Indian Telecom Industry

1121 Words Dec 26th, 2008 5 Pages
Indian Telecom Industry

Truly Unmatched Growth Story
Indian Telecom Sector has come a long way since the days, when one had to wait for upto ten years for getting a new landline connection. The growth story that has unfolded in the past ten years has provided common man with the opportunity to access this highly needed facility. Indian Telecom Companies have written numerous success stories in their journey to make the dream of affordable and effective communication facility for Indian very much possible!

In 1991, India had just five million telephone subscribers. As at the end of October 2008, there were 363.95 million subscribers.Teledensity too which was below one telephone per 100 population has now risen sharply to above 30.
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CDMA:
From the time mobile phones were introduced in the country in 1997, until the end of 2002, the market was dominated by just one technology, namely, GSM. In December 2002, Reliance Communications (then known as Reliance Infocomm) launched CDMA services across 17 circles on a countrywide basis. CDMA has since been growing faster than GSM; although on a lower base.

Most Indian consumers are unaware of the nitty-gritty of the two technologies. So the deciding factor between the two technologies is often based on price and other conditions of offer such as the coverage of the service, ease of obtaining a new connection and whether a handset is available at a reduced price as part of the deal.

Given this sort of a possibility of perfect substitution between the two types of technologies, the existence of the two standards has made both the markets for GSM and CDMA services very competitive. This is especially so when the market for CDMA services is highly concentrated with just two service providers accounting for almost the entire output.

Current Scenario in Telecom Industry
Declining ARPU:
After the Government allowed Companies in private sector to offer telecom services in India, followed by the entry of mobile service providers, competing intensely with each other to grab larger pie of the market, telecom consumers were benefited with periodically decrease in the
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