Apple has recently announced the launch of
iPhone which will use CDMA network in India.
Until now, the phone was only available on
Reliance unveiled India’s first iPhone on CDMA
network on June 28, 2013.
The objective of this presentation is to analyse
whether the present market is conducive for
the sale of iPhones on CDMA network and the
business prospects of this launch of iPhones
working on CDMA network.
There are 2 major types of mobile
networks which are available in mobile
1. GSM Network
2. CDMA Network
GSM stands for Global System for Mobile Communication
and is an open, digital cellular technology used for
transmitting mobile voice and data services.
The GSM emerged from the idea of cell-based mobile
radio systems at Bell Laboratories in the early 1970s.
The GSM is the name of a standardization group
established in 1982 to create a common European mobile
The GSM standard is the most widely accepted standard
and is implemented globally.
The GSM is a circuit-switched system that divides each
200kHz channel into eight 25kHz time-slots. GSM operates
in the 900MHz and 1.8GHz bands in Europe and the 1.9GHz
and 850MHz bands in the US.
The GSM is owning a market share of more
than 70 percent of the world's digital cellular
The GSM was developed using digital
technology. It has an ability to carry 64 kbps to
120 Mbps of data rates.
Presently GSM supports more than one billion
mobile subscribers in more than 210 countries
throughout the world.
The GSM provides basic to advanced voice
and data services including Roaming service.
Roaming is the ability to use your GSM phone
number in another GSM network.
Improved spectrum efficiency.
Low-cost mobile sets and base stations
Compatibility with other telephone
Support for new services.
CDMA stands for Code Division Multiple Access, a digital
cellular technology that uses spread spectrum techniques.
As the term implies, CDMA is a form of multiplexing, which
allows numerous signals to occupy a single
transmission channel, optimizing the use of
The CDMA standard was originally designed by
Qualcomm in the U.S.
With CDMA technology, data and voice packets are
separated using codes and then transmitted using a wide
frequency range. Since more space is often allocated for
data with CDMA, this standard became attractive
for 3G high-speed mobile Internet use.
CDMA consistently provides better capacity for
voice and data communications than other
commercial mobile technologies, allowing more
subscribers to connect at any given time, and it is
the common platform on which 3G technologies
Unlike GSM which has a SIM card, so that the
phone can be easily swapped, CDMA cell phones
have an inbuilt R-UIM(Removable User Identity
Module) where this is not possible.
Improved Call Quality
Greater coverage for lower cost
Improved security and privacy
Increased Data Throughput
From the above chart, it is very clearly that the
number of GSM users are very large in number as
compared to the number of CDMA users.
Bharti Airtel, Vodafone India, Idea Cellular and Spice
which are some of the major service providers in the
country do not even provide services to CDMA users.
Even though Reliance Communications, BSNL and
Tata Teleservices provide services to the CDMA
users, the number of GSM users are more than the
number of CDMA users.
Thus we can discern that CDMA network has not
been able to establish itself so strongly as the GSM
As it has been established that GSM is more widely
used than CDMA, it is important to find out the
reasons for the greater usage of GSM network.
The following points will be helpful in comparing the 2
Coverage: The most important factor is getting
service in the areas you will be using your phone.
Upon viewing coverage maps you can discover that
GSM network has a wider coverage as compared to
CDMA network. It is because the GSM network came
into existence before the CDMA network and the
number of GSM users are more than that of CDMA
Data Transfer Speed: With the advent of cellular phones
doing double and triple duty as streaming video
devices, podcast receivers and email devices, speed is
important to those who use the phone for more than
making calls. CDMA has been traditionally faster than
GSM, though both technologies continue to rapidly
leapfrog along this path. Both boast "3G" standards, or
3rd generation technologies
Subscriber Identity Module (SIM) cards: Only GSM
phones use SIM cards. The removable SIM card allows
phones to be instantly
activated, interchanged, swapped out and
upgraded, all without carrier intervention. The SIM itself
is tied to the network, rather than the actual phone.
Phones that are card-enabled can be used with any
Roaming: For the most part, both networks have fairly
concentrated coverage in major cities and along major
highways. GSM carriers, however, have roaming contracts with
other GSM carriers, allowing wider coverage of more rural
areas, generally speaking, often without roaming charges to the
customer. CDMA networks may not cover rural areas as well as
GSM carriers, and though they may contract with other CDMA
carries for roaming in more rural areas, the charge to the
customer will generally be significantly higher.
International Roaming: If you need to make calls to other
countries, a GSM carrier can offer international roaming, as GSM
networks dominate the world market. By purchasing a SIM card
with minutes and a local number in the country you are
visiting, you can make calls against the card to save yourself
international roaming charges from your carrier back home.
CDMA phones that are not card-enabled do not have this
According CDG.org, CDMA networks support over 270 million
subscribers worldwide, while GSM.org tallies up their score at
over 1 billion.
Global Reach: GSM is in use over 80% of the world’s mobile
networks in over 210 countries as compared to CDMA.
CDMA is almost exclusively used in United States and some
parts of Canada and Japan. As the European Union
permissions GSM use, so CDMA is not supported in Europe.
In North America, especially in rural areas, more coverage
is offered by CDMA as compared to GSM. As GSM is an
international standard, so it’s better to use GSM in
international roaming. GSM is in use by 76% of users as
compared to CDMA which is in use by 24% users.
Security: More security is provided in CDMA technology as
compared with the GSM technology as encryption is
inbuilt in the CDMA. A unique code is provided to every
user and all the conversation between two users are
encoded ensuring a greater level of security for CDMA
users. The signal cannot be detected easily in CDMA as
compared to the signals of GSM, which are concentrated
in the narrow bandwidth. Therefore, the CDMA phone
calls are more secure than the GSM calls. In terms of
encryption the GSM technology has to be upgraded so as
to make it operate more securely.
Recently, Reliance Communications
launched India’s first iPhone running on
its CDMA’s network.
In order to find out whether the launch of
iPhone on CDMA will be successful or
not, a comparison should be made
between iPhone on GSM and CDMA
The iPhone GSM model is available with carriers
worldwide while the iPhone CDMA model is only
available with certain carriers.
From a functional standpoint, the major change is
that the GSM-equipped iPhone 4 supports the
EDGE "2G" mobile wireless standard as well as 3G
networking. The iPhone 4 (CDMA) model, on the
other hand, instead supports CDMA (EV-
DO), which means that global coverage is
considerably more limited.
Other limitations of the CDMA model include the
inability to receive voice and data simultaneously
and slower data altogether, the inability to place a
call on hold and conference calls are limited to
two calls rather than five. These limitations are due
to the older CDMA standard rather than the phone
From the chart and the information presented above
it is very clear that the iPhone CDMA model does not
provide any advantages as compared to the iPhone
GSM model and instead has a few limitations.
Apart from that, the prices of both the GSM models
and CDMA models is the same, so the customer does
not get any additional benefit from buying the
The prospect of launching iPhone in CDMA is not a
viable option as the company will not going to
benefit from its launch and instead has to incur some
Thus the launch of iPhone CDMA model is not a
beneficial business prospect as the CDMA model
doesn’t provide anything new to the customers.