Swot analysis bharti airtel[1]


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Swot analysis bharti airtel[1]

  1. 1. AIRTEL Bharti Airtel, usually referred to simply as "airtel", is an Indiantelecommunications company that operates in 19 countries across South Asia, Africa andthe Channel Islands. It operates a GSM network in all countries, providing 2G or 3Gservices depending upon the country of operation. Airtel is the fifth largest telecomoperator in the world with over 190 million subscribers as of September 30, 2010. It isthe largest cellular service provider in India, with over 143 million subscribers as ofSeptember 30, 2010. Airtel is the 3rd largest in-country mobile operator by subscriberbase, behind China Mobile and China Unicom. It has a 29.00% market share of the GSMmobile service in India. Airtel also offers fixed line services and broadband services. It offers its telecomservices under the Airtel brand and is headed by Sunil Bharti Mittal. Bharti Airtel is thefirst Indian telecom service provider to achieve this Cisco Gold Certification. To earnGold Certification, Bharti Airtel had to meet rigorous standards for networkingcompetency, service, support and customer satisfaction set forth by Cisco. The companyalso provides land-line telephone services and broadband Internet access (DSL) in over96 cities in India. It also acts as a carrier for national and international long distancecommunication services. The company has a submarine cable landing station at Chennai,which connects the submarine cable connecting Chennai and Singapore. It is known for being the first mobile phone company in the world to outsourceeverything except marketing and sales and finance. Its network (base stations, microwavelinks, etc.) is maintained by Ericsson, Nokia Siemens Network and Huawei., businesssupport by IBM and transmission towers by another company (Bharti Infratel Ltd. inIndia). Ericsson agreed for the first time, to be paid by the minute for installation andmaintenance of their equipment rather than being paid up front. This enabled thecompany to provide pan-India phone call rates of Rs. 1/minute (U$0.02/minute). Callrates have come down much further. During the last financial year [2009-10], Bharti hasroped in a strategic partner Alcatel-Lucent to manage the network infrastructure for theTelemedia Business. The company is structured into four strategic business units - Mobile, Telemedia,Enterprise and Digital TV. The Telemedia business provides broadband, IPTV andtelephone services in 89 Indian cities. The Digital TV business provides Direct-to-HomeTV services across India. The Enterprise business provides end-to-end telecom solutionsto corporate customers and national and international long distance services to telcos. In January 2010, company announced that Manoj Kohli, Joint Managing Directorand current Chief Executive Officer of Indian and South Asian operations, will becomethe Chief Executive Officer of the International Business Group from 1 April 2010. Hewill be overseeing Bhartis overseas business. Current Dy. CEO, Sanjay Kapoor, willreplace Manoj Kohli and will be the CEO, effective from 1 April 2010.
  2. 2. SWOT AnalysisStrengths • Bharti Airtel has more than 65 million customers (July 2008). It is the largest cellular provider in India, and also supplies broadband and telephone services - as well as many other telecommunications services to both domestic and corporate customers. • Other stakeholders in Bharti Airtel include Sony-Ericsson, Nokia - and Sing Tel, with whom they hold a strategic alliance. This means that the business has access to knowledge and technology from other parts of the telecommunications world. • The company has covered the entire Indian nation with its network. This has underpinned its large and rising customer base.Weaknesses • An often cited original weakness is that when the business was started by Sunil Bharti Mittal over 15 years ago, the business has little knowledge and experience of how a cellular telephone system actually worked. So the start-up business had to outsource to industry experts in the field. • Until recently Airtel did not own its own towers, which was a particular strength of some of its competitors such as Hutchison Essar. Towers are important if your company wishes to provide wide coverage nationally. • The fact that the Airtel has not pulled off a deal with South Africas MTN could signal the lack of any real emerging market investment opportunity for the business once the Indian market has become mature.Opportunities • The company possesses a customized version of the Google search engine which will enhance broadband services to customers. The tie-up with Google can only enhance the Airtel brand, and also provides advertising opportunities in Indian for Google. • Global telecommunications and new technology brands see Airtel as a key strategic player in the Indian market. The new iPhone will be launched in India via an Airtel distributorship. Another strategic partnership is held with BlackBerry Wireless Solutions. • Despite being forced to outsource much of its technical operations in the early days, this allowed Airtel to work from its own blank sheet of paper, and to question industry approaches and practices - for example replacing the Revenue- Per-Customer model with a Revenue-Per-Minute model which is better suited to India, as the company moved into small and remote villages and towns.
  3. 3. • The company is investing in its operation in 120,000 to 160,000 small villages every year. It sees that less well-off consumers may only be able to afford a few tens of Rupees per call, and also so that the business benefits are scalable - using its Matchbox strategy. • Bharti Airtel is embarking on another joint venture with Vodafone Essar and Idea Cellular to create a new independent tower company called Indus Towers. This new business will control more than 60% of Indias network towers. IPTV is another potential new service that could underpin the companys long-term strategy. Threats • Airtel and Vodafone seem to be having an on/off relationship. Vodafone which owned a 5.6% stake in the Airtel business sold it back to Airtel, and instead invested in its rival Hutchison Essar. Knowledge and technology previously available to Airtel now moves into the hands of one of its competitors. • The quickly changing pace of the global telecommunications industry could tempt Airtel to go along the acquisition trail which may make it vulnerable if the world goes into recession. Perhaps this was an impact upon the decision not to proceed with talks about the potential purchase of South Africas MTN in May 2008. This opened the door for talks between Reliance Communications Anil Ambani and MTN, allowing a competing Inidan industrialist to invest in the new emerging African telecommunications market. • Bharti Airtel could also be the target for the takeover vision of other global telecommunications players that wish to move into the Indian market.PEST AnalysisPolitical• 1985 Department of Telecommunications (DOT) was established to grow telecomindustry.• Earlier tariff rates were high because of high taxes. Now they are the lowest in theworld.• Government replaced the license scheme with revenue sharing scheme and extended thelicense period for 10 to 20 years.Social•Perception as “a brand of successful people”Economical•Earlier inflation rates were high•Great economic growth and continued growth of India’s economy registered a growth of21%
  4. 4. Technological•First cellular service to provide roaming service and other value added services.•Efficient customer care services.•E-commerce portal.•Introduced and involves in Broadband services, long distance services, and internetservices.Conclusion•Most successful brand in India with the largest market share.•Success is based on three pillars – connectivity, affordability and innovation.•The core is connectivity i.e. the network.•Does not promote its product always by celebrities.•Pre paid services is more expensive than post paid services.