21. Vision 2010 By 2010 Airtel will be the most admired brand in India: Loved by more customers Targeted by top talent Benchmarked by more businesses
22. Vision 2020 To build India's finest business conglomerate by 2020 Supporting education of underprivileged children through Bharti Foundation Strategic Intent: To create a conglomerate of the future by bringing about “Big Transformations through Brave Actions.”
23. Mission “ 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”
24.
25. Being Flexible - to adapt to the changing environment and evolving customer needs
26. Making it Happen - by striving to change the status quo, innovate and energize new ideas with a strong passion and entrepreneurial spirit
37. 12 Why Mad Rush for Telecom ?? Low teledensity (depicting large untapped potential) Large number of additions in telecom subscribers Telecom Advantage GROUP 7 CAGR 40.4%
38. 13 Evolution of Telecom In India Department of Telecommunication (DoT) is the main body formulating laws and various regulations for the Indian telecom industry. ILDservices was opened to competition BSNL was established by DoT Number portability was proposed (pending) Intra-circle merger guidelines were established Independent regulator, TRAI, was established Private players were allowed in Value Added Services Calling Party Pays (CPP) was implemented Attempted to boost Rural telephony Go-ahead to the CDMA technology 1999 2007 1994 2002 2005 2003 2004 2006 2000 Internet telephony initiated Unified Access Licensing (UASL) regime was introduced INDIA 1992 1997 Broadband policy 2004 was formulated—targeting 20 million subscribers by 2010 Decision on 3G services (awaited) National Telecom Policy (NTP) was formulated NTP-99 led to migration from high-cost fixed license fee to low-cost revenue sharing regime Reduction of licence fees FDI limit was increased from 49 to 74 percent Reference Interconnect order was issued ILD – International Long Distance GROUP 7
39. Telecom Ecosystem 14 Indian Telecom Industry Framework Indian Government Bodies Independent Bodies They formulate various policies and pass laws to regulate the telecom industry in India. They undertake various research activities and monitor the quality of service provided in the Indian telecom industry. They also provide various recommendations to improve the status of telecom operations in India. Wireless Planning and Coordination (WPC) Handles spectrum allocation and management Department of Telecommunications Telecom Regulatory Authority of India (TRAI) DoT – Licensee and frequency management for telecom Independent regulatory body Telecom Disputes Settlement and Appellate Tribunal (TDSAT) Telecom Commission Telecom disputes settlement body Exclusive policy making body of DoT Handles ad hoc issues of the telecom industry Group on Telecom and IT (GoT-IT) GROUP 7
49. Technology CDMA – Already there are big players in this segment Reliance , Tata 3G – Value added services potential still to be tapped fully 2G/3G – GSM Currently commands 70% of mobile subscribers in India
52. 1. Threat from Competition Wireless Market – Top 4 garnering 75% market share 22 GROUP 7 HIGH
53. Competitor Analysis 23 GROUP 7 Best OP Margins & Net Profit Margins among Peers Source: CMIE November 2008
54. AMOU & ARPU Stats Minutes of Usage per Month – Mobile Services Despite a low teledensity of approximately 19 percent, India has the second highest minutes of usage per month. This offers huge growth opportunity to telecom companies. ARPU* in India – Mobile Services The declining ARPU implies that India Inc. is tapping a large market at the bottom of the pyramid by reducing tariffs; thereby, enhancing affordability. 24 GROUP 7
72. SWOT Strengths Largest Telecom Player in India - ~80Mn, 22.6% Strategic Alliance with other stakeholders in Bharti Airtel include Sony-Ericsson, Nokia - and Sing Tel Pan India Presence Strong Financials Weakness Outsourcing of Core Systems Lack of emerging market investment opportunity Source: CMIE Report NOV 08 30 GROUP 7
76. Low Broadband Penetration, Rural TelephoneyThreats India centric – Major revenues from India Falling ARPU & AMOU Intense Competition & Shortage of Bandwidth 31 GROUP 7
77. BCG Matrix for Bharti Airtel HIGH Mobile Services DTH & IPTV Broad Band Market Growth Rate LOW LOW HIGH Market Share 32 GROUP 7
78. GE Matrix Classification Business Strength Strong Medium Weak 5.00 High 3.67 Medium Market Attractiveness 2.33 Low 33 GROUP 7 5.00 1.00 2.33 3.67
90. Airtel’s GE Matrix Business Strengths Low High 5.00 High Attractive Airtel Enterprise Mobile 3.67 Moderate Attractive Market Attractiveness TeleMedia 2.33 Unattractive Low 5.00 1.00 2.33 3.67 37 GROUP 7
91. Airtel – Strategy MANTRA : Focus on Core Competencies and Outsource the rest!
92.
93. It has managed to work with the best of domain specialists globally and emerge as a world class entity.
94.
95. Outsourcing deals in 2004 Ericsson was given the mandate to provide, manage and maintain the equipment as well as provide quality assurance in Airtel‘s then 13 mobile circles. IBM was given the mandate to handle the back office requirements of Airtel’s presence in India
96.
97. Aim to be become a one stop shop for all telecommunication services under the Bharti umbrella.
Best service provider, good call center serice esp. in local languages, good service even in the remote areas, emphasis on “barriers break when people speak”, new initiatives like google search on airtellive, downloads etc2. Long term HR strategy, Gallup Great Workplace Award, Both internal development as well as external hiring, development programs with iims etc, Young leader development program for top 18 MBA prog3. retail, insurance, realty
MNP – Mobile Number Portability
The CDMA subscriber base has reached 74.36m in the quarter ending June 2008 as against 68.37m at the end of the previous quarter. The growth in this quarter is 8.76% as against 11.37% for the previous quarter. Reliance remains the largest CDMA mobile operator followed by Tata Teleservices and BSNL with subscriber base of 42.71m, 26.33m and 4.59m respectively. Wimax – This is a disruptive technology facing Indian telecosVoIP – This will put pressure on the Telecos since ISP can offer virtually free internet based mobile phones – Also License fees is 2 Cr against 1650 Cr for telecom operators4 G – people are already talking about it
Cellular Services address the communication needs and staying connected.Hence a necessityThere is no substitute that can replace it completely.
What they are doing in retail for last 4 years. What to put in Cash Cow.BhartiInfratelThe Company has entered into a joint ventureagreement with Vodafone Essar Limited (Vodafone)and Idea Cellular Limited (Idea) to form an independenttower company (“Indus Towers Limited” or “IndusTower”) to provide passive infrastructure services in16 circles of India. The Company and Vodafone willhold approximately 42% each in Indus Tower and thebalance 16% will be held by Idea. Pursuant to theaforesaid agreement, BhartiInfratel Limited hassubscribed 50,000 equity shares of Rs. 10 each in IndusTowers Limited on December 17, 2007 for an aggregatevalue of Rs. 500 thousand. For this purpose, BhartiInfratel Ventures Limited has been incorporated as awholly owned subsidiary of BhartiInfratel Ltd. Thetelecom passive infrastructure will be transferred toBharti Infratel Ventures for ultimate merger in IndusTowers Limited.TheCompany’s 61,984,721 mobile customers accounted fora 23.8% of wireless (GSM + CDMA) market share as onMarch 31, 2008.The revenues from the mobile services for the financialyear were Rs. 218,697 mn., a growth of 55% over therevenues in the previous financial year. The mobile servicesbusiness contributed 80% to the consolidated revenues.Telemedia ServicesDuring the year, the Broadband and Telephone Servicesbusiness was renamed as Telemedia Services in line withthe Company’s growing focus on new media solutionsand foray into IPTV and DTH businesses.The Company provides broadband (DSL) and telephoneservices (fixed line) in 15 circles spanning over 94 citiesacross India. As on March 31, 2008, the Company had2,283,328 customers (a growth of 22%), of which 34.8%(~795,000) were subscribing to broadband / internetservices.The Company’s strategy for Telemedia business is to focuson the cities with high revenue potential, excepting forDTH which will be an all India offering. The productoffering in this segment includes supply and installationof fixed-line telephones providing local, national andinternational long distance voice connectivity andbroadband Internet access through DSL. The business alsoprovides value added services such as intelligent networkPassive Infrastructure ServicesThe undertaking relating to the entire assets and liabilitiesof telecom passive infrastructure was transferred fromBhartiAirtel Limited to BhartiInfratel Limited pursuant toa scheme of arrangement sanctioned by the Honble HighCourt of Delhi. BhartiInfratel provides passiveinfrastructure services on a non-discriminatory basis to alltelecom operators in India. BhartiInfratel deploys, ownsand manages passive infrastructure on an all India basis.The Company has approximately 52,000 towers as onMarch 31, 2008, of which approx 30,000 towers will betransferred to Indus Towers Ltd (a Joint Venture betweenBhartiInfratel, Vodafone and Idea Cellular) for 16 circles.
Telemedia – Airtel Industry % BroadBand - 0.2 4.5 4 Fixed Line 1.2 40 3 Broadband ..HP and Airtel had a deal …As on March 31, 2008, the Company had2,283,328 customers (a growth of 22%), of which 34.8%(~795,000) were subscribing to broadband / internetservices.Broadband subscribers - 4.38 million at the end of June 2008 as compared to 3.87 million at the end of March 2008 (growth rate @ 13.18%)Out of total 4.38 million broadband subscribers, 3.72 million are DSL based; 0.42 million Cable Modem; 0.11 million Ethernet LAN; 0.045 million Fiber; 0.057 million Radio, Leased Line 0.018 million and 0.005 million use other technologies.The key financial results of the Long Distance Servicesdivision for the year ended March 31,2008 are presentedbelow. About 25% growth ..Enterprise Services – Corporates--- 49% growth ….
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