Fast expanding cellular market Latest and low cost technology Untapped rural market Threats Low price of Competitors Mobile Number Portability Saturation point in Basic telephony service Mobile Number Portability Saturation point in Basic telephony service Mobile Number Portability New entrant's low price offering Mobile Number Portability
  25. 25. Porter five forces analysis
  26. 26. Porter five forces analysis • Threats of new entry : Low • Bargaining power of Suppliers : Medium • Bargaining power of Buyers : High • Internal and External rivalry : High • Threats of Substitutes : High
  27. 27. Critical success factors • Product quality, employee attitudes(particularly BSNL), manufacturing flexibility, and brand awareness. • Explore rural market • Proper market segmentation • Better network services (Reliance and BSNL)
  28. 28. Competitive Advantages • BSNL has an advantage in that it does have to pay the 8-12 per cent revenue share that other private operators do to the government as licence fees. • BSNL does not have to pay the large share of the revenue as interconnect charges for routing the landline calls and STD calls. • In 2011, Idea acquired 3G licences for 11 circles for Rs 5,800 crore. • Reliance is a well known brand and it adds advantage in terms of brand visibility. • Bharti’s acquisition of Zain, gives Bharti the access to Africa.
  29. 29. CONCLUSION • From the study it is found that PSU’s like BSNL and MTNL has lost its grip in telecom sector because of poor governance and very less marketing strategies. Private sectors are gaining more market share. Though the threats of new entry are very less, the completion among the existing players is very high. The swot analysis and Porters five forces model shows very little difference among the companies, because the companies provide exactly the same products and services.

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