Telecommunications in India

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With its high population and development potential is having one of the fastest growing telecom networks in the world. India's public sector telecom company BSNL is the 7th largest telecom company in world. [1]. Reliance, Bharti Telecom, Tata Indicom, Hutch, MTNL, and BPL are other major operators in India. However, rural India still lacks strong infrastructure.

India introduced telephony in 1882
India introduced telephony in 1882

The total number of telephones in the country crossed the 100 million mark in April 2005 and was 202.74 million in February 2007. [1] This includes 156.31 million mobile phones. However, teledensity (telephones per 100 persons) in the country was 18.26 per cent in February 2007. [2]

Contents

[edit] History

Telecom in the real sense means transfer of information between two distant points in space. The popular meaning of telecom always involves electrical signals and nowadays people exclude postal or any other raw telecommunication methods from its meaning. Therefore, the history of Indian telecom can be started with the introduction of telegraph.

[edit] Introduction of Telegraph

The postal and telecom sectors had a slow and uneasy start in India. In 1850, the first experimental electric telegraph Line was started between Kolkata and Diamond Harbour. In 1851, it was opened for the British East India Company. The Posts and Telegraphs department occupied a small corner of the Public Works Department, at that time. Construction of 4,000 miles of telegraph lines connecting Kolkata and Peshawar in the north via Agra, Mumbai through Sindwa Ghats, and Chennai in the south, as well as Ootacamund and Bangalore was started in November 1853. Dr. William O'Shaughnessy, who pioneered telegraph and telephone in India, belonged to the Public Works Department. He tried his level best for the development of telecom through out this period. A separate department was opened in 1854 when telegraph facilities were opened to the public.

[edit] Introduction of the Telephone

In 1880, two telephone companies namely The Oriental Telephone Company Ltd. and The Anglo-Indian Telephone Company Ltd. approached the Government of India to establish telephone exchanges in India. The permission was refused on the grounds that the establishment of telephones was a Government monopoly and that the Government itself would undertake the work. By 1881, the Government changed its earlier decision and licence was granted to the Oriental Telephone Company Limited of England for opening telephone exchanges at Kolkata, Mumbai, Chennai and Ahmedabad. January 28, 1882, is a Red Letter Day in the history of telephone in India. On this day Major E. Baring, Member of the Governor General of India's Council declared open the Telephone Exchange in Kolkata, Chennai and Mumbai. The exchange at Kolkata named "Central Exchange" was opened at third floor of the building at 7, Council House Street. The Central Telephone Exchange had 93 number of subscribers. Bombay also witnessed the opening of Telephone Exchange in 1882 itself.

[edit] Further developments

In 1902 first wireless telegraph station established between Saugor Islands and Sandheads. In 1907, first Central Battery working of telephones introduced in Kanpur. Between 1913 and 1914 first Automatic Exchange was installed in Simla. On July 23, 1927 Radio Telegraph started working between UK and India. The beam station at Kirkee and Dhond opened by Lord Irwin and greetings exchanged with the King of England. In 1933 Radio-Telephone also started between India and UK. 12 channel carrier system was introduced in 1953. First subscriber trunk dialing route commissioned between Kanpur and Lucknow in 1960. First PCM system between city and Andheri telephone exchanges commissioned in Mumbai in 1975. First digital microwave junction was introduced in 1976. First optical fibre system for local junction commissioned at Pune in 1979. First satellite earth station for domestic communications was established at Secunderabad(U.P.). First analog Stored Program Control exchange for trunk lines was commissioned at Bombay. In 1984 C-DOT was established for indigenous production and development of digital exchanges. In 1985 mobile telephone service started (not commercially) in Delhi.

While all the major cities and towns in the country were linked with telephones during the British period, the total number of telephones in 1948 was only around 80,000. Even after independence, growth was extremely slow. The telephone was a status symbol rather than being an instrument of utility. The number of telephones grew leisurely to 980,000 in 1971, 2.15 million in 1981 and 5.07 million in 1991, the year economic reforms were initiated in the country.

While certain innovative steps were taken from time to time, as for example introduction of the telex service in Mumbai in 1953 and commissioning of the first [subscriber trunk dialing] route between Delhi and Kanpur in 1960, the first waves of change were set going by Sam Pitroda [3] in the eighties. He brought in a whiff of fresh air. The real transformation in scenario came with the announcement of the National Telecom Policy in 1994 [4].

[edit] India, emerging as a major player

In 1975, the Department of Telecom (DoT) was separated from P&T. DoT was responsible for telecom services in entire country until 1985 when Mahanagar Telephone Nigam Limited (MTNL) was carved out of DoT to run the telecom services of Delhi and Mumbai. In 1990s the telecom sector was opened up by the Government for private investment as a part of Liberalisation-Privatization-Globalization policy. Therefore, it became necessary to separate the Government's policy wing from its operations wing. The Government of India corporatised the operations wing of DoT on October 01, 2000 and named it as Bharat Sanchar Nigam Limited (BSNL). Many private operators, such as Reliance India Mobile, Tata Telecom, Hutch, BPL, Bharti, Idea etc., successfully entered the high potential Indian telecom market.

[edit] Growth of mobile technology

India has become one of the fastest growing mobile markets in the world [2]. The mobile services were commercially launched in August 1995 in India. In the initial 5-6 years the average monthly subscribers additions were around 0.05 to 0.1 million only and the total mobile subscribers base in December 2002 stood at 10.5 millions. However, after the number of proactive initiatives taken by regulator and licensor, the monthly mobile subscriber additions increased to around 2 million per month in the year 2003-04 and 2004-05.

Although mobile telephones followed the New Telecom Policy 1994, growth was tardy in the early years because of the high price of hand sets as well as the high tariff structure of mobile telephones. The New Telecom Policy in 1999, the industry heralded several pro consumer initiatives. Mobile subscriber additions started picking up. The number of mobile phones added throughout the country in 2003 was 16 million, followed by 22 millions in 2004, 32 million in 2005 and 65 million in 2006. The only countries with more mobile phones than India with 156.31 million mobile phones are China – 408 million and USA – 170 million. [5]

India has opted for the use of both the GSM (global system for mobile communications) and CDMA (code-division multiple access) technologies in the mobile sector. In addition to landline and mobile phones, some of the companies also provide the WLL service.

The mobile tariffs in India have also become lowest in the world. A new mobile connection can be activated with a monthly commitment of US$ 5 only. In 2005 alone 32 million handsets were sold in India. The data reveals the real potential for growth of the Indian mobile market. (Ref:TRAI [6])

[edit] Present scenerio

In the fixed line arena, BSNL and MTNL are the incumbents in their respective areas of operation and continue to enjoy the dominant service provider status in the domain of fixed line services. For example BSNL controls 79% of fixed line share in the country. On the other hand, in the mobile telephony space, Airtel controls 21.4% subscriber base followed by Reliance with 20.3%, BSNL with 18.6%, Hutch with 14.7% subscriber base (as per June 2005 data).(Ref: TRAI Report [7] and Press Release [8] )

[edit] Next generation networks

In the Next Generation Networks, multiple access networks can connect customers to a core network based on IP technology. These access networks include fibre optics or coaxial cable networks connected to fixed locations or customers connected through wi-fi as well as to 3G networks connected to mobile users. As a result, in the future, it would be impossible to identify whether the next generation network is a fixed or mobile network and the broadband wirelessaccess would be used both for fixed and mobile services. It would then be futile to differentiate between fixed and mobile networks – both fixed and mobile users will access services through a single core network.
Indian telecom networks are not so intensive as developed country’s telecom networks and India's teledensity is low only in rural areas. 670,000 route kilometers of optical fibres has been laid in India by the major operators, even in remote areas and the process continues. BSNL alone, has laid optical fibre to 30,000 Telephone Exchanges out of their 35,000 Exchanges. Keeping in mind the viability of providing services in rural areas, an attractive solution appears to be one which offers multiple service facility at low costs. A rural network based on the extensive optical fibre network, using Internet Protocol and offering a variety of services and the availability of open platforms for service development, viz. the Next Generation Network, appears to be an attractive proposition. Fibre network can be easily converted to Next Generation network and then used for delivering multiple services at cheap cost.

[edit] Revenue and growth

The total revenue in the telecom service sector was Rs. 86,720 crore in 2005-06 as against Rs. 71, 674 crore in 2004-2005, registering a growth of 21%. The total investment in the telecom services sector reached Rs. 200,660 crore in 2005-06, up from Rs. 178,831 crore in the previous fiscal. [3]

Telecommunication is the lifeline of the rapidly growing Information Technology industry. Internet subscriber base has risen to 6.94 million in 2005- 2006. Out of this 1.35 million were broadband connections. [4] More than a billion people use the internet globally.

Under the Bharat Nirman Programme, the Government of India will ensure that 66,822 revenue villages in the country, which have not yet been provided with a Village Public Telephone (VPT), will be connected. However doubts have been raised about what it would mean for the poor in the country. [9]

It is difficult to ascertain fully the employment potential of the telecom sector but the enormity of the opportunities can be gauged from the fact that there were 3.7 million Public Call Offices in December 2005 [5] up from 2.3 million in December 2004.

The value added services (VAS) market within the mobile industry in India has the potential to grow from $500 million in 2006 to a whopping $10 billion by 2009(Music, games to drive mobile VAS growth).

[edit] Service providers in India

[edit] Basic service licencees

Only the PSU's BSNL and MTNL are allowed to provide Basic Phone Service through copper wires in India. MTNL is operating in Delhi and Mumbai only and all other parts are covered by BSNL.

[edit] Cellular mobile service licencees

  1. BSNL
  2. MTNL
  3. Bharti Hexacom Ltd
  4. Idea Cellular Ltd
  5. Reliance Telecom Ltd
  6. Hutchison Essar Ltd
  7. Aircel Ltd
  8. BPL Mobile Communications Ltd
  9. Escorts Telecommunications Ltd
  10. Fascel Ltd
  11. BTA Cellcom Ltd

[edit] Internet service providers

  1. BSNL
  2. Bharti
  3. CMC Ltd
  4. Comsat Max Ltd
  5. Cyquator Technologies Ltd.
  6. Data Access India Ltd.
  7. Data Infosys Ltd.
  8. Dishnet Wireless Ltd.
  9. Ernet India
  10. Estel Communications Pvt. Ltd.
  11. Gateway Systems (India) Pvt. Ltd
  12. GTL Limited
  13. Guj Info Petro Ltd. (GIPL)
  14. Gujarat Narmada Valley Fertilizers Co. Ltd.(GNFC)
  15. Hathway Cable & Datacom Pvt. Ltd.
  16. HCL Comnet Systems & Services Ltd.
  17. HCL Infinet Ltd.
  18. Hughes Escorts Communications Ltd.
  19. Iqara Telecoms India Pvt. Ltd. (BG Broadband)
  20. i2i Enterprise Ltd.
  21. In2cable.com(I) Ltd.
  22. L&T Finance Ltd. (L&T Netcom Ltd.)
  23. Manipal Ecommerce Ltd. (Manipal Control Data Electronic Commerce Ltd.)
  24. n-Logue Communications Pvt. Ltd.
  25. Nelco Ltd.
  26. Primenet Global Ltd.
  27. Primus Telecommunications India Ltd.
  28. Pacific Internet (I) Pvt. Ltd.
  29. Reach Network (I) Pvt. Ltd. (Teleweb India Pvt. Ltd.)
  30. Reliance Communications Infrastructure Ltd.
  31. Reliance Engineering Associates Pvt. Ltd. (Broadband Solutions)
  32. RPG Infotech Ltd. (Sprint RPG India)
  33. Shyam Internet Services Pvt. Ltd.
  34. Sify Ltd.
  35. VSNL
  36. TATA teleservices
  37. Spectra Net Ltd.
  38. Swiftmail Communications Ltd
  39. Tulip IT Services Ltd
  40. Trak Online Net India (P) Ltd
  41. (Net4India) Software Technology Park of India (STPI)
  42. Siti Cable Network Ltd.(Zee Interactive Multimedia Ltd.)

[edit] Equipment manufacturers

  1. ITI Ltd.
  2. C-DOT
  3. Nokia
  4. Samsung Electronics
  5. Motorola
  6. Ericson

[edit] References

  1. ^ Telecom Regulatory Authority of India, press release no. 443 /2007, 16 March 2007
  2. ^ Telecom Regulatory Authority of India, press release no. 89 /2006, 12 September 2006
  3. ^ Press Release no. 60/2006 issued on 28 June 2006 by TRAI
  4. ^ Press Release No. no. 60/2006 issued on 28 June 2006 by TRAI
  5. ^ Press Release No. no. 35/2006 issued on 10 April 2006 by TRAI

[edit] External links

[edit] See also

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