The document provides an overview of the global and national telecom industry and market scenario in India. It analyzes the political, economic, social, and technological factors affecting the industry. It discusses key competitors in India and their respective market shares. Rural and urban demographic characteristics are examined. Finally, it performs a Porter's 5 forces analysis and BCG matrix analysis to evaluate opportunities and threats for a new proposed telecom company called G-Next Telecom.

1. Where Do You Want to Go Today ; Your Potential Our Passion
BUSINESS PLAN FOR NEW TELECOME COMPANY
G-NEXT TELECOM
SERVICES
Jonty Mohta

2. Industrial Scenario - Global
2
 Generate – USD 1.4 trillion (Year 2009) – Recession times
 Asia – Pacific Region : expecting highest growth in next 5 years.
 16% - India & China
 Latin America & Caribbean – 12%
 China (largest telecom operator) – 50% to rural areas
 Asia – booming market
 Japan 3rd largest – 30 million broadband users after US & China.
6 October 2012

3. Mobile Subscriber Base (% Share Of World)
3
Source: EIU (Economist Intelligence Unit)
6 October 2012

4. National Scenario
4
 Emerged – largest & fastest economy
 Recession – but growth in economy
 Service Sector – primary engine growth
 Telecom Sector – significant contribution Private players
 Indian Mobile Market – attractive across the globe
 Internet/Broadband subscribers - 14.05m internet subscribers & 6.62m
broadband subscribers (Jan 2010)
 Advanced Technologies – GSM, CDMA, WLL, 3G , 4G and upcoming 5G
Source: EIU (Economist Intelligence Unit)
6 October 2012

5. Market Scenario
5
 Adding 8-10 million subscribers every month
 Potential of 700 million subscribers in next 5 years.
 Mobile subscribers – 350 million, 2nd only to China.
 MVAS accounts for 10% of the total revenue.
 Stanford University Study – MVAS touch US $ 2.74 billion by 2011.
 Tata Teleservices – invest an additional US $ 1 billion in TATA DoCoMo
 BSNL – will put US $ 1.16 billion in WiMax Project
 Vodafone Essar – invest US $ 6 billion next 3 years to increase mobile subscriber
base
 Bharti Airtel – US $ 126.5 million to strengthen Assam & Northeast Circles.
6 October 2012

6. Contd…
6
 Contribution of nearly 1.2% to India’s GDP
 world’s fastest growing telecom industry
 706.37 million subscribers (landline & mobile )
 World’s 2nd largest network after China
 Upcoming services like 3G and Portability will help to further increase the
growth rate.
Source: EIU (Economist Intelligence Unit)
6 October 2012

7. Why Telecom industry???
7
STATE Subscriber base Population Mobile phase /1000
Uttar Pradesh 85,185,307 199,415,942 427
Maharashtra 78,020,851 110,351,688 707
Tamil Nadu 59,709,707 67,773,611 881
Andhra Pradesh 50,507,427 84,241,069 579
West Bengal 47,088,259 90,524,849 520
Bihar 41,898,468 97,560,027 430
Karnataka 41,804,172 58,969,294 709
Gujarat 36,097,163 58,388,625 618
Rajasthan 36,083,720 67,449,102 535
Madhya Pradesh 35,391,441 72,362,313 489
6 October 2012
Total 652,786,515 907,036,520 589.5

8. Value Added Services in India
8
Person-to-Person SMS
4%
10%
Ringtone Download
17% 44%
Person to Application &
Application to Person
SMS
Games & Data
25%
Others (MMS, etc. )
6 October 2012 Source: TRAI

9. Contd…
9
 As per COAI,
 SMS 44%
 Caller line identification 6%
 Other VAS 19%
 Ring tones 7%
 Content download 6%
 GPRS 5%
 VAS supplied by mobile network operators or VASP
 Many national and international investors ready to invest in this segment of
telecom market.
6 October 2012

10. Future Trends
10
 Location based services
 Mobile music will increase with better bandwidth
 Migration to 3G will increase ARPU
 Mobile commerce might be developed further
 Mobile email will be driven by enterprises
 Stocks on mobile will see an uptake
 Upcoming services like 3G and Portability will help to further increase the
growth rate.
6 October 2012

11. Future trends
11
 Convergence of technologies & the ability of private players to offer it to
the market faster than the incumbent operator.
 “The telecom industry in 2012 will be very different from the one we know
today. Developing strong partnership skills, focusing on customer user
groups, embracing Internet services and starting to talk the language of
Web 2.0 will enable the carriers to thrive well into the future,"
6 October 2012

12. 12
ENVIRONMENT
SCANNING
•Political and Legal factor
•Economical factor
•Social factor
•Technological factor
•Cultural factor
6 October 2012

13. Political / legal factor (1/2)
13
Governmental and legal issues affecting how the company operates
1. The communication Act
(DOT, TRAI and other telecom authority of India)
2. Environmental protection legislation
3. Internet and connectivity Regulation
4. Concern over radiation over mobile phone
5. Spectrum laws
6. Corruption
7. Infrastructure
8. Banning of phone use in certain circumstances
9. Legislative Structures 6 October 2012
(FDI, FII, Mergers & Acquisition, Partnership)

14. Political / legal factor (2/2)
14
10. Monopoly Restriction:
11. Industry regulation and change in regulation
12. Employment and wages legislation and change in that
13. Resourcing and Outsourcing
14. Trade Union power
15. Taxation policies and change in policies
16. R&D restrictions
17. Health issues
6 October 2012

15. Economical factor
15
Factors affecting the purchasing power of the customers and the company’s cost of
capital
1. Average GDP growth (7.9% from 2002 to 2009-10)
2. Per capita income is increases (PPP)
3. Falling handset price
4. Falling tariff
5. Spectrum prices
6. Unemployment level
7. Business cycle (Crisis and Stagflation)
8. Price or cost and Availability of products and row material or services
9. Energy cost or License cost
6 October 2012

16. Social Factor
16
Demographic and cultural aspects of environment which influence customer need and
market size
1. Attitude (Internet @ home)
2. Life style
3. Changes in market trends and customer preferences
4. Urbanization
6 October 2012

17. DEMOGRAPHIC FACTOR
17
 Age
 Income Level
 Occupation
 Literate Rate (65%)
6 October 2012

18. Technological Factor
18
1. R & D Expenditure and New equipments for R & D
2. Infrastructure Expenses
3. Skilled Employees
4. 3G or 4G Instruments
5. Universal Mobile Télécommunications System (UMTS)
6. GPRS , SMS and MMS technologies
6 October 2012

19. 19 COMPETITIVE ANALYSIS
BHARTI AIRTEL
RELIANCE
VODAFONE
IDEA
BSNL
MTNL
UNINOR
TATA
AIRCEL
6 October 2012

20.  Competitors in Market
20 6 October 2012

21. Market Share Of Wireless
Service Operators In India
21 (DEC 2009)
1%
1% Bharti
5% Reliance
11% 23% Vodafone
BSNL
9% Tata
Idea
Aircel
13% 19%
MTNL
Others
18%
6 October 2012 Source: TRAI

22. Market Share Of Network
22
Provider
GSM MARKET SHARE
1% 1%
8%
Bharti
7%
31% Vodafone
BSNL
Idea
14% Aircel
Reliance
MTNL
BPL
15%
23%
6 October 2012 Source: TRAI

23. Competitive analysis
23
Name Subscription base
BHARTI AIRTEL 139,220,882
Reliance 113,315,831
Vodafone 111,465,260
Idea 70,748.936
BSNL 73,781,448
AIRCEL 43,296,659
Uninor 5,582,683
Sistema 6,873,798
MTNL 5,255,444
TATA 74,850,220 6 October 2012

24. 24 CONSUMER ANALYSIS
RURAL
URBAN
INCOME LEVEL
6 October 2012

25. Demographic characteristic
25
 Total Tele-density stood at 39.86 per cent
 Wire line Tele-density came in at mere 3.22 % whereas wireless
subscription contributed 91.9 % of overall Tele-density
 Subscription in Urban Areas was at 328.55 Million and Rural
subscribers increased to 136.27 Million
 According to the Vision 2020 document of the Planning Commission of
India, the country will witness continued urbanization. The urban
population is expected to rise from 28 per cent to 40 per cent of total
population by 2020
 Future growth is likely to be concentrated in and around 60 to 70
large cities having a population of one million or more
6 October 2012

26. Market Share – Rural &
26
Urban
Rural Urban
73% 71.60% 70.70%
74.80% 74.40%
27% 28.40% 29.30%
25.20% 25.60%
Jun-08 Sep-08 Dec-08 Mar-09 Jun-09
6 October 2012 Source: TRAI

27. 27
Strength
1) Technically educated and intelligent work force, if given proper benefits and services can
be retained in India.
2) Utility and necessity of telecom services increasing day by day. High rate of Growth in
industry.
3) More and more value added services, along with the main services are provided.
4) Revenue sharing, strategies are leading to Mergers and acquisition, helping companies to
enter new business opportunity and generate employment boosting country's economy.
5) Telecom software, telecom professionals, telecom infrastructures and telecom services are
the key player in shaping today's economy.
6 October 2012

28. Weakness
28
 Bureaucracy and politics effect the business
policy
 Slow reform process effect the changes and
make the progress slow.
 High initial investment
 Intangibility of services high so difficult to
pursue the consumer
6 October 2012

29. Opportunity
29
 Telecom education institutes are coming up to keep the professionals at par
with the changing technology
 Cost effectiveness and govt. support could also be exploited as an
opportunity
 New opportunities are generating more employment and creating a
knowledge based economy
 Building of services has lot of potential in today's market.
 Increase ability of bandwidth has open door to new schemes, making
efficient uses, providing value added services and generating more profits.
 An expanding Indian economy with increase focus on the service sector.
6 October 2012

30. Threats
30
 Regulatory changes are constant threat
 Cheaper landline services
 High and tough competition in market
6 October 2012

31. 31 Porter’s 5 forces
6 October 2012

32. 32
TELECOMMUNICATION
INDUSTRY
6 October 2012

33. THREAT OF NEW ENTRANTS THREAT OF SUBSTITUTES
• Ownership of a telecom license • Already existing Video calling and Internet
facilities
• Finance
POWER OF SUPPLIERS POWER OF BUYERS
• Less power • Increased choice – high bargaining power
• Talented managers & engineers • Switching costs – individual & large business
customers.
RIVARLY AMONG EXISTING FIRMS WITHIN AN INDUSTRY
• Usage of phone, competition is high
• Price
• Value added services
• Profitability low
6 October 2012
33

34. GAP
34
 The largely untapped rural market will
drive the next phase of telecom growth
in the country, supported an by enabling
environment and focused initiative by
company.
 Army/ airforce and BSF as well as senior
citizen are untapped till the day.
6 October 2012

35. 35 BCG MATRIX
6 October 2012

36. 36
6 October 2012

37. 37
BHARTI AIRTEL STAR High Growth, high Market
share
Reliance Cash Cows High market share, low Growth
Vodafone STAR High Growth, high Market share
Idea Question Mark High Growth, Low market share
BSNL Question Mark High Growth, Low market share
TATA Question Mark High Growth, Low market share
Virgin Dogs Low Growth, Low market Share
Uninor Dogs Low Growth, Low market Share
6 October 2012

38. ANALYSIS FROM BCG MATRIX
38
• Untapped Broadband services
• 41% (Approx) market is untapped
 Question Mark ?
6 October 2012

39. 39
STRENGTHS WEAKNESSES
• Targeting Rural population as well as Senior • They did not have their own towers.
citizen and BSF/Army Jawans. • New market so they may fail to identify consumer
• Strong network across the nation taste and preferences.
• Large Capital availability • Less or no profitability at initial stage
• Strong Infrastructure
OPPORTUNITIES THREATS
• To tie up with dell, Lenovo and Micromax • Presence of strong competitors like Vodafone,
• Tie up with other companies to set independent Airtel and Docomo .
tower company like “Indus Tower”
• Expanding business in rural area and national • Vodafone and Airtel’s acceptance is increasing
borders. • Reliance is biggest threat in CDMA.
• Untapped Broadband services • New entry of foreign companies.
• We are targeting senior citizens • Trade union
• 41% (Approx) market is untapped
• Listing on stock market
6 October 2012
• Marketing innovations

40. 40 STP ANALYSIS
•Segmentation
•Targeting
•Positioning
6 October 2012

41. Segmentation
41
Segmentation :
income
 Age
 Service usage
 Life of service
 Geographical condition
 Nature of customer
 Institutional
 Sole
6 October 2012

42. Targeting
42
 Multi segment approach – a series of differentiated product to their
respective market
 Targeting Rural India by giving them CDMA special Plan
 Home calling cards to national and International consumers
 Special senior citizen cards
 BBM and SMS services for young generations
 Facility of Group calling and SMS for targeting young people
 Special Air force and BSF cards
 Corporate net and mobile plans as well as wifi plans for corporates
6 October 2012

43. Positioning
43
 Psychology
 Emotional aspects - Actor like “Amitabh Bachan” will be retained for
Brand positioning.
 Product benefit - We are talking about exclusivity of network.
 Distribution Channel
 “Where Do You Want to Go Today ; Your Potential Our Passion”
6 October 2012

44. 44 Competitive Advantage
6 October 2012

45. Competitive Advantage (Target
Audience)
45
 Senior Citizen Plan
 Military and BSF Plan
 BBM Plan with 1 month free on annual subscription
6 October 2012

46. Porter’s generic strategy
46
1. Overall Cost leadership strategy
2. Differentiation strategy
3. Focus strategy
6 October 2012

47. 1. Overall cost leadership strategy
47
 The Overall Cost leadership strategy is aimed at gaining a competitive advantage through
lower costs.
 The low cost leader in any market gains competitive advantage from being able to many
to produce at the lowest cost. Factories are built and maintained; labor is recruited and
trained to deliver the lowest possible costs of production. 'cost advantage' is the focus.
 Financial considerations and budgetary constraints play a critical role here in shaping
competitive price of the products.
 Besides the production efficiency, brand and marketing skills plays a important role in this
kind of competition.
 For example:--Some organizations, such as Toyota, are very good not only at
producing high quality autos at a low price, but have the brand and marketing skills to
use a premium pricing policy.
6 October 2012

48. 2.Differentiation strategy
48
 A firm with a differentiation strategy attempts to achieve a competitive advantage by
creating a product or service that is perceived as unique.
 Differentiated goods and services satisfy the needs of customers through a
sustainable competitive advantage. This allows companies to desensitize prices and
focus on value that generates a comparatively higher price and a better margin.
 The benefits of differentiation require producers to segment markets in order to
target goods and services at specific segments, generating a higher than average
price.
 For example, British Airways differentiates its service by providing focus
on exceptional good quality of service rather than focusing on low price.
6 October 2012

49. Contd…
49
 The differentiating organization will incur additional costs in creating their
competitive advantage. These costs must be offset by the increase in
revenue generated by sales.
 There is also the chance that any differentiation could be copied by
competitors. Therefore there is always an incentive to innovated and
continuously improve
6 October 2012

50. 3. Focus or niche strategy
50
 The focus strategy is also known as a 'niche' strategy. Where an organization can afford
neither a wide scope cost neither leadership nor a wide scope differentiation strategy, a
niche strategy could be more suitable.
 Here an organization focuses effort and resources on a narrow, defined segment of a
market.
 Competitive advantage is generated specifically for the niche.
 A niche strategy is often used by smaller firms. A company could use either a cost focus or
a differentiation focus.- With a cost focus a firm aims at being the lowest cost producer in
that niche or segment.
 With a differentiation focus a firm creates competitive advantage through differentiation
within the niche or segment.
 There are potentially problems with the niche approach. Small, specialist niches could
disappear in the long term. Cost focus is unachievable with an industry depending upon
economies of scale e.g. telecommunications. 6 October 2012

51. 51 4 P’s
Product
Price
Place
Promotion
6 October 2012

52. Product
52
 Prepaid
 Postpaid
 I-Phone 3G
 CDMA Handset
 World Calling Cards / National Calling cards
 Gulf Calling Cards
 BSF and ARMY cards
 Senior citizen plans
6 October 2012

53. Product
53
 A product with many different features provides customers with opportunities to
 Chat,
 Play games,
 Send and receive pictures and Videos
 Change ring tones,
 Receive information about travel and sporting events,
 Obtain billing information
And soon view video clips and send video messages.
 Also provides on-the-move information services.
6 October 2012

54. PRICING STRATEGY
54
6 October 2012

55. Price
55
 Monthly price plans as well as pre pay options
 Actual plan for prepaid holders
 CDMA plan
 1Rs./5 min - Local and 3 Rs./8min National
 Caller tune and SMS is free for 1st month
 Postpaid – Rs.500 talk time -12th month
 Discounts and Free talk time on weekends
 Free voicemail services for 1st two months
 Different GSM plans
6 October 2012

56. WEEKEND PRICING
56
Brand
Loyalty
Promoti
onal
schemes
Discoun
ts e.g. Wal mart
6 October 2012

57. Place Manufacturer
57
 Depending on TRAI and DOT
 Launching – Rural area , Metro and mega City Distributor
Associated
Distributor
Retailer
Consumer
6 October 2012

58. Promotion
58
 Advertisement
 Free sample
 Sponsorships – Events.
 Sales Promo, Internet Marketing, Mobile marketing
 Water tank drums and sheets
 Rural helpline with IFFCO to answer farmer’s various crop related queries.
STRONG
TV RADIO
BRAND
6 October 2012

59. PRICING & BRANDING STRATEGY
59
BRAND
STRATEGY
Pricing
Marketing
Campaign
Sales &
Corporate
Websites Literature Messaging Naming CRM
Identity
tools
6 October 2012

60. 60
 USP of the Company/Product/Person which makes “Value
Selling Proposition”.
 U & Me are also brands.
 B – Base
 R – Reputation
 A – Achievement
 N – Noticeable
 D – Dividends
6 October 2012

61. PRICING & CHANNEL
61
STRATEYGY
6 October 2012

62. Marketing strategy
62
 Our strategic objective is
- Innovate and deliver on customer’s total
communications needs.
 We need to educate the consumer
 Does your mobile give you information about Crops?
“Where Do You Want to Go Today ; Your Potential Our Passion”
6 October 2012

63. Commercial strategy
63
 Branding
-Stores
-Mass media coverage
 Innovative distribution to reach the customer
-Exclusive shops
-Hub and spoke
-Associate distributions
 Customer service
-Shops and call centers
-Vans
-Help desks 6 October 2012

64. SETTING VALUE PRICE
64
USP/Differentiated product
Delivery & Design
Product Costs
Product Price
6 October 2012

65. 65 Distribution Strategy
6 October 2012

66. SERVQUAL Model
66
6 October 2012

67. CHANNEL STRATEGIES
67
Manufacturer • Direct Channel
• Indirect Channel
DISTRIBUTOR • Hybrid Approach
• Push & Pull Strategy
ASSOCIATED
DISTRIBUTORS
Retailer
Customer
6 October 2012

68. PUSH & PULL STRATEGY
68
Manufac Manufacturer
turer
Distributor
Consumer Distributor
Associated Distributor
Associated
Retailer Distributor Retailer
Consumer
6 October 2012

69. 69
I am waiting for the mobile which allows us
to speak
when we are flying high in the sky!!!
We have seen the revolution till 5g
technology now lets see
if 6g technology comes and we can talk in
air……..
6 October 2012