Balaji Institute of Telecom & ManagementPune

Research ReportOn

Researched by:

Vikas Sharma TM 08 - 109Lokesh Gupta TM 08 - 025Rakesh Sonar TM 08 - 091Manish Pandey TM 08 - 027Baijnath Mandal TM 08 - 068Aditya Mahakulkar TM 08 - 062

Specializations: Telecom & ITBatch 2008 - 2010

Submitted to:

Mr. Abhijeet Kumar Singh Mr. Milind M. OkaVisiting Faculty- BITM Director - BITM

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TABLE OF CONTENTS

Chapter 1

Introduction 4

1.1 Summary of Abstract 4

1.2 Objective 5

1.3 Scope of Study 6

1.4 Methodology 6

1.4 Review of literature 7

Chapter 2

2.1 Company profile 8

2.2 Core Business Area 8

2.3 History 10

2.4 Organizational Structure 14

2.5 Products 15

2.6 Market Share 15

2.7 National Coverage 16

2.8 Financial Analysis 16

Chapter 3

3.1 Value Chain 18

3.2 SIPOC 21

3.2 Marketing Strategy 22

3.3 BCG Matrix 23

3.4 5 Force Model 23

3.5 SWOT Analysis 27

3.6 OSS / BSS 28

3.6 OSS/BSS Integration Enablers 31

3.7 Future Perspective 32

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3.8 Our Recommendations 32

LIST OF FIGURES & CHARTS

Figures:

Fig 1 Organizational Structure 15

Fig 2 Products 16

Fig 3 National Coverage 17

Fig 4 Value Chain 18

Fig 5 SIPOC 22

Fig 6 BCG Matrix 24

Fig 7 5 Force model 24

Fig 8 Wireless Market 25

Fig 9 OSS 30

Fig 10 BSS 30

References 35

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CHAPTER 1

INTRODUCTION

ABSTRACT

This document is the Final Research Product for BITM, titled “OVERVIEW OF TELECOM

SERVICES INDUSTRY IN INDIA & ANALYSIS OF BHARTI AIRTEL”.

ABOUT BHARTI AIRTEL

Bharti Airtel is India’s no.1 reliable network, serving at around 88 million voice & data user

subscribers. The need of research study is to study about Bharti Airtel, understanding its

various strategies that keep it ahead of all other competitors like Vodaphone, Idea, Reliance

etc.. This study is undergone through various steps of research project. The method used for the

research project are- Group Discussion, internet browsing, different graphs & chart study etc.

From this analysis we found that Bharti Airtel has the largest market share due to its calling

plans, Tariff plans and other strategies.

Telecom giant Bharti Airtel is the flagship company of Bharti Enterprises.

Bharti Airtel, formerly known as Bharti Tele-Ventures Limited (BTVL).

India's largest and world's third largest cellular service provider.

More than 88 million subscribers as of 31 December 2008.

Airtel provides mobile & fixed wireless services using GSM technology across 23 telecom

circles.

Largest Telecom Company listed on Indian Stock Exchanges.

The company also has a submarine cable landing station at Chennai, which connects the

submarine cable connecting Chennai and Singapore.

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OBJECTIVE

The aim of this research project is to study about different strategies used, different products

used by Bharti Airtel. It also includes Indian market study, Bharti Airtel Corporate Study, its

financial & Industrial study.

The following are the objectives of studying the Indian Telecom leader AIRTEL.

1. To understand the functioning of AIRTEL.

Corporate strategies

Marketing practices

Technologies.

2. To prepare an analysis of the company

SWOT analysis

Marketing analysis

Competitor analysis.

3. To enhance our knowledge about business processes of the company

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SCOPE OF THE STUDY

This study would enable us to understand as to how the companies in the national, international

market function. Also, we can evaluate the company growth in the different-different year and

what was the marketing strategy. It also tells us that, how company work at different places in

same sector.

METHODOLOGY

Viewing the mergers & acquisitions done by the company & predicting its strategy.

Examine the research papers & annual reports published by the company.

Analyzing the information given by the company about their products, available on

company website.

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REVIEW OF LITERATURE

Indian telecom Market Leader AIRTEL is top 5 global players in terms of subscriber base.

Keeping in mind, the fact that a telecom company is among a few industries which is less

affected by recession, we carry out the research. Our interest grew in AIRTEL as it is the largest

TSP in India and also has wide range of products and services.

On our research we have seen that much research on the various products

and services of AIRTEL have been done but AIRTEL as a whole has not been yet analyzed. So

our attempt is to touch upon every aspect of AIRTEL and thereby put forward a macroscopic

view of all its aspects ranging from its history till it’s presence situation, including its services

so as to come to a valid conclusion. SO we have used methods such as

1. Comparison: - Example data such as revenue, profit, users and so on can be

compared with that of previous year and also with competitors. It helps in comparative

evaluation of different aspects of AIRTEL and helps to understand things in a better

way.

2. Charts: - Use of pie charts and bar diagrams to interpret the available data has led to

better and easier understanding of the matter for the readers.

3. SWOT: - Certain managerial tool such as SWOT analysis has also been done to

understand the strong and weak points of its subsidiary. This shows on which factors to

concentrate upon and which factors to leave untouched. It helps to understand the

strategy that the company has adopted.

4. Pictorial Depiction: - For better understanding the core of the matter most of the

facts and figures have been depicted in pictorial form.

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CHAPTER 2

COMPANY PROFILE

Telecom giant Bharti Airtel is the flagship company of Bharti Enterprises.

Bharti Airtel, formerly known as Bharti Tele-Ventures Limited (BTVL).

India's largest and world's third largest cellular service provider.

More than 100 million subscribers as on 31 May 2009.

Airtel brand is headed by Sunil Bharti Mittal .

Airtel provides mobile & fixed wireless services using GSM technology across 23

India’s First Telecom Company that provides telecom services in all the circles.

The company also has a submarine cable landing station at Chennai, which

Company shares are listed on The Stock Exchange, Mumbai (BSE) and The

Per Share price of Airtel in BSE is Rs 840.40 (17 may 2009).

CORE BUSINESS AREA

Mobile Services - We offer mobile services using GSM technology on 900MHz and

1800MHz bands, and are the largest wireless service provider in the country, based on

the

Number of customers. Our 85,650,733 mobile customers accounted for a market

share of 24.7% of wireless market, as on December 31, 2008. We offer post-

paid, pre-paid, roaming and value added services through our extensive sales and

distribution channel covering 1,069,706 outlets. Our network is present in 5,057

census towns and 401,882 non-census towns and villages in India, thus covering

approximately 79% of the country’s population. Our network operating centres,

which monitor the health of our mobile network are located in Gurgaon, near

Delhi, and Chennai.

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Telemedia Services – We provide broadband (DSL) and telephone services (fixed line)

in 95 cities with growing focus on new media and entertainment solutions such as DTH

and IPTV. We had 2,619,461 customers as on December 31, 2008 of which 37.9% were

subscribing to broadband/internet services. Our product offerings in this segment

include supply and installation of fixed-line telephones providing local, national and

international long distance voice connectivity and broadband Internet access through

DSL. We also remain strongly committed to our focus on Small and Medium Business

enterprises .We provide a range of customised Telecom/ IT solutions and aim to achieve

revenue leadership in this rapidly growing segment of the ICT market. The strategy of

our Telemedia business is to focus on cities with high revenue potential, except for DTH

which is an all- India offering. Airtel digital TV is available to customers through

23,200 retail points in 120 cities across the country.

Enterprise Services - Enterprise Services provides a broad portfolio of services to large

Enterprise and Carrier customers. This division comprises the Carrier and Corporate

business units. Enterprise Services is regarded as the trusted communications partner to

India's leading organizations, helping them to meet the challenges of growth.

Carriers – Carrier business unit provides long distance wholesale voice and data

services to carrier customers as well as to other business units of Airtel. It also offers

virtual

Calling card services in the overseas markets. The business unit owns a state of

the art national and international long distance network infrastructure enabling it

to provide connectivity services both within India and connecting India to the

world. The national long distance infrastructure comprises of 90,205 kms of

optical fibre, over 1,500 MPLS and SDH POPs and over 1,250 POIs with the

local exchanges, providing a pan India reach. The international infrastructure

includes ownership of the i2i submarine cable system connecting Chennai to

Singapore, consortium ownership of the SMW4 submarine cable system and

investment in capacities across a number of diverse submarine cable systems

across transatlantic and transpacific routes.

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Corporate – This business unit delivers end to end telecom solutions to India’s large

corporate. It serves as the single point of contact for all telecommunication needs for

corporate customers in India by providing full suite of communication services across

data, voice and managed services. It specializes in providing customized solutions to

address unique requirements of different industry verticals; BFSI, IT, ITeS,

Manufacturing and distribution, media, education, telecom, Government and PSUs and

retail among others. Backed by the alliances with leading technology companies

worldwide and state of the art infrastructure, it offers complete range of telecom

solutions. These solutions enable corporate to network their offices within India and

across the globe, provide them infrastructure to run business critical applications and

provide them means to connect with their customers, vendors and employees.

Passive Infrastructure Services – Bharti Infratel provides passive infrastructure

services on a non-discriminatory basis to all telecom operators in India. Bharti Infratel

deploys, owns and manages passive infrastructure on an all India basis. The company

had approx 61,355 towers as on December 31, 2008, out of which 35,066 towers would

be transferred to Indus Towers Ltd (a Joint Venture between Bharti Infratel, Vodafone

& Idea Cellular). An Indus tower has built 10,433 towers during April 2008 to

December 2008.

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HISTORY

Bharti Tele-Ventures was incorporated on July 7, 1995 as a company with limited liability

under the Companies Act, for promoting telecommunications services. Bharti Tele-Ventures

received certificate for commencement of business on January 18, 1996. The Company was

initially formed as a wholly-owned subsidiary of Bharti Telecom ltd.

The chronology of events since Bharti Tele-Ventures was incorporated in 1995 is as follows:

Calendar year & Events

1995

Bharti Cellular launched cellular services'AirTel'in Delhi

1996

STET International Netherlands NV, or STET, a company promoted by Teleco

Italia, Italy acquired a 20% equity interest in Bharti Tele-Ventures.

Bharti Telenet launched cellular services in Himachal Pradesh.

1997

Bharti Telenet obtained a license for providing fixed-line services in Madhya

Pradesh circle

Bharti Telecom and British Telecom formed a 51% : 49% joint venture, Bharti BT,

for providing VSAT services

1998

First Indian private fixed-line services launched in Indore in the Madhya Pradesh

circle on June 4, 1998 by Bharti Telenet thereby ending fixed-line services monopoly

of DoT (now BSNL)

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1999

Bharti Tele-Ventures (by acquiring a 63.45% equity interest in SC Cellular Holdings)

acquired an effective 32.36% equity interest in Bharti Mobile (formerly JT Mobiles),

the cellular services provider in Karnataka and Andhra Pradesh circles

New York Life Insurance Fund, or NYLIF, acquired a 3% equity interest in Bharti

Cellular

2000

Bharti Tele-Ventures acquired an effective equity interest of 40.5% in Bharti

Mobinet (formerly Skycell Communications), the cellular services provider in

Chennai

Bharti Tele-Ventures acquired a 30.2% equity interest of Telecom Italia in Bharti

Telenet and 18.8% from Bharti Telecom thereby making Bharti Telenet a 100%

Subsidiary of Bharti Tele-Ventures

SingTel (through its investment company Pastel Limited) acquired STET's 15.3%

equity interest in Bharti Tele-Ventures

2001

Bharti Telesonic entered into a joint venture, Bharti Aquanet, with SingTel for

establishing a submarine cable landing station at Chennai.

Bharti Cellular acquired a 100% equity interest in Bharti Mobitel (formerly Spice

Cell), the cellular services provider in Kolkata.

Bharti Tele-Ventures acquired 85% and 15% in Bharti Telespatial from Bharti

Telecom and Intel, respectively.

Bharti Tele-Ventures acquired a 44% equity interest in Bharti Cellular from British

Telecom, thereby making Bharti Cellular its 100% subsidiary.

Bharti Telenet entered into license agreements to provide fixed-line services in the

Haryana, Delhi, Tamil Nadu and Karnataka circles

Bharti Telesonic entered into a license agreement with the DoT to provide national

long distance services across India.

Bharti Telenet launched fixed line services in Haryana under the brand name of

TouchTel.

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2002

Issue price fixed at Rs 45 per share, floor price fixed by the company. Raises Rs 834cr

Shares listed on BSE and NSE opens at 11% premium to its issue price of Rs 45.

Enters into a 5-year agreement with Escotel and ETL of the Escorts group to contract

leased line connectivity for its cellular operations.

ICICI Bank ties up with Bharti for pre-paid mobile cards via ATMs.

Sunil Mittal, Chairman & Managing Director of the company, bags Businessman of

the year award by Business India.

2003

Airtel breaks interconnectivity with Tata Teleservices in Andhra Pradesh Circle.

Air Tel launches Local direct dialling facility in Chennai circle.

Mobilises 5 m long term foreign currency borrowings for expansion of cellular

operations

Bharti Cellular unveils CareTouch service.

Punjab, Haryana get free incoming calls from Airtel.

AirTel provides SMS facilities to hearing impaired in Chennai

Goa, Maharashtra gets 'voice portal' services by Bharti Cellular.

AirTel mobile service in Chennai, today launched its GPRS (General Packet Radio

Service) network and an MMS (multi-media messaging) on the GPRS platform

Airtel surpasses 4 lakh subscriber base in Karnataka

2004

Bharti unveils new card for Mecca piligrims

AirTel enrolls 50,000 customers in its mobile service in 60 days

Launches WAP enabled portal Service in Kerala

Bharti Cellular's AirTel has extended its mobile connectivity to Karaikkal, Nagur,

Mannargudi and Kovilpalayam in Tamil Nadu circle.

Samsung India Electronics Limited has tied up with cellular operator Bharti for

bundling its mobile handsets with a connection.

Airtel launched two-way international roaming and GPRS for prepaid customers in

the Maharshtra and Goa circles

2005

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Airtel launches video services for its GPRS customers on February 22, 2005

Airtel unveils new TV ad featuring Sachin, Sharukh

Bharti Tele-Ventures launches telecom network in Andaman & Nicobar

BTVL unveil fixed line, broadband services

Bharti inks 5-m deal with Nokia for rural network expansion

Bharti Tele Ventures - Airtel introduces BlackBerry Connect in India.

Bharti Tele Ventures announces agreement with Vodafone.

2006

Airtel unveils Re 1 STD plans

Airtel sets up customer centre

Sunil Mittal bags CEO of the Year award.

Cellebrum join hands with Airtel.

Airtel Mega unveiled in Coimbatore

Airtel joins hand with Microsoft.

2007

Bharti Airtel, telecom major, has come out with a slew of initiatives including buying

out SingTel's 50 per cent stake in joint venture under sea cable company Network i2i.

Bharti Airtel Ltd has announced the following changes in the operational leadership

Structure and roles in the Company effective April 01, 2007.

Airtel signs agreement with HTC for touch screen mobile.

ORGANIZATIONAL STRUCTURE

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FIG 1

15

FIG 2

MARKET SHARE:

CHART 1

NATIONAL COVERAGE:

16

FIG 3

FILANCIAL ANLALYSIS:

(Revenue in US mn $)

Investor Relations: - http://www.bhartiairtel.in

CHART 2

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VALUE CHAIN- BHARTI AIRTEL

CHART 3

CHAPTER 3

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BSNL3542229%

Airtel2654622%

Reliance1922715%

Vodafone1548012%

Tata Commn82047%

Idea67205%

MTNL47004%

TTSL50024%

Othes32003%

REVENUE in Cr. RS

BSNL

Airet

Reliance

Vodafone

Tata Commn

Idea

MTNL

TTSL

Othes

VALUE CHAIN

FIG 4

OEM 1: Stands for original equipment manufacturers level 1.

INTEL

OEM 2: Stands for original equipment manufacturers level 2.It comprises basically the networking

elements vendors like switches, routers and gateways.

CISCO

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EV: Stands for equipment vendor.

NOKIA

ERRICSON

HUWAEI

NI: Stands for network integrator and the operation areas are to integrate the network elements to

have a fault tolerant network infrastructure.

NO: Stands for network operators. It the basic infrastructure company.

BHARTI INFRATEL

INDUS TOWER

SP: Stands for service provider.

AIRTEL

MVNO: Stands for mobile virtual network operator. Depending upon the infrastructure they are

owning they are further classified into Full or Partial MVNO. They do not own the infrastructure or

the service rather they leverage upon their brand names.

SI: Stands for the system integrator. They have product as well as domain knowledge.

ISV: Stands for independent software vendor. They are the original developer of the software

packages.

IBM

ASP: Stands for application service provider. Organizations that host software applications on own

servers within own facilities.

INFOSYS

3PAP: Stands for 3rd party application provider. There are value added reseller and do not have

permanent contract with either service provider or the system integrator.

AFFLE

EU: Stands for the end user. The final entity who consumes the services.

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SUBSCRIBER

CORPORATE

CA: Stands for the content aggregator. They basically do the conversion work of information into

required protocol suit.

ON MOBILE

INDIA TIMES

HUNGAMA MOBILE

CP: Stands for content provider. They are the information supplier.

MAUJ ONE 97

IMI MOBILE

SIPOC- BHARTI AIRTEL

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There are 5 steps in the SIPOC process.

1. Supplier

2. Inputs

3. Process

4. Outputs

5. Customers

FIG 5

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MARKETING STRATEGY

Core Value Of Airtel

• Performance

• Dynamism

• Leadership

Targeting –

• Elite

• Up market professionals

• Entrepreneur with business plans

• Low income mass category

• Youth

• Women and senior citizens by post paid connection

Advertisement-

Airtel basically uses two appeals to connect to the users

• Emotional

• Humorous

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BCG MATRIX-

FIG 6

5 FORCE MODEL

FIG 7

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1. Threat from Competition (High)

FIG 8

2. Customer Bargaining power(High)

Lack of differentiation among Service Providers

Cut throat Competition

Low Switching Costs

Number Portability will have –Ve Impact

Businesses & Consumers.

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3. Supplier Bargaining power (Low)

4 Threats of Substitutes (High)

Landline - Outdates

CDMA

Video Conferencing - Broadband services

VOIP - Skype, Gtalk, Yahoo Messenger

e-Mail & Social Networking Websites

5 Threat of new Entrants (Low)

Huge License Fees to be paid upfront & High gestation period

Entry of MVNOs & WiMAX operators

Spectrum Availability & Regulatory Issues

Infrastructure Setup Cost - High

Rapidly changing technology

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SWOT ANALYSIS

Strength

• Market Leader

• Recognized Globally

• Strong Brand Image

• Strong New Business Development team

• Strong Financials

• Largest Telecom Player 22.6%

Weakness

• Outsourcing of core system

• Network Coverage

Opportunities

• Low Broadband Penetration, Rural

• Telephony

• Bharti Infratel – Cutting Down cost in rural area

• Current Tele-Density – 30.6 is still low among developing countries

Threats

Falling ARPU

Intense Competition & Shortage of Bandwidth

New Players coming in India

Uncertain Economic Condition

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OSS/BSS

OPERATION SUPPORT SYSTEM / BUSSINESS SUPPORT SYSTEM

Airtel systems architecture consists of three layers:

1. Business Support System (BSS) layer

2. Operations Support System (OSS) layer

3. Networks layer

In addition to these traditional layers, integration enablers are needed to provide

the ability to successfully interconnect OSS and BSS.

The BSS layer has a focus towards customers and business partners. The BSS also

manages most of the financial transaction processing as well as act as a front-end

towards the end-users of the systems.

The OSS layer contains the infrastructure for technical network management. The OSS

systems are built around product, service and resource inventories.

The networks layer contains the network operator’s network infrastructure. Multiple

networks can be managed simultaneously by one system.

The OSS and BSS systems should communicate using integration enablers in order

to maximize application plug ability and overall solution flexibility.

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OSS provides components, such as

Topology – Network and service topology component.

Inventory – Network and service inventories.

Service activation – Component for interfacing towards different service directories

and retrieving activation context.

Network activation – Abstraction service utilizing needed specific service components

Fault management – Component for alarm monitoring and processing for network

elements.

Performance management – Component for performance data collection,

KPI calculation and reporting

Business Process Engine (BPE) – Managing OSS sub-processes (such as service

deployment) which are integrated to higher-level business processes.

BSS layer

A self service (web) portal, where the subscriber is able to manage his subscription

and activate new services and deactivate unwanted ones:

Customer Relationship Management (CRM) system

Order management

Subscriber management

Pricing and rating information

Charging & billing system

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OSS:

BSS:

FIG 9 & 10

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AIRTRL OSS BSS INTEGRATION ENABLERS

The integration enablers consist of the integration technology platform (OSS and IT

middleware), with both generic framework and OSS/BSS-specific abstraction services,

which are accessed through standard APIs when possible (please refer to the picture below).

OSS/BSS integration enablers in brief:

OSS/BSS and OSS Access APIs provide standard interfaces towards OSS applications

and middleware software components to enable simple OSS/BSS integration. APIs are

mainly based on the OSS/J, when a standard interface exists.

Custom API toolkits (e.g. EAI tools) are used for integrating systems without

standard interfaces

Standard OSS middleware provides the generic framework and OSS specifi c

abstraction services such as Service inventory and Service activation.

Standard IT middleware, such as J2EE container and database.

Standard service management interfaces (e.g. Web Services)

BSS:

IBM Daksha, Mphasis, Teletech, HTMT handles call center outsourcing for AIRTEL.

IBM Daksha handles and control customer care of AIRTEL.

TCS is providing BILLING solution of AIRTEL.

OSS:

ALCATEL LUCENT handles the network management part of AIRTEL.

NORTEL handles performance management.

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FUTURE PERSPECTIVE:

Concentration on Rural Market Penetration.

3G Deployment.

Become Market Leader on Internet / Broadband.

Become Market Leader on DTH and IPTV.

Emerge as Global Telecom Player.

Benchmark for the other telco’s.

Defend the market Share.

Increase subscriber Base upto 200 mn till 2013.

Merger and acquisitions.

OUR RECOMMENDATION:

The teledensity in urban and rural india is not that much high as compare to other

countries like china, US.

The opportunity for Airtel to Penetrate the market.

The Internet Broadband user is also very low, so there is good opportunity to penetrate

the market.

DTH is emerging Technology, so it should much concentrate on marketing of DTH.

SO many new players are entering in to the indian telecom market, so much

concentration should be defend the market share and leadership.

Approximately 10 percent of revenue comes from Value added services, so should be

try to increase it.

Merger and acquisition should take place, for entering into global market.

REFERENCES

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WEB SITES

http://www.bhartiairtel.in .

http://capitaline.com .

www.pluggd.in .

www.analysismason.com .

www.payin2.com

www.ibef.org

www.shop.informatm.com

www.wikipedia.com/airtel

www.telecomfourm.com

MAGZENES:

Voice and Data.

Tele.net

Telecom ERA.

Telecom Asia.

REPORTS:

IMRB Research reports.

Investors presentation, Bharti Airtel Limited, November 2008

Analyst Report – Bharti Airtel, Assist C. Mehta Investments Intermediates Ltd.

Telecommunication Sector Report – March 2008, CRISIL.

Telecommunication Services, Indian Industry: A Monthly Review, CMIE – November 2008

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