Research Report by Shailesh KR Singh (Sc-2) Ss 2009-11

Research Report
On
“Comparative Analysis Of Telecom Industries In
Lucknow With Reference To BSNL”
Submitted For The Partial Fulfillment Of The Degree Of

Masters Of Business Administration
(2009-11)
SUBMITTED BY
Shailesh Kumar Singh
Section: Sc-2
(SS-2009-2011)
INDIAN INSTITUTE OF PLANNING AND MANAGEMENT

NEW DELHI
PGP/IIPM/SS 2009-11/SC 2 Page 1

ACKNOWLEDGEMENT
It was a great feeling and good experience to work on this research report.
Through this project I would like to acknowledge all those people who have
supported me all throughout in the completion of my project.
I give my special regards to Mr. S.S.Chauhan (Director) for guiding me in the

completion of my research report.
I am highly obliged and deeply thankful to our faculty members for their
efforts and constant support in providing valuable information and formulating
my research report. My humble gratitude also for the employee of organization,
who helped me by giving me their valuable suggestions.
I will be failing in my duty if I do not express my gratitude to my family and

friends for their continuous co-operation and encouragement.

PREFACE
This project is the outcome of my study on “Comparative analysis of telecom
market in Lucknow city”
Indian Telecom sector, like any other industrial sector in the country, has gone
through many phases of growth and diversification. Starting from telegraphic and
telephonic systems in the 19th century, the field of telephonic communication
has now expanded to make use of advanced technologies like GSM, CDMA, and
WLL to the great 3G Technology in mobile phones. Day by day, both the Public
Players and the Private Players are putting in their resources and efforts to
improve the telecommunication technology so as to give the maximum to their
customers.
In this research I will try to find out that which telecom brand is providing
better satisfaction to customers and dealers and also try to find out the entire
problem faced by customer’s point of view. Introduce people about the some
latest function and study on phone connection. My objective is to give
information about mobile connection, so that they can easily identify their mobile
connection without any problems. This report is also helpful for telecom industry
so they can understand customer’s need and requirement.

CONTENTS
 Industry profile
 Introduction
 Company profile
 BSNL Services
 Purpose of study
 Research methodology
 Classification of Telecom Industry
 Data tabulations, interpretations and findings
 Conclusion
 Recommendation
 Bibliography
 Questionnaire

INDUSTRY PROFILE
Indian Telecommunication story: From 10 million to 150 million mobile
subscribers in 5 years. , that’s true. Indian telecommunication Industry is one of
the fastest growing telecom markets in the world. The mobile sector has grown
from around 10 million subscribers in 2005 to reach 150 million by early 2008
registering an average growth of over 90%. The two major reasons that have
fuelled this growth are low tariffs coupled with falling handset prices.
Surprisingly, CDMA market has increased its market share up to 30% thanks to
Reliance Communication. However, across the globe, CDMA has
been losing out numbers to popular GSM technology, contrary to
the scenario in India.
The other reason that has tremendously helped the telecom
Industry is the regulatory changes and reforms that have been
pushed for last 10 years by successive Indian governments.
According to Telecom Regulatory Authority of India (TRAI) the rate of market
expansion would increase with further regulatory and structural reforms.
Even though the fixed line market share has been dropping consistently, the
overall (fixed and mobile) subscribers have risen to more than 200 million by first
quarter of 2009. The telecom reforms have allowed the foreign
telecommunication companies to enter Indian market which has still got huge
potential. International telecom companies like Vodafone have
made entry into Indian market in a big way.
Currently the Indian Telecommunication market is valued at
around $100 billion (Rupees 400,000 crore). Two telecom
players dominate this market - Bharti Airtel with 27% market
share and Reliance Communication with 20% along with other
players like BSNL (Bharat Sanchar Nigam Limited) and AT&T.
One segment of the market that has been puzzling is
broadband Internet. Despite the manner in which the country’s
Internet market has been booming, India’s move into high-
speed broadband Internet access has been distinctly slow. And, while there
appears to be considerable enthusiasm amongst the population for the Internet
itself, this has not been reflected in broadband subscription numbers. In 2006
India witnessed a good surge in broadband users with the total subscriber base in
the country expanding by almost 200% to just over 2 million by year’s end.
Despite this surge, broadband penetration in India still remains around only 0.2%;
broadband services still account for only 25% of the total Internet subscriber
base, still in itself comparatively low.
The Ministry of Communications and Information Technology (MCIT) is has very

aggressive plans to increase the pace of growth, targeting 500 million telephone
subscribers by end-2010. Most of the expansion in subscribers is set to occur in
rural India. India’s rural telephone density has been languishing at around 1.9%;
so, if 70% of total population is rural, the scope for growth in this Industry is
unprecedented.
Over the last 3 years, two out of every three new telephone connections were
wireless. Consequently, wireless now accounts for 54.6% of the total telephone
subscriber base, as compared to only 40% in 2003. Wireless subscriber growth is
expected to grow at 2.5 million new subscribers every month in 2007. The
wireless subscriber base skyrocketed from 33.69 million in 2004 to 62.57 million
in FY 2004 -2005. The wireless technologies currently in use ' Indian Telecom
Industry ' are Global System for Mobile Communications (GSM) and Code Division
Multiple Access (CDMA). There are primarily 9 GSM and 5 CDMA operators
providing mobile services in 19 telecommunication circles and 4 metro cities,
covering more than 2000 towns across the country. And the numbers are still
growing for ' Indian Telecom Industry '. ' Telecom Industry in India ' is regulated
by 'Telecom Regulatory Authority of India' (TRAI). It has earned good reputation
for transparency and competence. Three types of players exists in ' Telecom
Industry India ' community -
 State owned companies like - BSNL and MTNL.

 Private Indian owned companies like - Reliance Infocomm and Tata
Teleservices.
 Foreign invested companies like - Hutchison-Essar, Bharti Tele-Ventures,
Escotel, Idea Cellular, BPL Mobile, Spice Communications etc.

INTRODUCTION
Bharat Sanchar Nigam Limited (known as BSNL, India Communications

Corporation Limited) is a state-owned telecommunication company in India.
BSNL is the fourth largest cellular service provider, with over 53.96 million
customers as of March 31, 2009 and the largest land line telephone provider in
India. Its headquarters are at Bharat Sanchar Bhawan, Harish Chandra Mathur
Lane, Jan path, New Delhi. It has the status of Mini Ratna, a status assigned to
reputed public sector companies in India.
BSNL has installed Quality Telecom Network in the country and now focusing on
improving it, expanding the network, introducing new telecom services with ICT
applications in villages and wining customer's confidence. Today, it has about 47.3
million line basic telephone capacity, 4 million WLL capacity, 20.1 Million GSM
Capacity, more than 37382 fixed exchanges, 18000 BTS, 287 Satellite Stations,
480196 km of OFC Cable, 63730 km of Microwave Network connecting 602
Districts, 7330 cities/towns and 5.5 Lakhs villages.
BSNL, a state-owned service provider in India, is the seventh-largest

telecommunication company in the world. It offers a wide range of services in
India, such as wire line, CDMA mobile, GSM mobile, internet, broadband, carrier,
MPLS-VPN, VSAT, VoIP, IN, etc. BSNL is the largest operator in basic services in
India with its cellular services helping it to establish its presence as the largest
operator in rural areas.

COMPANY PROFILE
COMPANY NAME: Bharat Sanchar Nigam Ltd.
Headquarters: Bharat Sanchar Bhawan, Harish Chandra Mathur Lane,

Jan path, New Delhi
Head Office in Lucknow: Hazratganj
Branch office in Lucknow: Sapru marg, Hazratganj, Alambagh,

Mahanagar, Kaiserbagh
Chairman & Managing Director: Kuldeep Goyal
Status: Mini Ratan (a status assigned to reputed public sector companies

in India.)
Founded: 19th century, incorporated 2000
Owner: Government of India
Employees: 357,000 march 31, 2009

SERVICES
BSNL Mobile
Prepaid Mobile
BSNL Broadband
BSNL provides almost every telecom service in India. Following are the main
telecom services provided by BSNL:
Universal Telecom Services : Fixed wire line services & Wireless in Local loop
(WLL) using CDMA Technology called bfone and Tarang respectively. As of
December 31, 2009, BSNL has 81% market share of fixed lines.
Cellular Mobile Telephone Services: BSNL is major provider of Cellular Mobile

Telephone services using GSM platform under the brand name BSNL Mobile. As
of March 31, 2009 BSNL has 17% share of mobile telephony in the country.
Internet: BSNL provides internet services through dial-up connection

(Sancharnet) as Prepaid, (Net One) as Postpaid and ADSL broadband (BSNL
Broadband). BSNL has around 50% market share in broadband in India. BSNL has
planned aggressive rollout in broadband for current financial year.
Intelligent Network (IN): BSNL provides IN services like televoting, toll free
calling, premium calling etc.

BSNL to offer new services
BSNL, India’s third largest mobile operator has awarded the world leading
telecom equipment makers Ericsson and Nokia Siemens Networks an estimated
$4.5 billion to $4.7 billion mutual contract for upgrading its technical services.
Recently, Bharat Sanchar Nigam Limited (BSNL) awarded Nokia Siemens Network
a contract for deploying Broadband access across 7,000 Indian villages in India.
Nokia Siemens Networks’ high speed bandwidth connection shall permit BSNL to
transport high data and triple-play demanding services such as Video on Demand,
Video Multicast, IPTV, Video Conferencing, and VPN to its many customers. This
network will also permit BSNL to provide connectivity to CSCs (Community Service
Centers) and other e-governance locations.
Bharat Sanchar Nigam Limited (BSNL) has also announced its ’TV in mobile
handset’ service in some parts of the country, on the basis of this highly advanced
network provided by Nokia and Siemens. That means, GSM customers of BSNL
will be able to watch 12 television channels on their mobile handsets. These
channels include; NDTV, Aaj Tak, Times Now, CNBC, ETV, TV9, Zoom, and Bindaas
(UTV Channel). By the year end, approximately a total of 32 channels are
expected to be brought under the ’TV in mobile handset’ network. This shall give
a tough competition to other GSM service providers as BSNL shall offer this
service at very competitive rates.
Currently, this service is available on select Nokia handsets only but is to be
extended later to Sony Ericssson and Motorola handsets too.
And as a matter of fact, this is the 2nd rural Broadband access tender awarded to
Nokia Siemens Networks by BSNL. According to the top official of BSNL, the rural
Broadband project would help bridge the digital divide, and connect nearly
20,000 villages in the country.
Apalya Technologies, the company with whom BSNL has entered into a mutually
benefited partnership, will provide content (TV signals) made available on BSNL
GSM handsets. To view TV content on the handsets, BSNL GSM customers will
have to visit mimobi.tv via their phones.

BSNL 3G services
3G is the next generation of mobile communications systems. It enhances the
services such as multimedia, high speed mobile broadband, internet access with
the ability to view video footage on your mobile handset. With a 3G phone and
access to the 3G network you can make video calls, watch live TV, access the high
speed internet, receive emails and download music tracks, as well as the usual
voice call and messaging services found on a mobile phone, like person to person
video, live streaming, downloadable video of entertainment, news, current affairs
and sport content and video messaging
Promotional 3G Offers
50 Minutes free local video call will be allowed to all new 3G prepaid and
postpaid connections activated up to 31.12.2009.
• Customers purchasing 3G Data card from BSNL and activating the same will get
free data usage of 6 GB per month as 1GB day/any time and 5GB night usage for
two months from the date of activation as a promotional offer until further order.
However, for getting validity the customer has to recharge with data recharge
voucher or fixed monthly charges in case of postpaid connection. The free usage
of 6 GB will be added to the free usage available with the data plan. No other
freebies may be allowed for the above data cards.
• Incoming video call facility allowed to 2G customers with 3G enabled handsets

will continue to be allowed until further order.

PURPOSE OF STUDY
The purpose of the project is “TO EVALUATE THE PRESENT
COMPETITIVE SCENARIO OF TELECOM MARKET IN LUCKNOW”
Objectives:
 Analyze service offers function and durability.
 To find out the problems faced by the customers and dealers with telecom.
 Consumer awareness of latest technology and service support in telecom.
 To find out market share of selected telecom brand in Lucknow city.
 To determine the satisfaction level of customers having BSNL connection.

RESEARCH METHODOLOGY
Research methodology is the procedure adopted for conduction the research
study. Research methodology should be carefully planned as accuracy. Reliability
and adequacy of results depend on research methodology followed. It gives the
researchers a guideline by which he can decide which techniques and procedure
will be applicable to a given problem. Moreover it helps in the evaluation of
research by others also. So, for the research to be successful, purposeful and
effective the researcher should plan the research methodology before preceding
the research study. The following should be the aspects, which should be
considered while designing a research methodology.
Research design:
Research design is simply the framework or plan for studies which is used as a
guide in collecting and analyze the data .It is the blue print that is followed in
completing a study. As objective of the research is descriptive in form, the
research design must be made accordingly;
 Formulating objective of the study.

 Deign the method of data collection.
 Selecting the sample size.
 Collection of data.
 Analysis and findings.
 Conclusion and inferences.
 Limitations.
 Suggestion and recommendation.

Type of research:
The type of research is Descriptive Research because it’s not a very new
issue. A lot of work already had been done in this regard.
Data information:
Primary Data
Primary data is data, which is collected initially for the first time. It helps in
the validation of secondary from secondary sources. It is original in nature
and it may include the following methods.
 Through questionnaires:-
Standardized questionnaires were framed out in order to get data
about the telecom and customers. This information filled by users.
 Through personal interaction:-
People disclosed their experience when they were asked to give
suggestion. Also they told about the problems they were facing.
Secondary Data
It is the detail that which are available in the form of facts and figures. The
sources of secondary data are-
 Websites
 Magazines
 Journals
 Books
 Pamphlets
 Newspapers

Research instrument:-
 Questionnaire: Questionnaire includes a set of questions, which are related
to study objective, and from which it helps in analyzing the result can be
inferred easily.
 Analysis: Analysis of data is done through a process which includes certain
steps follows:-
1. Editing
2. Coding
3. Classification
4. Tabulation
Finally the data and inferences can be represented well with the help of pi-chart.
Sample plan:
 Type of universe: the type of universe selected in sample design is finite.
 Sample unit: sampling unit in the research project is network customers

and dealers.
 Sample size: the optimum sample size taken in this project is that of 100
people which was enough to depict representative-ness reliability and
efficiency.
 Sample area: Lucknow city
 Sampling: I will prefer random sampling because the customers and dealers
are found everywhere.

Scheduling:
 Specify the information required in five days.
 Developing a research instrument in seven days.
 Gathering the information in five days.
 Analyzing and interpreting it in terms of problem being tackled in seven

days.
 Summarizing the finding in five days.
 Preparing the research report in seven days.
Total research report completed in thirty -six days.

CLASSIFICATION OF INDIAN
TELECOM INDUSTRY
The Indian telecom sector can be broadly classified into fixed line
telephony and mobile telephony. The major players of the telecom sector
are experiencing a fierce competition in both the segments. The major
players like BSNL, MTNL, VSNL in the fixed line and Airtel, Hutch, Idea,
Tata, Reliance in the mobile segment are coming up with new tariffs and
discount schemes to gain the competitive advantage
Fixed-line Telephony
 Public Players
o Subscribers
 Private Players
o Subscribers
Mobile Telephony
 Public Players
o Subscribers
 Private Players
o Subscribers
FIXED LINE TELEPHONY

Fixed line telephony can be further categorized as fixed wire-line
telephony and fixed wireless telephony (known as WLL (F)). Fixed line
telephony provides services such as local calls and long distance calls–
national and international. The Government of India is now taking actions
to convert all national long distance calls to local calls. In this regard,
public players have already started their 1Rs. Call service. In India at
present, fixed line telephone numbers are of 11 digits, (initially 8 and 10
digits).

Both public players and private players are competing hard to capture
more and more market share. MTNL and BSNL are the leading public
sector players, whereas Reliance Info-com, Tata Tele-services and
Touchtel are the leading private sector players.
Market shares of public and private players
The year 2009 has observed a steep fall of Fixed line connections by 0.16
million, pulling down the overall increase in telephone connections to
9.06 million in June 2009, according to the data released by telecom
regulatory TRAI. But in 2005-06, fixed line telephony segment in Indian
telecom sector witnessed a growth of 8.64%. The total subscriber base of
fixed lines including WLL (F) touched the fig of 50.2 M and was showing an
upward trend.

MOBILE TELEPHONY
Mobile telephony was introduced in Indian markets in mid- 1990s. In the last few
years, the sector has witnessed tremendous growth. The subscriber base is
adding more and more customers every year. Mobile telephony recorded more
than 296 million users in June 2009, exceeding fixed line telephone subscriber
base. Also, mobile segment has welcomed more and more players every year.
Liberalized policies have ensured lower tariffs and reduced roaming rentals. This
will lead to increased usage of mobile phones.
Mobile telephony can be further categorized into WLL, CDMA and GSM. The
much-awaited 3G mobile technology is going to enter soon in Indian telecom
sector.
Mobile telephony provides services such as messaging– text and multimedia–

mobile commerce through GPRS enabled mobile Internet, with local calls and
long distance calls– national and international.
Not only service providers but also equipment manufacturers are contributing
towards the growth of the sector. Mobile telephony started up with bulky
handsets and has now reached to smart phones with cameras, radio facility and
lots of other multimedia applications. Also, PDAs have entered Indian markets
with operating systems that make it a pocket PC.
Both public players and private players are competing hard to capture more and
more market share. Leaders in fixed line telephony have now started providing
mobile services, such as MTNL’s Garuda and Dolphin. Private players capture
most of the market share in Indian mobile segment.

MARKET SHARES OF PRIVATE PLAYERS AND PUBLIC PLAYERS IN MOBILE
TELEPHONY
SEGMENTAL PERFORMANCE
TELEPHONE SEGMENT
Mobile Services
Wireless subscriber base in the country is witnessing strong growth and it is one
of the major driving forces in telecom industry. Wireless segment has added
95.96m subscribers in FY08. Bharti Airtel added maximum number of subscribers -
24.84m followed by Reliance with 17.78m, Vodafone 17.69m, Idea 9.99m, BSNL
9.89, Tata Tele 8.31m and six other small players together added another 7.55m
in FY08.

GSM
The GSM subscriber base reached 192.70 million in the quarter ending March 2009,
as against 172.23 million at the end of the previous quarter. The growth for this
quarter is 11.89% as compared to previous OND07 quarter. Bharti, with 61.98
million subscriber base, remains the largest GSM mobile operator followed by
Vodafone with 44.13m, BSNL with 36.21m and Idea with 24.00m.
CDMA
The CDMA Subscriber Base reached 68.37 million during the quarter ending
March 2009 as against 61.39 million at the end of December 2008. The quarterly
growth in JFM08 is 11.37% as against 11.44% the previous quarter. Reliance
remains the largest CDMA mobile operator followed by Tata Teleservices and
BSNL with subscriber base of 38.78m, 24.33m and 4.58m respectively. BSNL in
Kolkata & Punjab reported negative growth.

Wire Line
The total subscriber base of Wire line services stood at 39.42 million as on 31 st
March 2009. The incumbents BSNL and MTNL have 80.05% and 9.33% market
share respectively in the subscriber base, while all the five private operators
together have 10.62% share. Wire line subscriber base has been declining in the
last few years. Subscriber base for some of the companies like Bharti, Tata (Tele &
Communications), MTNL and Reliance increased marginally. On the other hand,
BSNL, Shyam and Telelinks have lost marginal subscriber base in JFM09, as
Compared to the previous quarter.

Broadband is slowly closing down the gap sidelining the dial-up to
access the Internet in India.
As per a new study by TRAI (Telecom Regulatory Authority of India),

percentage of dialup subscribers declined to 66 % in March 2008 from
84 % year-on-year & came down to 60 % in June 2008.
India had around 7.7 million Internet subscribers by June 2008.

Around 20 % of those were using broadband to access the Internet, but
the segment is witnessing a fast growth rate boosted by cheap tariffs
and easy & economic installation options as most broadband
connections in India are DSL (digital subscriber lines) connections,
provided as an add-on over existing fixed line connections, thereby
reducing installing costs.
In order to attract more customers, operators are offering exciting

packages while some are even providing installations at zero or very
low cost.
As per RNCOS report "Indian Telecom Sector Analysis (2007-2008)",

"The Internet Access Market in India is all set to grow twice the
existing value, with the increase in de-regularization, literacy level,
increasing consumer awareness, PC penetration etc. Broadband
Wireless Market in India is all set to take off in a big way. Over 70%
of the households in India have no access to wired lines and the
number of mobile phone users far outnumbers PC owners. Such a
scenario presents a very good opportunity for Wireless Broadband
Services."
Among the major hindrances in the Indian broadband sector is the

speed at which broadband is provided. Though the tariffs have reduced
significantly, the speed of the connection is still insufficient to justify

its price. Moreover, improper & false billing and slower connection
speeds (than specified by the ISP) are the key challenges for the sector.
A cost-effective & scalable technology like WiMAX is needed to

achieve these set targets. WiMAX has the potential to offer a perfect
solution with long-range, wireless & scalable broadband solutions,
which can be quite successful in Indian market.
Market Share Of Different Companies:

The Cellular Operators Association of India
(COAI):
The Cellular Operators Association of India (COAI) was constituted in
1995 as a registered, non-profit, non-governmental society dedicated to
the advancement of communication, particularly modern
communication through Cellular Mobile Telephone Services.
With a vision to establish and sustain a world-class cellular

infrastructure and facilitate affordable mobile communication services
in India, COAI’ main objectives are to protect the common &
collective interests of its members. Keeping the mandate given to it,
COAI is the official voice for the Indian Cellular industry and on its
behalf it interacts with:
The policy maker, the licensor, the regulator, the spectrum

management agency, the industry (telecom /non-telecom) associations

FUTURE ISSUES AND CHALLENGES
Going by the number of mobile phone subscribers, India has become the world’s
fastest growing region. With almost 5-6m subscribers added every month, the
country is witnessing exciting times in the telecom industry. This growth has
outpaced predictions of reaching 100m by 2007 and 200m by 2010. Now the
estimate is 500m subscribers by 2010. The mobile population is expected to over
between 325m to 350m by end of 2008.
Additional spectrum to service providers

India is on the brink of full-fledged rollout of 3G and WiMAX services across the
country. The regulators and the government are in deep discussions on spectrum
allocations. It’s decided to have Additional spectrum to be allocated to service
providers, based on their existing subscriber base. This will provide the
foundation for next generation mobile services in the country. However, as TRAI
proposing to hike spectrum charges from 4% to 5% of the revenues generated by
the service providers, mobile operators may have to shell out a higher percentage
of their annual revenues towards spectrum charges.
Service providers need to improve rural penetration

Out of the total population of about 1.136 billion in India, only about 28% live in
urban areas and the rest 72% live in rural areas. But however, only about 2%
(16m) of the rural population has access to mobile phones. It is a high time for the
companies to invest in these rural areas, too. Driven by a significant addition in
rural telephony, overall population coverage in the country is expected to
increase from 65% to 80%.
CONTINUOUS FALL IN ARPU AND IN RPM
Industry-wide ARPUs and Revenues per Minute (RPMs) have been on a downward
trail over the past several years now. This has been on account of a greater
number of 'lower-end' subscribers getting added to the network. It may be noted
that over 50% of the incremental users added to market leader, Bharti Airtel's
network in 1QFY2009 were rural. Most of these users would never have used a
mobile phone before and would thus take time to understand its features and
functionality. Consequently, this leads to these users taking some time before
ramping up usage patterns and revenues for operators. Further, competitive
intensity in the sector is arguably the highest in the world leading to a consistent
fall in realizations. Scale benefits with the increasing size of mobile operators have
also enabled them to cut costs to drive greater usage and add more subscribers to
their networks. With regulatory costs such as access deficit charge (ADC) also
having been cut to NIL in FY2009, operators have passed on the benefits of these
cuts to users, thus again fueling growth in minutes of usage (MoUs). Industry
ARPUs have fallen at a CAGR of around 10% over FY2005-08 from Rs378 per user
per month to Rs275 (Source: CRIS INFAC). We estimate industry ARPUs to fall
from Rs275 in FY2008 to Rs238 in FY2011E, a CAGR decline of 4.7%. Thus, we
estimate overall industry revenues to grow from Rs68, 896cr (US $17.2bn) in
FY2008 to Rs1, 42,761cr (US $34bn, assuming a Rupee rate of 42 to a Dollar) in
FY2011E, a CAGR growth of 27.5% over the period, led by strong subscriber
accretion.
Mobile commerce to become the next big thing

Mobile commerce is expected to penetrate further. The urban customers will of
course be introduced to new services in this area. But its impact will be felt most
distinctly in the rural areas, where it will help strengthen the rural microfinance
projects. Money transfer over the mobile and m-commerce are tipped to be the
next best thing to happen after SMS and Hello Tunes. This would enable millions
of Indians working abroad to easily transfer money to their families back in India
via their mobile phones.

COMPETITORS OF BSNL:
• -Private Indian owned companies (Reliance Infocomm, Tata Teleservices,)
• -Foreign invested companies (Vodafone, Bharti Airtel, Idea Cellular)
LEADING COMPETITORS OF BSNL
 Vodafone
 Bharti Airtel
 Reliance Infocomm
 Idea Cellular
COMPETITIVE STRATEGY OF DIFFERENT MARKET PLAYERS IN

THE INDUSTRY
BHARTI AIRTEL
Bharti Airtel, a part of Bharti Enterprise, is India’s first and largest private service
provider with a nation-wide operational presence. While it was founded in 1995
as Bharti Televenture Ltd. (BTVL), in April 2006, the company changed its name to
Bharti Airtel. Today, it is one of the fastest growing telecom companies in the
world with 71,777,448 customers as on June 30, 2008, consisting of 69,383,716
GSM mobile and 2,393,732 Bharti Tele-media subscribers.
The company has structured its business in three segments – mobile services,
broadband and telephone services, and enterprise services. The mobile services
group provides GSM mobile services across India in 23 telecom circles, while the
ATS business group provides broadband & telephone services in 94 cities. The
enterprise services group has two sub-units - carriers (long distance services) and
services to corporate. All these services are provided under the Airtel brand.
Company shares are listed on The Stock Exchange, Mumbai (BSE) and The
National Stock Exchange of India Limited (NSE).

Business Strategies
Business Alliances
In order to improve cost and quality, the company outsources non-core activities
through business alliances. These alliances provide access to new technologies
and allow the company to adopt the best practices of enhancing customer
experience. In fact, Airtel has established alliances with Sing Tel, Ericsson, Nokia,
Siemens, Nortel, Corning, IBM, Hinduja TMT, TeleTech and MphasiS.
Unified Brand Strategy

Bharti has decided to use Airtel as the single brand name across all its categories
such as cellular, fixed and internet services. The company believes that an
integrated approach such as One Airtel will help it in better addressing customer
needs through bundled service offerings. This initiative is slated to increase
Airtel’s ROI.
Bharti Airtel entered into a comprehensive 10-year agreement with IBM to
transform its processes and take on the management of its IT infrastructure.
Bharti Airtel saw the flexibility of IBM’s integration approach–and recognized

the application of IBM’s extensive portfolio of middleware products and
expertise in service-oriented architecture (SOA)–as an ideal match for its
integration requirements. Dr. Jai Menon, Group CIO, Bharti Enterprises and
Director (IT & Innovation), Bharti Airtel, was a key architect of the plan. “Our
new strategy is all about delivering a truly differentiated experience, and having
the flexibility to continually improve the customer experience,” says Menon

BHARAT SANCHAR NIGAM LTD.
BSNL, a state-owned service provider in India, is the seventh-largest
telecommunication company in the world. It offers a wide range of services in
India, such as wire line, CDMA mobile, GSM mobile, internet, broadband, carrier,
MPLS-VPN, VSAT, VoIP, IN, etc. BSNL is the largest operator in basic services in
India with its cellular services helping it to establish its presence as the largest
operator in rural areas.
Business Strategies
Rural Penetration
BSNL is playing a leadership role in developing the telecom infrastructure in rural
areas. It has been successful in increasing its cellular subscriber base by
pioneering its services in the rural terrain. Its services cover the whole of India,
except Delhi and Mumbai, which are covered by MTNL, the other state-owned
player.
Low Cost Strategy

BSNL is a low-cost service provider of many services. This strategy has helped
BSNL in penetrating the market.

RELIANCE COMMUNICATIONS
Reliance Communications, previously known as Reliance Infocom, brought about
a digital revolution in the Indian telecom industry by providing India’s vast
population with affordable means of information and communication. Reliance
Infocom, with the aim of making mobile calls cheaper than postcards, built a
60,000-kilometre-long fiber optic backbone, crisscrossing the entire country.
Reliance currently offers its services in 340 towns with its eight circle footprints; it
also initiated mobile data services through its R-world mobile portal. This portal
leverages the data capability of the CDMA 1X network.
BUSINESS STRATEGIES
Integrated Service
From the beginning, Reliance believed in providing integrated communication
services to its customers. The company claims that it sells a greater number of
handsets compared to those sold by the market leader, Nokia.
Large Distribution Network

Reliance has created the largest chain of digital entertainment and
communication stores – Reliance Web World. The company is also expanding its
reach aggressively through retail outlets, sales agents and electronic recharge
outlets

STRATEGIC MOVE:
Reliance Communications is using Green plum Database, running on the Sun

Data Warehouse Appliance, to power a range of applications, from legal and
regulatory compliance to call detail record analysis.
Reliance's choice of the Sun Data Warehouse Appliance gives the company a
distinct advantage in the highly competitive and fast-growing Indian telecom
market by enabling high-speed, well-informed business decisions,". "In addition to
the high performance computer power of the Data Warehouse Appliance,
Reliance will also benefit from the Solaris 10 Operating System and Solaris™ ZFS
file system with its dramatic advances in file management and data integrity.
Altogether the Sun and Green plum solution gives Reliance a new level of
business intelligence."

VODAFONE
STRATEGIC MOVES: HUCTH ACQUISITION
The acquisition is a major strategic move for Vodafone as it gives the company a
strong presence in a fast growing market. Hutch-Essar is the third largest GSM
mobile operator and fourth largest overall in India with a premium customer base
and average customer revenues, which are much higher than industry average.
Though the Hutch brand has a very premium positioning and is one of the most
recognizable in the industry, Vodafone is likely to gradually replace it with its own
brand.
VODAFONE AND BHARTI PARTNERSHIP

The strategic investment in Bharti has been a very profitable one for Vodafone.
The company had paid around $1.5 billion for its 10-per cent stake and is likely to
receive close to $1.6 billion from the Bharti Group for the 5.6 per cent being sold
to them.
In another significant move which could alter the competitive landscape of the
mobile telecom industry, Vodafone and Bharti have teamed up to share telecom
infrastructure. This would mean Bharti and Vodafone would have access to each
other's infrastructure like telecom towers and other equipment for future expansion
needs, mostly in rural areas, which would bring down costs.
Vodafone said it is expecting savings of up to $1 billion every year from this pact
with Bharti. In a separate announcement, Bharti said it would share a range of
infrastructure - including around 70,000 towers - with Vodafone. Bharti would be
the preferred vendor for Vodafone for NLD, ILD and leased line services.

data tabulations, interpretations and findings
The fourteen factors on which I have compared the companies are:
1. Advertising Campaigns
2. Offer from the companies to the customers at the time of new

connections.
3. Network Connectivity in Lucknow.

4. Offers to the existing customers.
5. Customer care.
6. Products and tariff plans.
7. Prepaid services.
8. Postpaid services.
9. Internet/ data card services.
10. Value added services (VAS).
11. Communication with retailers for new schemes and changes in

schemes.
12. Profitability from the retailer’s point of view.
13. Demand in the market.

14. Response, for the requests of the customers and retailers.
The overall tabulation of the questionnaire responses is as

follows.

1. Advertisement campaign
Ranking
1. Vodafone
2. Airtel
3. Idea
4. Reliance
5. BSNL
6. Tata Indicom
Looking at the responses Vodafone is doing very well in advertising
campaigns, BSNL stands at fifth position in advertising campaigns, it
depicts that the BSNL advertising is not as effective as Airtel or
Vodafone. BSNL is far behind Vodafone in advertising campaigns,
which shows its weakness.

2. OFFER FROM COMPANIES TO THE NEW CUSTOMERS
AT THE TIME OF NEW CONNECTION.
Ranking:
1. BSNL
2. Reliance
3. Airtel and Idea
4. Vodafone
5. Tata Indicom
These offers are given by companies to attract the customer of other

service providers or new customers of the industry. 23% of the retailers
think that BSNL provides best offers with new connections. Reliance
is at the second position, though reliance offers are very attractive but
the reason is Reliance offers CDMA connection that may be a reason
why it stands at the second position.

3. Network connectivity in Lucknow
Ranking:
1. Airtel
2. Vodafone
3. Reliance
4. BSNL
5. Idea
6. Tata Indicom
BSNL stands forth in terms of connectivity. Airtel and Vodafone have

better connectivity. Being good in connectivity is essential to survive
in telecom sector, Reliance Communication uses CDMA technology
which gives better connectivity and better voice clarity comparing to
the GSM technology. But still retailer thinks that Reliance network is
not as good as Airtel and Vodafone.
4. Offers to the new customers
Ranking:
1. Reliance
2. Airtel
3. Idea
4. BSNL
5. Vodafone
6. Tata Indicom
Reliance stands at the first position in providing offers to the

customers. Reliance keeps on launching new attractive offers time to
time. In last two months reliance has launched five new offers on color
mobiles of LG and Classic at the rates. No other company can offer
mobile sets at such cheaper rates.

5. Customer care
Ranking:
1. Airtel
2. Vodafone
3. Reliance
4. Idea
5. BSNL
6. Tata Indicom
Customer care is a very important factor for any company in taking

competitive advantage. Retailers think that BSNL is at the fifth
position in customer care.
Airtel got 40% of the votes from retailers which show that retailers are
well satisfied with Airtel customer care.

6. Products and tariff plans
Ranking:
1. Reliance
2. Idea
3. Airtel
4. BSNL & Vodafone
5. Tata Indicom
Reliance offers best plans, cheapest call rates and attractive tariff
vouchers. Reliance also provides LG and Classic handsets at
unbelievably low cost. And hence it stands at the first. BSNL is also
offering cheaper call rates and attractive tariffs to the customers.

7. Prepaid services
Ranking:
1. Airtel
2. Reliance
3. Vodafone
4. Idea
5. BSNL
6. Tata Indicom
37% are in the favor of Airtel and 35% are in the favor of Reliance.
The reason may be due to the difference in the technology that is
CDMA and GSM.

8. Post paid services
Ranking:
1. Reliance
2. Vodafone
3. Airtel
4. Idea
5. BSNL
6. Tata Indicom
Reliance enjoys no. one position in postpaid services no with no

competitor near it; the nearest competitor is Airtel 20%. Which is still
far away it shows that reliance has well captured the postpaid market.

9. Internet and data card
Ranking:
1. Airtel
2. Reliance
3. BSNL
4. Tata Indicom
5. Idea
6. Vodafone
In broad band segment Airtel is no. one reason in Airtel broadband is

available in every area of Lucknow but the conditions are not same
with BSNL its broadband is available in some parts of Lucknow.
BSNL also provides Net connect facility which is a better service than
broadband it is a wireless service which can be used with laptops and
desk tops as well. BSNL offers net connect with attractive schemes.
Net connect is now getting very popular in the market. The only

competitor in this segment of net connect is Tata Indicom.
10. Value added services
Ranking:
1. Airtel
2. Reliance
3. Vodafone
4. BSNL & Idea
5. Tata Indicom
In value added services BSNL stands forth and Airtel is again no. one
in this segment. Both Airtel and Reliance are providing excellent VAS
but the target customer of Reliance and Airtel are different.

11. Communication with retailers for new schemed and
change in schemes
Ranking:
1. Reliance
2. Airtel
3. Vodafone
4. Idea
5. BSNL
6. Tata Indicom
I asked this question to the retailers to know which company is
friendly with the retailers, since retailers play a very important role in
increasing the sales of any company, and if a company is not
communicating well with retailers about the changes in schemes and
about new schemes. The retailer will communicate wrong or old
scheme and call rates to customer which may alter the sales of that
company.

12. Profitability from retailer’s
Point of view
Ranking:
1. Reliance
2. Idea
3. Airtel
4. BSNL
5. Vodafone
6. Tata Indicom
Asking about which company is more profitable for retailers. The

majority of the retailers think its Reliance. The reason behind asking
this question was, retailers would promote the sales of that company
more which is more profitable for them. BSNL is in forth no. For
profitable company for retailers.

13. demand from customers
Ranking:
1. Reliance
2. Airtel
3. BSNL
4. Vodafone
5. Idea
6. Tata Indicom
The figures depicts that Reliance has highest demand in the market.
The next is Airtel and in third BSNL is there has some demand in the
market.

14. Response to the requests of
customers and retailers
Ranking:
1. Airtel
2. Vodafone
3. Reliance
4. BSNL
5. Idea
6. Tata Indicom
Which company gives quick Responses, for the requests of the

customers and retailers? Requests like demand for special mobile no.,
blocking the no. in case of theft of mobiles. Retailer’s requests like e-
recharges, invalid recharge coupons etc. retailers think Airtel gives
quick responses for such request. Surprisingly BSNL got 10% of the
votes for quick response.

Findings from the
Customer satisfaction
Survey
Reasons to choose services of this company
Problems faced with current operator

Rating the customer care

switching to the other company and why?

Conclusion
This research on market competitiveness of BSNL in Lucknow telecom
sector helps to analyze and understand the trends of telecom industry
and the market position of BSNL in Lucknow. It is an honest attempt
conducted to understand the market complexities and the problems
faced by the company.
Telecom industry is growing very fast in India and so in Lucknow. The
competition in telecom market is very high and each and every area
of service matters equally. BSNL has strongly positioned itself for
accelerating market growth but now it is emphasizing to reach in the

un-served market. Airtel and Vodafone being the strongest
competitors, BSNL is required to work on its weaknesses and grab the
opportunities beforehand to maintain and improve its market
position in the telecom sector.
The study reveals the weaknesses and strengths of BSNL.
BSNL needed to improve its Customer care, network connectivity and
offers to new connections. The study based on the several months of
data, clearly brings out the need for ensuring effective
interconnection between various operators in view of the rapid
growth in the mobile customer base. The study further reveals, that
to be able to cope up with this growing rate, without congestion in
the network, there is an imperative need to drastically curtail the time
needed for providing the interconnection or for meeting the
augmentation requests.
recommendations
Product line and attributes

1. Company should monitor and revive its product related features.
2. Company should adapt an innovative approach and always be
ahead of its competitors.
3. Always look for latest technology, equipped with enhanced set of
facilities
4. Regularly modify or replace the product in order to make a niche in
the target segment.

Tariff plans
1. Company should make tariff plans simpler. TRAI has also its keen
concern on the complexity of tariff plans which rather helping the
retailers and customers they confuse them.
2. Company should categorize the tariff plans into three categories
like each category for an individual set of customers on the basis of
their usage pattern. This will help them to identify the best suited
tariff plan for his/her requirement. Following categories is suggested:
a) Low budget users (L)
b) Medium budget users (M)
c) High budget users (H)
Market expansion
1. Company should try to retain the present retailer base and look
forward to unexplored markets.
2. Company should focus on those retailers, which are not giving huge
business but have potential to do so.
bibliography
1. Kotler. Phillip, Keller. Kevin, Marketing management, prentice hall
India, 12th edition.
2. Kevin.j.clancy, Robert .s. shulmen, marketing myths that are killing business,
McGraw hill (New York).
3. Saxena rajan, marketing management, Tata McGraw hill.
4. Levin.m.david, Bearson.l.mack, Business statistics, Pearson education, 2nd

Edition, 2001.
questionnaire
DEMOGRAPHIC PROFILE:
Name of the outlet___________________________________________
Name of the retailer_________________________________________
Location of the retailer_____________________________________
Contact number______________________________________________
Q1. Which company is best in terms of advertising campaigns in

Lucknow region?
1. Reliance 2.Airtel 3.Idea

4. Vodafone 5. Tata Indicom 6. BSNL
Q2. Which company gives best offers at the time of new

connections?
Q3. Which one is the best service provider in terms of connectivity in

Lucknow and outers of Lucknow?
Q4. Which company provides the best offers to the customers?

Q5. Which company gives the best customer care services to the
customers?
Q6. Which company provides best products and tariff plans to the
customers?
Q7. Which company is the best in providing prepaid services?


Q8. Which company is the best in providing postpaid services?

Q9. Which company is the best in providing internet/data card

services?
Q10. Which company provides the best value added services to the customers?
Q11. Which company is the best in communicating the changes in

schemes and new schemes to the retailers?
Q12. Which company is most profitable from the retailers’ point of

view?
Q13. Which company has the highest demand from the customers?

Q14. Which company gives the fastest response to the requests of
customers and retailers?

Thank you
Sample Questionnaire (Customer Survey)
DEMOGRAPHIC PROFILE
Name of the Customer: _________________________________
Contact Number: _________________________________
Q1. Which type of connection do you use?

a. Pre-paid b. Post-paid c. Prepaid Fixed
d. Postpaid fixed e. Data card
Q2. You are using the services of which company?

a. Reliance b. Airtel c. Vodafone d)Idea
e. BSNL f. Tata Indicom
Q3. Which Tariff Plan are you using?

_________________________________________________________

____________
Q4.Why you have chosen the services of this particular company?

a. Customers focus b. Service delivery
c. Better network coverage d. Promotional Schemes &Tariff
e. Better Sales Support
Q6. Do you face any problem with services being offered by the
operator, if yes please tick
a. Bill not received on time b. Bill dispute/ Hidden costs
c. Unsatisfactory plan d. Network
e. Any other (Please Specify)
_____________________________________________
Q7. How would you rate the Customer care of the company whose
services you are using?
a. Excellent (4/4) b. Good (3/4) c. Average (2/4)
d. Unsatisfactory (1/4)
Q8. If you have to switch to some other Brand which would it be apart
from the one you are using.
a. Reliance b. Airtel c. Vodafone d. Idea
e. BSNL f. Tata Indicom
Q9. Any suggestions to improve the services/ customer base of BSNL:

1. Improvement in Network Coverage
______________________________________
2. Improvement in Service Quality
______________________________________
3. Improvement in Customer Care
______________________________________

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Research Report

Submitted For The Partial Fulfillment Of The Degree Of

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT

PGP/IIPM/SS 2009-11/SC 2 Page 1

I give my special regards to Mr. S.S.Chauhan (Director) for guiding me in the

I will be failing in my duty if I do not express my gratitude to my family and

PGP/IIPM/SS 2009-11/SC 2 Page 3

PGP/IIPM/SS 2009-11/SC 2 Page 4

PGP/IIPM/SS 2009-11/SC 2 Page 5

The Ministry of Communications and Information Technology (MCIT) is has very

 State owned companies like - BSNL and MTNL.

PGP/IIPM/SS 2009-11/SC 2 Page 7

Bharat Sanchar Nigam Limited (known as BSNL, India Communications

BSNL, a state-owned service provider in India, is the seventh-largest

PGP/IIPM/SS 2009-11/SC 2 Page 8

COMPANY NAME: Bharat Sanchar Nigam Ltd.

Headquarters: Bharat Sanchar Bhawan, Harish Chandra Mathur Lane,

Head Office in Lucknow: Hazratganj

Branch office in Lucknow: Sapru marg, Hazratganj, Alambagh,

Chairman & Managing Director: Kuldeep Goyal

Status: Mini Ratan (a status assigned to reputed public sector companies

Founded: 19th century, incorporated 2000

Owner: Government of India

Employees: 357,000 march 31, 2009

PGP/IIPM/SS 2009-11/SC 2 Page 9

Cellular Mobile Telephone Services: BSNL is major provider of Cellular Mobile

Internet: BSNL provides internet services through dial-up connection

PGP/IIPM/SS 2009-11/SC 2 Page 10

PGP/IIPM/SS 2009-11/SC 2 Page 11

• Incoming video call facility allowed to 2G customers with 3G enabled handsets

PGP/IIPM/SS 2009-11/SC 2 Page 12

 Consumer awareness of latest technology and service support in telecom.

 To find out market share of selected telecom brand in Lucknow city.

 To determine the satisfaction level of customers having BSNL connection.

PGP/IIPM/SS 2009-11/SC 2 Page 13

 Formulating objective of the study.

PGP/IIPM/SS 2009-11/SC 2 Page 14

PGP/IIPM/SS 2009-11/SC 2 Page 15

 Sample unit: sampling unit in the research project is network customers

 Sample area: Lucknow city

PGP/IIPM/SS 2009-11/SC 2 Page 16

 Developing a research instrument in seven days.

 Gathering the information in five days.

 Analyzing and interpreting it in terms of problem being tackled in seven

 Summarizing the finding in five days.

 Preparing the research report in seven days.

Total research report completed in thirty -six days.

PGP/IIPM/SS 2009-11/SC 2 Page 17

FIXED LINE TELEPHONY

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Market shares of public and private players

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Mobile telephony provides services such as messaging– text and multimedia–

PGP/IIPM/SS 2009-11/SC 2 Page 20

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As per a new study by TRAI (Telecom Regulatory Authority of India),

India had around 7.7 million Internet subscribers by June 2008.