Indian Telecommunications

An Overview

History

Telephone services in India begun in a small scale with the commissioning of a 50-line manual telephone exchange in 1882 in Kolkata. This was less than five years after the invention of the telephone by Alexander Graham Bell. India had approx. 82,000 telephone connections at the time of independence (1947) and by 1984 the number of connections had slowly risen to 3.05 million. India's telecom network was notoriously unreliable and only available to a small section of households along with the corporate sector. The telecom sector was a government monopoly until 1994 when liberalisation gradually took place. Cellular service was launched in November 1995 in Kolkata.

Expanding Network

The Indian telecom industry has grown rapidly during the last few years. India has the third largest (based on the total number of fixed/mobile subscriber lines) telecom network in the world and the second¹ largest mobile network with over 635 million subscribers while the total number of telephone lines amounted to almost 672 m at the end of June 2010. While subscriber volumes continue to grow in the larger urban areas, the maximum growth potential lies within rural India comprising of over 600,000 villages and well below average teledensity levels. Coverage is increasing rapidly, eg Reliance Mobile's network covers 400,000 villages and 14,000 towns across India as of Feb '09. The number of phone subscribers in rural areas (rural population amounts to 70 % of India's over 1.1 billion inhabitants) was only 64 m at the end of Nov '07. An estimated base of 650 million subscribers is envisaged by 2012. Revenue from fixed and mobile services amounted to an estimated Rs 880 bn in fiscal year 2005. National long distance (NLD) and international long distance (ILD) service revenues grew to an estimated Rs 93 bn in the same year. While the number of mobile subscribers increased by 27.9 m in 2005, this figure skyrocketed to 83 m in 2007 and grew even further to around 113 million added mobile subscribers in 2008. India's telecom market is now the largest in the world based on the number of new monthly subscribers added.

The government has set a target under the Bharat Nirman program, to connect all the remaining villages without telephone services, basically VPT's (Village Public Telephones), by the end of 2009.

² This figure includes GSM, CDMA and WLL-Fixed subscribers

Mobile

While anywhere upto 20 million new mobile subscriber lines are being added every month (India is the world's largest market for the number of added new mobile subscribers), the number of landlines is gradually decreasing. Overall telecom subscriber penetration increased to over 52 % at the end of Q1/2010. This is a relatively low figure in comparison to many other nations but nevertheless is a quantum leap from a few years back. Mumbai and Delhi (NCR) are among the few metro areas globally to have over 25 m mobile subscribers each. The FDI cap in the telecom sector is currently 74 %. UK's Vodafone Group recently acquired a 52 % stake in Hutchison Essar, India's fourth largest mobile service provider. Bharti Airtel is the first Indian operator to exceed a subscriber base of 50 million.

Mobile number portability (MNP) is expected to be available across India by Oct '10. 3G (third generation) mobile services are initially being introduced in the major cities. Three 3G spectrum slots are to be auctioned in early 2010 to private bidders. The number of broadband connections is growing albeit at a slow pace.

Telecom Manufacturing

A growing number of telecom companies have set up manufacturing facilities for the production of mobile phones and other telecom equipment to cater to India's growing telecom market and exports too. Nokia's plant, located in a Special Economic Zone (SEZ) at Sriperumbudur near Chennai, manufactures mobile handsets and network infrastructure equipment incl. base stations. Nokia's plant produces ca 8 m handsets a month. A slew of other telecom equipment manufacturers already have or are in the process of setting up production facilities in the same zone. These include Aspocomp Group (HDI printed circuit boards), Perlos (handset mechanics/mouldings), Salcomp (mobile phone chargers), Motorola (mobile handsets), Foxconn (mobile phones), Flextronics (mobile handsets, base stations and other electronic items), Sanmina-SCI (network components), Jabil, Laird (antennas, battery packs and EMI shielding products) and Wintek. Elcoteq's telecom plant located near Bangalore manufactures handsets among others. Samsung Electronics' mobile handset plant is located in Gurgaon, near Delhi. Alcatel and Ericsson manufacture base station and mobile switching equipment at plants located in Rae Bareli and Jaipur respectively. BPL Telecom manufactures GSM phones and LG Electronics India produces GSM phones in a plant near Pune. Kolkata based Xenitis Group plans to set up a mobile phone manufacturing facility located near Kolkata.

Mobile handsets account for 26 % of the total telecom equipment industry in India. The lion's share was held by the carrier equipment business while the enterprise equipment segment accounted for the remaining 14 %. The market size of the telecom equipment industry grew to Rs 954 (ca USD 22 bn).

Mobile Network Statistics

India's Largest Telecom Operators as on Dec 31, 2009¹
Operator	Subscriber Base (millions)
Bharti Airtel	118.9
Reliance Communications	93.8
Vodafone Essar	91.4
Bharat Sanchar Nigam Ltd.	62.9
Idea Cellular Ltd.	57.6
Tata Teleservices Ltd.	57.3

Wireless Subscribers (in millions) in the Four Metros as on Jun 30, 2010 ¹
City	Total	Operators
Delhi	31.0	Bharti Airtel, Vodafone Essar, MTNL, Idea Cellular, Reliance and Tata Teleservices
Mumbai	29.1	Loop Mobile, Idea Cellular, Vodafone Essar, MTNL, Bharti Airtel, Reliance and Tata Teleservices
Kolkata	17.5	Aircel, Bharti Airtel, Vodafone Essar, BSNL, Reliance and Tata Teleservices
Chennai	11.4*	Aircel Cellular, Bharti Airtel, Vodafone Essar, BSNL, Reliance and Tata Teleservices

¹ Source: TRAI. Figures include CDMA, GSM and WLL(Fixed) connections. * Apr 30 '10

SOME FACTS & FIGURES ON INDIAN TELECOM

Number of telecom (mobile and landlines) subscribers: ~672 million (as on 30.6.10)
Number of fixed line subscribers: 36.2 m (as on 30.6.10)
Number of cellular (GSM, CDMA and WLL-Fixed) subscribers: ~636 m (as on 30.6.10)
Number of broadband subscribers: 9.5 m (as on 30.6.10)
Number of GSM cellular subscribers: 444 m (as on 31.5.10)
Number of CDMA cellular subscribers: 155 m (as on 31.12.09)
Overall teledensity: ca 568/1000 inhabitants (as on 30.6.10)
Number of PCO's (Public Call Offices): 2.27 m (as on 31.12.07)
Number of VPT's (Village Public Telephones): 0.55 m (as on 31.3.06)
More telecom at the Department of Telecommunications network status page.
Total revenues of telecom service providers (2005-06): Rs. 880 bn
Telecom equipment production (2007-08): Rs. 954 bn
Mobile handset market (2009): estimate Rs. 300 bn

Currency: 1 USD equals approx. 46 Indian Rupees (Rs)

Govt. Telecom Links

DOT - Department of Telecommunications
BSNL Telecom Network Statistics
BSNL - Bharat Sanchar Nigam Ltd.
TRAI - Telecom Regulatory Authority of India
VSNL - India's public sector overseas telecommunications provider

Top

TELECOM NEWS

Indian Telecom News
Indian Bandwidth
VOICE & DATA (India)

Top

FIXED LINE OPERATORS

Public Operators

BSNL Units
Calcutta Telephones (under BSNL)
Chennai Telephones (under BSNL)
MTNL - Mumbai and Delhi
MTNL Mumbai
MTNL Delhi

Private Operators

Tata Teleservices: Operates in Andhra Pradesh, Delhi, Gujarat, Karnataka and Tamil Nadu,Maharashtra
Bharti Tele-Ventures Ltd: Operates in Delhi, Haryana, Madhya Pradesh, Tamil Nadu and Karnataka.
Reliance Infocomm: India's largest CDMA mobile operator with some 10 million subscribers
HFCL Infotel: HFCL Infotel operates in Punjab and Chandigarh

Top

WIRELESS (GSM/CDMA) SERVICE PROVIDERS

GSM Network Coverage >>

Tata Docomo
Sistema Shyam TeleServices Ltd.: Operates currently in Rajasthan, Tamil Nadu and Kerala and plans to cover all the circles by end-2010.
Reliance Communications
BSNL - Bharat Sanchar Nigam Ltd.
MTNL: Provides cellular service in Delhi and Mumbai.
IDEA Cellular: Operates in Gujarat, Maharashtra, Goa, Andhra Pradesh, Madhya Pradesh, Haryana, Kerala, Chhattisgarh, Himachal Pradesh, Uttaranchal, Uttar Pradesh (West) and Delhi.
Aircel Ltd.: Operates in Assam, North Eastern states, Orissa, West Bengal, Jammu & Kashmir, Tamil Nadu (incl. Chennai) and Puducheri.
Bharti Airtel: Provides mobile phone service in all the 23 circles of India.
Loop Mobile: Loop Mobile's cellular network coverage include Mumbai.
Vodafone Essar: Provides mobile phone service in 16 circles.
Spice Telecom: Provides mobile phone services in Karnataka and Punjab.
Aircell Digilink: Operates in Uttar Pradesh (East), Haryana and Rajasthan.
Virgin Mobile India
Uninor