The Indian telecommunications industry is the world's fastest growing telecommunications industry,[1][2][3] with 671.69 Million telephone (landlines and mobile) subscribers and 635.51 Million mobile phone connections as of June 2010 [4] It is also the second largest telecommunication network in the world in terms of number of wireless connections after China.[5] The Indian Mobile subscriber base has increased in size by a factor of more than one-hundred since 2001 when the number of subscribers in the country was approximately 5 million[6] to 635.51 Million in June 2010.[7]
As the fastest growing telecommunications industry in the world, it is projected that India will have 1.159 billion mobile subscribers by 2013.[8][9][10][11] Furthermore, projections by several leading global consultancies indicate that the total number of subscribers in India will exceed the total subscriber count in the China by 2013.[8][9] The industry is expected to reach a size of 344,921 crore (US$ 78.3 billion) by 2012 at a growth rate of over 26 per cent, and generate employment opportunities for about 10 million people during the same period.[12] According to analysts, the sector would create direct employment for 2.8 million people and for 7 million indirectly.[12] In 2008-09 the overall telecom equipments revenue in India stood at 136,833 crore (US$ 31.06 billion) during the fiscal, as against 115,382 crore (US$ 26.19 billion) a year before.[13]
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A large population, low telephony penetration levels, and a rise in consumers' income and spending owing to strong economic growth have helped make India the fastest-growing telecom market in the world. The first operator is the state-owned incumbent BSNL. BSNL was created by corporatization of the erstwhile DTS (Department of Telecommunication Services), a government unit responsible for provision of telephony services. Subsequently, after the telecommunication policies were revised to allow private operators, companies such as Vodafone, Bharti Airtel, Tata Indicom, Idea Cellular, Aircel and Loop Mobile have entered the space. see major operators in India. In 2008-09, rural India outpaced urban India in mobile growth rate. Bharti Airtel now is the largest telecom company in India.
India's mobile phone market is the fastest growing in the world, with companies adding some 20.31 million new customers in March 2010.
The total number of telephones in the country crossed the 671.69 million mark in June 30, 2010. The overall tele-density has increased to 44.85% in Oct 2009.Telecom Regulatory Authority of India,Information note to the Press (Press Release No. 61 / 2007), 20 Jun 2007 In the wireless segment, 19 million subscribers have been added in Dec 2009. The total wireless subscribers (GSM, CDMA & WLL (F)) base is more than 543.20 million now. The wireline segment subscriber base stood at 37.06 million with a decline of 0.12 million in Dec 2009.
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.
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 Harbor. 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,[14] at that time. Construction of 4,000 miles (6,400 km) of telegraph lines connecting Kolkata (Calcutta) and Peshawar in the north along with Agra, Mumbai (Bombay) 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 worked towards the development of telecom throughout this period. A separate department was opened in 1854 when telegraph facilities were opened to the public.
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. In 1881, the Government later reversed its earlier decision and a licence was granted to the Oriental Telephone Company Limited of England for opening telephone exchanges at Kolkata, Mumbai, Chennai (Madras) and Ahmedabad and the first formal telephone service was established in the country.[15] 28 January 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.
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 in the eighties.[16] He brought in a whiff of fresh air. The real transformation in scenario came with the announcement of the National Telecom Policy in 1994.[17]
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 1 October 2000 and named it as Bharat Sanchar Nigam Limited (BSNL). Many private operators, such as Reliance Communications, Tata Indicom, Vodafone, Loop Mobile, Airtel, Idea etc., successfully entered the high potential Indian telecom market.
The Indian government was composed of many factions (parties) which had different ideologies. Some of them were willing to throw open the market to foreign players (the centrists) and others wanted the government to regulate infrastructure and restrict the involvement of foreign players. Due to this political background it was very difficult to bring about liberalization in telecommunications. When a bill was in parliament a majority vote had to be passed, and such a majority was difficult to obtain, given to the number of parties having different ideologies.
Liberalization started in 1981 when Prime Minister Indira Gandhi signed contracts with Alcatel CIT of France to merge with the state owned Telecom Company (ITI), in an effort to set up 5,000,000 lines per year. But soon the policy was let down because of political opposition. She invited Sam Pitroda a US based NRI to set up a Center for Development of Telematics(C-DOT), however the plan failed due to political reasons. During this period, after the assassination of Indira Gandhi, under the leadership of Rajiv Gandhi, many public sector organizations were set up like the Department of Telecommunications (DoT) , VSNL and MTNL. Many technological developments took place in this regime but still foreign players were not allowed to participate in the telecommunications business.[18]
The demand for telephones was ever increasing. It was during this period that the P.N Rao led government introduced the national telecommunications policy [NTP] in 1994 which brought changes in the following areas: ownership, service and regulation of telecommunications infrastructure. They were also successful in establishing joint ventures between state owned telecom companies and international players. But still complete ownership of facilities was restricted only to the government owned organizations. Foreign firms were eligible to 49% of the total stake. The multi-nationals were just involved in technology transfer, and not policy making.[18]
During this period, the World Bank and ITU had advised the Indian Government to liberalize long distance services in order to release the monopoly of the state owned DoT and VSNL; and to enable competition in the long distance carrier business which would help reduce tariff's and better the economy of the country. The Rao run government instead liberalized the local services, taking the opposite political parties into confidence and assuring foreign involvement in the long distance business after 5 years. The country was divided into 20 telecommunication circles for basic telephony and 18 circles for mobile services. These circles were divided into category A, B and C depending on the value of the revenue in each circle. The government threw open the bids to one private company per circle along with government owned DoT per circle. For cellular service two service providers were allowed per circle and a 15 years license was given to each provider. During all these improvements, the government did face oppositions from ITI, DoT, MTNL, VSNL and other labor unions, but they managed to keep away from all the hurdles.[18]
After 1995 the government set up TRAI (Telecom Regulatory Authority of India) which reduced the interference of Government in deciding tariffs and policy making. The DoT opposed this. The political powers changed in 1999 and the new government under the leadership of Atal Bihari Vajpayee was more pro-reforms and introduced better liberalization policies. They split DoT in two- one policy maker and the other service provider (DTS) which was later renamed as BSNL. The proposal of raising the stake of foreign investors from 49% to 74% was rejected by the opposite political party and leftist thinkers. Domestic business groups wanted the government to privatize VSNL. Finally in April 2002, the government decided to cut its stake of 53% to 26% in VSNL and to throw it open for sale to private enterprises. TATA finally took 25% stake in VSNL.[18]
This was a gateway to many foreign investors to get entry into the Indian Telecom Markets. After March 2000, the government became more liberal in making policies and issuing licenses to private operators. The government further reduced license fees for cellular service providers and increased the allowable stake to 74% for foreign companies. Because of all these factors, the service fees finally reduced and the call costs were cut greatly enabling every common middle class family in India to afford a cell phone. Nearly 32 million handsets were sold in India. The data reveals the real potential for growth of the Indian mobile market.[19]
In March 2008 the total GSM and CDMA mobile subscriber base in the country was 375 million, which represented a nearly 50% growth when compared with previous year.[20] As the unbranded Chinese cell phones which do not have International Mobile Equipment Identity (IMEI) numbers pose a serious security risk to the country, Mobile network operators therefore planned to suspend the usage of around 30 million mobile phones (about 8 % of all mobiles in the country) by 30 April.[21] 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 a number of proactive initiatives were taken by regulators and licensors, the total number of mobile subscribers has increased greatly to 617 million subscribers as of May 2010.[7][22]
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$0.15 only. In 2005 alone additions increased to around 2 million per month in the year 2003-04 and 2004-05.
In June 2009, the Government of India banned the import of several mobile phones manufactured in China citing concerns over quality and the lack of IMEI's which make it difficult for authorities in India to track the sale and use of such phones.[23] In April 2010, the Government was also reported to be blocking Indian service providers from purchasing Chinese mobile technology citing concerns that Chinese hackers could compromise the Indian telecommunications network during times of national emergency. A series of attacks on Indian government websites and computer networks by suspected Chinese hackers has also made Indian regulators suspicious with regards to the import of potentially sensitive equipment from China. The companies reported to be affected by this are Huawei Technologies and ZTE.[24][25][26]
LIRNEasia's Telecommunications Regulatory Environment (TRE) index, which summarizes stakeholders’ perception on certain TRE dimensions, provides insight into how conducive the environment is for further development and progress. The most recent survey was conducted in July 2008 in eight Asian countries, including Bangladesh, India, Indonesia, Sri Lanka, Maldives, Pakistan, Thailand, and the Philippines. The tool measured seven dimensions: i) market entry; ii) access to scarce resources; iii) interconnection; iv) tariff regulation; v) anti-competitive practices; and vi) universal services; vii) quality of service, for the fixed, mobile and broadband sectors.
The results for India, point out to the fact that the stakeholders perceive the TRE to be most conducive for the mobile sector followed by fixed and then broadband. Other than for Access to Scarce Resources the fixed sector lags behind the mobile sector. The fixed and mobile sectors have the highest scores for Tariff Regulation. Market entry also scores well for the mobile sector as competition is well entrenched with most of the circles with 4-5 mobile service providers. The broadband sector has the lowest score in the aggregate. The low penetration of broadband of mere 3.87 against the policy objective of 9 million at then end of 2007 clearly indicates that the regulatory environment is not very conducive.[27]
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.[28]
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.[29] 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.[30]
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[31] 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.[32]
On landlines, intra-circle calls are considered local calls while inter-circle are considered long distance calls. Currently Government is working to integrate the whole country in one telecom circle. For long distance calls, the area code prefixed with a zero is dialed first which is then followed by the number (i.e. To call Delhi, 011 would be dialed first followed by the phone number). For international calls, "00" must be dialed first followed by the country code, area code and local phone number. The country code for India is 91.
Telephony Subscribers (Wireless and Landline): 621.28 million (Mar 2010) [33]
Land Lines: 36.96 million (Mar 2010)[33]
Cell phones: 617.53 million (May 2010)[33]
Yearly Cell phone Addition: 178.25 million (Jan-Dec 2009)[33]
Monthly Cell phone Addition: 20.31 million (Mar 2010) [33]
Teledensity: 52.74% (Mar 2010) [33]
Projected Teledensity: 1 billion, 84% of population by 2012.[33]
The Mobile telecommunications system in India is the second largest in the world and it was thrown open to private players in the 1990s. The country is divided into multiple zones, called circles (roughly along state boundaries). Government and several private players run local and long distance telephone services. Competition has caused prices to drop and calls across India are one of the cheapest in the world.[34] The rates are supposed to go down further with new measures to be taken by the Information Ministry.[35] The mobile service has seen phenomenal growth since 2000. In September 2004, the number of mobile phone connections have crossed fixed-line connections. India primarily follows the GSM mobile system, in the 900 MHz band. Recent operators also operate in the 1800 MHz band. The dominant players are Airtel, Reliance Infocomm, Vodafone, Idea cellular and BSNL/MTNL. There are many smaller players, with operations in only a few states. International roaming agreements exist between most operators and many foreign carriers.
India is divided into 23 telecom circles. They are listed below:[36]
Until recently, only the Government-owned BSNL and MTNL were allowed to provide landline phone services through copper wire in India with MTNL operating in Delhi and Mumbai and BSNL servicing all other areas of the country. Private operators such as Touchtel and Tata Teleservices have entered the market however, the primary focus of their business is on the mobile-phone sector. Due to the rapid growth of the cellular phone industry in India, landlines are facing stiff competition from cellular operators. This has forced landline service providers to become more efficient and improve their quality of service. Landline connections are now also available on demand, even in high density urban areas. The breakup of wireline subscriber base in India as of September 2009[update] is given below[37]
Operator | Subscriber base |
BSNL | 28,446,969 |
MTNL | 3,514,454 |
Bharti Airtel | 2,928,254 |
Reliance Communications | 1,152,237 |
Tata Teleservices | 1,003,261 |
HFCL Infotel | 165,978 |
Teleservices Ltd | 95,181 |
All India | 37,306,334 |
The list of eight states (including the metros Mumbai, Kolkata and Chennai in their respective states) with largest subscriber base as of September 2009[update] is given below[37]
State | Subscriber base |
Maharashtra | 5,996,912 |
Tamil Nadu | 3,620,729 |
Kerala | 3,534,211 |
Uttar Pradesh | 2,803,049 |
Karnataka | 2,751,296 |
Delhi | 2,632,225 |
West Bengal | 2,490,253 |
Andhra Pradesh | 2,477,755 |
The total subscriber base for internet users in India is 81 million as of 2009.[38] Internet penetration in India is one of the lowest in the world which is about 7.0% of the population, compared to other nations like United States, Japan or South Korea where internet penetration is significantly higher than in India.[38]
The number of broadband connections in India have seen a continuous growth since the beginning of 2006. At the end of January 2010, total broadband connections in the country have reached 8.03 million.
Broadband in India is more expensive as compared to Western Europe/United Kingdom and United States.[39]
After economic liberalization in 1992, many private ISPs have entered the market, many with their own local loop and gateway infrastructures. The telecom services market is regulated by the TRAI and the DoT, which has been known to impose censorship on some websites.
The current definition of Broadband in India is speeds of 256 kbit/s. TRAI on July 2009 has recommended raising this limit to 2 Mbit/s.[40]
As of January 2010[update], India has 9.24 million broadband users comprising of 6.0% of the population.[41] India ranks one of the lowest provider of broadband speed as compared countries such as Japan, South Korea and France.[10][39]
Because of the increase in Broadband penetration and the quality of service steadily improving, many non-resident Indians are now enjoying the ability to communicate with family in India from around the world. However, many consumers complain that ISPs still fail to provide the advertised speeds - some even failing to meet the 256 kbit/s standards.
The main problem consumers face with High Speed Broadband in India is that they are frequently expensive and/or they have limited amounts of data transfer included in the plan. In fact in one of the developed nations "Canada" 10Mbps and 50GB costs $40 which is higher than Rs.1600 in Indian currency.
Internet Service Providers (ISPs) & Hosts: 86,571 (2004) Source: CIA World FactBook
Country code (Top-level domain): IN
Radio broadcast stations: AM 153, FM 91, shortwave 68 (1998)
Radios: 116 million (1997)
Television terrestrial broadcast stations: 562 (of which 82 stations have 1 kW or greater power and 480 stations have less than 1 kW of power) (1997)
Televisions: 110 million (2006)
In India, only the government owned Doordarshan (Door = Distant = Tele, Darshan = Vision) is allowed to broadcast terrestrial television signals. It initially had one major National channel (DD National) and a Metro channel in some of the larger cities (also known as DD Metro).
Satellite/Cable television took off during the first Gulf War with CNN. There are no regulations against ownership of satellite dish antennas, or operation of cable television systems, which led to an explosion of viewership and channels, led by the Star TV group and Zee TV. Initially restricted to music and entertainment channels, viewership grew, giving rise to several channels in regional languages and many in the national language, Hindi. The main news channels available were CNN and BBC World. In the late 1990s, many current affairs and news channels sprouted, becoming immensely popular because of the alternative viewpoint they offered compared to Doordarshan. Some of the notable ones are Aaj Tak (means Till Today, run by the India Today group) and STAR News, CNN-IBN, Times Now, initially run by the NDTV group and their lead anchor, Prannoy Roy (NDTV now has its own channels, NDTV 24x7, NDTV Profit, NDTV India and NDTV Imagine).New Delhi TeleVision.
Here is a reasonably comprehensive List of Indian television stations.
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 wireless access broadband 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 (419,000 miles) 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 36 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.
Number portability: TRAI announced the rules and regulations to be followed for the Mobile Number Portability in their draft release on 23 September 2009. Mobile Number Portability (MNP) allows users to retain their numbers, while shifting to a different service provider provided they follow the guidelines set by TRAI. Users are expected to holding the mobile number with a given provider for at least 90 days, before they decide to move to the other provider.[51]
As per news reports, Government of India decided to implement MNP from December 31, 2009 in Metros & category ‘A’ service areas and by March 20, 2010 in rest of the country.
It has been postponed to March 31, 2010 in Metros & category 'A' service areas. However, time and time again, lobbying by the state-run firms, BSNL and MTNL has resulted in innumerable delays in the implementation of Mobile Number portability. The latest reports suggest BSNL and MTNL are finally ready to implement the Mobile Number Portability by October 31, 2010.[52]
The incumbent telecom operators (BSNL & MTNL) have maintained several telecom training centres at regional, circle and district level. BSNL has three national level institutions, namely Advanced Level Telecom Training Centre (ALTTC) at Ghaziabad, UP; Bharat Ratna Bhim Rao Ambedkar Institute Of Telecom Training at Jabalpur, MP; and National Academy of Telecom Finance and Management.
MTNL incorporated Centre for Excellence in Telecom Technology and Management (CETTM) in 2003-04. It is the largest telecom training centre in India and one of the biggest in Asia with a capex plan of over Rs. 100 crore . CETTM is situated at Hiranandani Gardens, Powai, Mumbai with built area of 486,921 sq ft (45,236.4 m2). It provides training in telecom switching, transmission, wireless communication, telecom operations and management to corporates and students besides its own internal employees.
Other than the government opearators some private players like Bharti (Bharti School of Telecom Management part of IIT Delhi), Aegis School of Business and Telecommunication(Banglore and Mumbai) and Reliance have started their own training centres.
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