Project Telecommunications

8/14/2019 Project Telecommunications

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The worldwide telecom industry is in a strong growth mode. In fact, telecommunications hasbeen one of the most dynamic industries in terms of rapid technology advancementcombined with deregulations. The industrys overall revenue is estimated to be over $1.3trillion (2007). A few well-known names in the telecom sector are Sprint, Cable & Wireless,Telstra, AT&T, China Telecom and Reliance Communications. These companies and several

other similar industries are conventionally known as Communication Service Providers (CSPs). They cater to a wide variety of cross sectional industry sectors be it IT, Bio-technology, Health Care, Manufacturing and even a residential consumer.

SAP leverages its solutions for CRM, asset life cycle management, supply chainmanagement and financials to address the business needs. Built-in adapters connect all SAPmodules to enable users to extract the data needed to accomplish their respectiveprocesses. If necessary, SAP also offers open-ended integration tools with other systems toconnect and complete the processes.

A customer life cycle process in a telecom industry can be broadly classified as Pre-Sales,

Sales, Order Administration & Provisioning, and Customer Support.

All individual sub-functions can be grouped into each of the above processes to understandthe requirement of IT tools / technology to effectively carry out the process. Dependingupon the business strategy and positioning, typically Pre-Sales starts with campaigns andextends up to identifying prospective customers. However, telecom products are unique andneed to be bundled / configured to meet each customer requirement. Quotes will need to beworked by a technical team. Upon the customer confirming the order, the provisioning teamworks on order fulfillment and customer acceptance. They will give the necessary inputs tothe billing team to complete the billing process.

Then the customer support team takes over and makes itself available for any supportrelated issues / queries. Each of these processes will need robust tools to capture, share,and for timely analysis of technical / business data to effectively carry out the businessfunctions. Multiple IT systems to meet the needs will add to the performance andmaintenance issues.

While the business process of each company varies with the business strategy and productpositioning, SAP captures the best business practice across the industry. SAP alsorecommends implementing its ERP as much out-of-the box as possible to leverage the bestpractice. This will enable quicker ROI to companies and easy to maintain or upgrade theapplication later. The business process explained above relates to the best practiceapproach for a CSP. Each business function, however, needs to be broken down into specificunits.

The customer has a choice of accessing through the Web, email, phone, partner or fieldrepresentative. During this prospecting process, SAP unifies multiple channels throughwhich the customer can access, thereby enabling sales or marketing personnel to get a 360-degree view of the customer. This sharing of prospect or customer information is extremelyimportant from the point of view of new client acquisition. In addition to effectively


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capturing the customer needs using the SAP CRM module, during proposal building stage,each service can be combined or bundled with other products and sub-services.

This is where SAPs product configuration and bundling come in handy. Price calculation canbe done faster using the pricing engine. This flexibility reduces the time to market and

addresses customer needs uniquely. Following the quote stage, once the customerconfirmation is received, contracts or agreements can be captured in SAP and orderprocessing commenced. Order types could vary among New / Change / Cancel / Add-on.Each order type can be processed as per the data required and associated workflows. Theorder status can then be tracked and once completed, the customer, service and contractdata will be sent to billing. The modules are integrated on the same SAP platform and hencereduce redundancy.

In terms of customer support function, issues can be broadly categorised into Networktrouble tickets and Customer trouble tickets. The former is created by CSPs themselveswhen there is a network outage and multiple customers on the network get affected.

Customer trouble tickets are those where there is a fault for a specific customer. In eithercase, SAP CRM service module can address the issues and track the complete trouble ticketcycle.

SAP also equips field service engineers with the knowledge base, based on historicalresolution cases. This will enable quicker resolutions and easier adaptability for new serviceengineers. In case companies are looking for spare parts planning SAP has ready modulesto cater to.

With its rich functionality, SAP supports end-to-end business processes for a customer-centric organisation. SAP solution maps recommend the best practice approach to meet the

varying demands of the industry and help companies to stay competitive in one of the mostdynamic markets.

The author is Principal Consultant of SAP practice with MindTree Consulting Limited,Bangalore.


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2)

The global economic downturn has forced companies across the globe including Indiancompanies to adopt various cost-cutting measures to sustain their bottom line. However, Indiancompanies seem to be a step ahead when it comes to thinking ahead. SAP Indian sub-continent

managing director Ranjan Das shares his insights on how India stands differently in the times of slowdown. He highlights some of the changing trends in enterprise mobility space and telecom

sector, and goes on to clarify the SAP/ERP ambiguity, in an interview with FE's AyushmanBaruah

What are the challenges faced by companies globally? Do you perceive India any differently?

The global credit crunch has impacted all companies globally, including India. The segment thathas been hit hardest, especially in India, is the SME sector. Given that the revenues are goingdown for most companies, everyone wants to trim costs. But the key difference lies in the fact

that, in addition to cutting costs, Indian companies are also thinking ahead. Most Indiancompanies are already taking this as an opportunity to leapfrog the competition because there

would be new things and newer business models when the good times are back. Most companiesin India are really interested in adopting best practices. The next set of best practices is likely to

come from India.

What are the changing trends in the enterprise mobility space?

The enterprise mobility space is certainly one of the hot spots. As enterprise mobility usingsmartphones becomes a business necessity, SAP and Research In Motion (RIM) are working toaddress the needs and expectations of business users through an integrated solution that enablessecure real-time access to SAP's Customer Relationship Management solution. The integrated

solution benefits organisations with enhanced employee productivity and service whileempowering mobile users with the ability to access critical customer information. The integrated

solution also leverages the inherent security, management capabilities and efficiency of theBlackBerry Enterprise Solution and introduces a number of key innovations for mobile CRM.

What are technology trends in the telecom space

There is an increasing demand for enterprise-wide business solutions for sustained growth in thetelecom sector. SAP is leading the foothold in the market owing to its diverse and flexible

solution portfolio. Eight of the top 11 telecommunications service providers comprise of SAP'scustomer base. This includes TTSL, BSNL, Vodafone, among others. Fundamentally, all

telecom companies are building an IT platform in order to achieve more efficiency, adopt best practices from other telecom companies and be able to enter new markets, businesses and business models. In terms of technology, the trend points towards adoption of enterprise

applications like Enterprise Resource Planning, CRM, Billing and Provisioning, etc.

How do you react when the terms SAP and ERP are used interchangeably?

SAP is a business software company that does three things. It automates and optimises business processes, offers best practices, and gives you the tools and the data to make decisions. In many

years that I have been with the company, I have never seen SAP as an ERP-only company.


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Evidently, ERP is a very important part of our portfolio but SAP does not equal ERP. ERPusually focuses on functions like finance and HR. But SAP does all that and more. It is involved

in optimising your relationship with your supply chain partners; customer relationshipmanagement; governance and risk and compliance issues.

Which are your current focus areas?

Banking, financial services and insurance and utilities sector require a lot of automation in order to efficiently run their businesses. We are also working for public sector including the local, state

and well as the defence.

3)

What are the changing trends in the enterprise mobility space?

The enterprise mobility space is certainly one of the hot spots. As enterprise mobility usingsmartphones becomes a business necessity, SAP and Research In Motion (RIM) are working toaddress the needs and expectations of business users through an integrated solution that enablessecure real-time access to SAPs Customer Relationship Management solution. The integratedsolution benefits organisations with enhanced employee productivity and service whileempowering mobile users with the ability to access critical customer information. The integratedsolution also leverages the inherent security, management capabilities and efficiency of theBlackBerry Enterprise Solution and introduces a number of key innovations for mobile CRM.

What are technology trends in the telecom space

There is an increasing demand for enterprise-wide business solutions for sustained growth in thetelecom sector. SAP is leading the foothold in the market owing to its diverse and flexiblesolution portfolio. Eight of the top 11 telecommunications service providers comprise of SAPscustomer base. This includes TTSL, BSNL, Vodafone, among others. Fundamentally, alltelecom companies are building an IT platform in order to achieve more efficiency, adopt best

practices from other telecom companies and be able to enter new markets, businesses and business models. In terms of technology, the trend points towards adoption of enterpriseapplications like Enterprise Resource Planning, CRM, Billing and Provisioning, etc.

How do you react when the terms SAP and ERP are used interchangeably?

SAP is a business software company that does three things. It automates and optimises business processes, offers best practices, and gives you the tools and the data to make decisions. In manyyears that I have been with the company, I have never seen SAP as an ERP-only company.Evidently, ERP is a very important part of our portfolio but SAP does not equal ERP. ERP

usually focuses on functions like finance and HR. But SAP does all that and more. It is involvedin optimising your relationship with your supply chain partners; customer relationshipmanagement; governance and risk and compliance issues.


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SAP LAP ANALYSIS OF NATIONAL TELECOM POLICY:INDIA

Priyanka Kokil and M.K.Sharma


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ABSTRACT

Telecom services started in India in 1984 with an infrastructure which performed poor. The telecom sector suffers from high prices, long waiting time, poor technical performance, widespread equipment outage, excess labor, low productivity, chronic unmet demand, and rampant corruption. This has been a significant drag on economic

growth and development of India since telecom is a strategic sector. Although the services started in 1984, it was only after 1991 the crisis-driven liberalization of the economy that the sector was taken seriously.The Government of India recognizes that provision of world classtelecommunication infrastructure and information is the key to rapid economic and social development of India. It was also recognized that this sector contributed a major part in GDP of the county. So, it wasimportant to see the importance to the country that to be comprehensiveand looking forward telecommunications policy which creates a good

framework for the development of the country. To make the telecom service an integrated part, government introduced a National Telecom Policy (NTP) in 1994 but this policy was not able to fulfill all the

requirements so, government again revise the NTP94 and introduced anew National Telecom Policy (NTP) in 1999. This paper is to analyze theevolution, cause etc. of NTP94, NTP99 and NTP (2005-2006) by using SAP LAP framework we do analysis with SAP and understand through

LAP as to what were the various push and pulls which resulted in the NTP99.The question framework contributes to learning and improved decision making.

INTRODUCTION

India is the fourth largest telecom market in Asia after China, Japan and South Korea.The Indian telecom network is the eighth largest in the world and the second largest amongemerging economies. At current levels, telecom intensiveness of Indian economy measured asthe ratio of telecom revenues to GDP is 2.1 percent as compared with over 2.8 percent indeveloped economies. Indian telecom sector has undergone a major process of transformationthrough significant policy reforms. The reforms began in 1980s with telecom equipmentmanufacturing being opened for private sector and were later followed by National Telecom Policy (NTP) in 1994 and NTP'1999 .

Historically, the telecom network in India was owned and managed by the Governmentconsidering it to be a natural monopoly and strategic service, best under state's control. However,in 1990's, examples of telecom revolution in many other countries, which resulted in better

quality of service and lower tariffs, led Indian policy makers to initiate a change process finallyresulting in opening up of telecom services sector for the private sector.

Policy reforms can be broadly classified in three distinct phases The Decade of 1980's saw private sector being allowed in telecommunications equipment

manufacturing. Mahanagar Telephone Nigam Limited (MTNL) and Videsh Sanchar NigamLimited (VSNL) were formed and a Telecom Commission was set up to give focus totelecommunications policy formation.
http://www.iimahd.ernet.in/ctps/pdf/ntp1994.pdfhttp://www.iimahd.ernet.in/ctps/pdf/ntp1994.pdfhttp://www.iimahd.ernet.in/ctps/pdf/NTP1999.pdfhttp://www.iimahd.ernet.in/ctps/pdf/NTP1999.pdfhttp://www.iimahd.ernet.in/ctps/pdf/ntp1994.pdfhttp://www.iimahd.ernet.in/ctps/pdf/ntp1994.pdf


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In 1990s, telecommunications sector also benefited from the general opening up of theeconomy. NTP 1994 was the first attempt to give a comprehensive road map for the Indiantelecommunications sector.

Availability of telephones on demand (targeted by 1997) Universal service covering all villages and one PCO per 500 persons in urban

areas at the earliest (targeted to be achieved by 1997) Telecom services at affordable and reasonable prices World standard quality of services

NTP 1999 brought in the third generations of reforms in the Indian telecommunicationssector.

The Government of India (Government) recognizes that provision of world classtelecommunications infrastructure and information is the key to rapid economic and socialdevelopment of the country. It is critical not only for the development of the InformationTechnology industry, but also has widespread ramifications on the entire economy of the

country. It is also anticipated that going forward, a major part of the GDP of the country would be contributed by this sector. Accordingly, it is of vital importance to the country that there be acomprehensive and forward looking telecommunications policy which creates an enablingframework for development of this industry.

The Indian telecommunications sector has undergone a major process of transformation because of significant policy reforms during the recent years. It has been reported in the pressthat the Department of Telecommunications (DoT) has formulated its perspective plan for telecommunications from 1997 through 2007. This is the first perspective plan after 1994'sTelecom Policy, and follows the earlier one drawn up in 1989 for the period 1990-2000. DoTwill introduce ISDN (Integrated Services Digital Network -a communications standard thatcovers voice, data and image services) up to all district head-quarters by 2007. But before that, it

will start introducing IN (Intelligent Network-services from 1997 in all towns with a populationabove 0.5 million. DoT will also introduce voice response and recognition services by 1997, andseveral multimedia services such as video-on-demand, remote diagnostics and interactive tele-education by 2000. Under the Ninth five-year Plan a number of new initiatives like introductionof Package Tendering and Solar Battery systems, instructions to all the circles to have AnnualMaintenance Service contracts, setting up MARR repair center have been introduced to provideVillage Public Telephones (VPTs) to all villages. Today in rural areas the economy is muchlower than that in urban areas; the telephone traffic is mainly confined to villages that are close

by or to villages within the same telecom center itself. It is obvious therefore that unless and untiltelephone service is made available in all the villages, it is difficult to expect higher calling ratesand better traffic loading. Long distance calls revenues are less and hence phones are far less to

justify the provision of rural telephone service and consequently the service has to be subsidized.This is a heavy burden on the exchequer. The New Telecom Policy, 1999 focused on creating anideal environment for investment, establishing communication infrastructure by leveraging ontechnological development and providing affordable telecom services to all. It had certainimportant objectives, including availability of telephone on demand, provision of world classservices at reasonable prices, ensuring Indias emergence as major manufacturing / export baseof telecom equipment and universal availability of basic telecom services to all villages. It alsoannounced a series of specific targets to be achieved by 1997. As against the NTP 1994 target of

provision of 1 PCO per 500 urban population and coverage of all 6 lac villages, DoT has


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achieved an urban PCO penetration of 1 PCO per 522 and has been able to provide telephonecoverage to only 3.1 lac villages. As regards provision of total telephone lines in the country,DoT has provided 8.73 million telephone lines against the eighth plan target of 7.5 million lines.

Until 1985, the Indian Telegraph Act of 1885 and the Wireless Telegraph Act of 1932 provided the legal basis for the central government's telecommunications monopoly. Under these

laws, posts and telecommunications were combined in one P&T department run by the Ministryof Communications. In the late 1970s and early 1980s protests against poor service bysubscribers, politicians, industrialists, and business leaders coincided with global and national

pressure for liberalization. As a result, a parliamentary committee was established in 1981, whichrecommended numerous structural and service improvements. Under the advice of thiscommittee, in 1985 a separate Department of Telecommunications (DoT) was established under the Ministry of Communications, and two supposedly autonomous public sector (MTNL andVSNL) undertakings (PSUs) were created to expand, develop, and manage crucial segments of the Indian telecommunications system.

The Mahanagar Telephone Nigam Limited (MTNL) was set up to run services in Delhi(the nation's capital) and Mumbai, formerly Bombay (the nation's commercial center),

which together account for 25 percent of the nations phone lines. Telecommunication in the rest of the country continues to be run as a government

department because of staff resistance to change. Videsh Sanchar Nigam Limited (VSNL) was set up to run international services. DoT was established as the exclusive, self-regulating provider of domestic and long-

distance service.

From [1] 1992-1996, DoT doubled practically every aspect of the telecommunicationsinfrastructure in India, from the number of telephones in service to the long distance routekilometers. DoT did not, however, succeed in reducing the registered waiting list for telephones,and in 1994, the government acknowledged the need to liberalize Indias telecommunicationsmarket.

The National Telecom Policy (NTP) of 1994 provided the basis for liberalizing thetelecommunications market. It recognized the importance of liberalization and private sector

participation as key elements of economic development. It also envisaged, among other things,the provision of basic telephone service by private companies that would compete with DoT; theestablishment of an independent regulatory body; and the separation of DoTs operational,

policy, and ministerial functions.

The NTP has led to various liberalization successes. However entrenched bureaucracy,inefficient lobbying and poor public information campaigns have largely undermined the policydomestically, and demand for telephone lines in India remains extremely high. On the

international front, the NTP has prevented India from making more liberal commitments to theWTO. India has refused to go beyond the NTPs very limited policies in making commitments tothe WTO Basic Telecommunications Agreement.

The NTP provides that: DoT will not be corporatized, which ensures that labor unions have no big issue to fight;


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Private sector companies will be issued licenses for statewide operations in competitionwith DoT for basic telephones. This establishes a duopoly system for 15 years in 21statewide service areas (or circles);

Mobile telephone services will be offered solely by non-DoT private sector companies, atleast two in each service area. The initial license period is 10 years, extendable thereafter

in five-year increments; Foreign equity participation will be allowed in public telephone operations of at least

500,000 basic telephone customers and 100,000 mobile phone customers; Private carriers must commit to public service obligations such as rural area coverage and

public telephones; Interstate and international telecommunications will be the exclusive monopoly of DoT

and its company VSNL.

Significant changes have taken place in the telecommunications policy and market inIndia in the last few years, and particularly in the last two years. Favorable government policiesand lower costs have now created a platform for rapid growth. Tele-density, which was around3% at the end of 1997, is about to touch 6%, and expected to reach 10% by 2006 - more than a100 million telephone connections. As in other markets, this is being driven by dramatic growthin cellular phone usage. For instance in the month of October 2003, India added more than 2million cellular (GSM+CDMA) users, making it one of the fastest growing telecom markets inthe world.

In order to speed up the development of the telecom sector, all telecom services have been opened up to private sector participation. Unrestricted entry is allowed in the basic services,national and international long distance service, in global mobile personal communication bysatellite (GMPCS) service, VSAT and Public Mobile Radio Trunked Service (PMRTS).

India is among the top ten countries in the world in terms of its telecommunications

network. The country has an investment potential estimated at US$ 37 billion by 2005 and US$69 billion by 2010.

The new range of telecom services at affordable prices introduced by Reliance Info com,a sister company of India's largest Reliance Industries group, towards the end of 2002 havefurther galvanized the growth potential of telecom market.

India has 38.44 million fixed telephone connections, growing at 22 per cent per annumand almost 10.0 million cellular phone connections, growing at 100 per cent per annum. Thetelecom network in the country comprises over 35,000 exchanges with switching capacity of over 47 million, 427 digital trunk automatic exchanges, and over 326,271 route km of optic fiber network.

In addition to the two state-owned companies BSNL and MTNL, several private playershave established a significant presence in both the basic and cellular markets. Global majors witha presence in the country include Hutchison, Singapore Telecom, AT&T, France Telecom, etc.

The total inflow of FDI into the sector between August 1991 and October 2002 wasaround US$ 1.95 billion.

The Government recognizes that the result of the privatization has so far not been entirelysatisfactory. While there has been a rapid roll out of cellular mobile networks in the metros andstates with currently over 1 million subscribers, most of the projects today are facing problems.


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The main reason according to the cellular and basic operators has been the fact that the actualrevenues realized by these projects have been far short of the projections and the operators areunable to arrange financing for their projects and therefore complete their projects. Basic telecomservices by private operators have only just commenced in a limited way in two of the six circleswhere licenses were awarded. As a result, some of the targets as envisaged in the objectives of the NTP 1994 have remained unfulfilled. The private sector entry has been slower than what wasenvisaged in the NTP 1994.

The government views the above developments with concern as it would adversely affectthe further development of the sector and recognizes the need to take a fresh look at the policyframework for this sector.

Need for a New Telecom Policy

In addition to some of the objectives of NTP 1994 not being fulfilled, there have also been far reaching developments in the recent past in the telecom, IT, consumer electronics andmedia industries world-wide. Convergence of both markets and technologies is a reality that isforcing realignment of the industry. At one level, telephone and broadcasting industries areentering each others markets, while at another level; technology is blurring the difference

between different conduit systems such as wire line and wireless. As in the case of mostcountries, separate licenses have been issued in our country for basic, cellular, ISP, satellite andcable TV operators each with separate industry structure, terms of entry and varying requirementto create infrastructure. However this convergence now allows operators to use their facilities todeliver some services reserved for other operators, necessitating a re look into the existing policyframework. The new telecom policy framework is also required to facilitate Indias vision of

becoming an IT superpower and develop a world class telecom infrastructure in the country.

Licensing of Cellular Mobile Services

Starting in December 1991 the government followed a policy of issuing a limited number of Cellular Mobile and Basic Fixed Service licenses through a process of competitive bidding.

The use of auctions appears to have been motivated by the desire to raise revenues as well asensure transparency in allotment of licenses. However, once the licenses had been granted thewinning bidders, other than those for Metros, complained that they had bid extremely highamounts and that their businesses were not viable. The government then relieved them of theobligation to pay further installments of their committed license fees and allowed them to moveto a revenue sharing regime. Several other aspects of the license, such as calling charges, rentals,duration of the license and choice of technology were also altered over time. The government hasnow decided to hold an auction for the issue of the fourth cellular license

Initial licensing procedure

In December 1991, the government invited competitive sealed bids for two non-exclusivedigital mobile licenses, for a 10-year period, extendible by 5 years, for the four metropolitancities of Mumbai, Delhi, Calcutta and Madras. The license specified the use of GSM standardsfor offering cellular services. The annual license fee for the first three years was a given

parameter, while the license fee from the fourth year onwards was fixed at Rs.5,000 per subscriber (based on unit call rate of Rs.1.10) subject to a minimum total amount. Along with thelicense fee, call charges were also a given parameter and the bidding was for the lowest rental to

be charged from customers. The evaluation was on the basis of financial strength, experience of the partners, committed rollout and lowest rentals. At the end of the tender process, the value of lowest rental was fixed at Rs.156 per month and eight licenses were issued in October 1994.


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License scheme based on NTP-1994

The framework for the initial licensing for offering cellular services was based on NTP-1994. The licenses for the cellular services were divided among metros and non metro circles. In

November 1994, the government first issued eight licenses to start cellular services in four metros circles. Subsequently, during 1995-1998, the government issued 34 licenses for cellular

services in 18 circles. The license scheme, based on NTP-1994, allowed up to two players per circle. Based on these licenses, the first cellular operations began in August 1995, in metrocircles and in December 1996, in non metro circles.

License scheme based on NTP-1999

The new National Telecom Policy was announced in March 1999. Subsequently, thegovernment decided to allow two or more operators to offer cellular services in each circle. Thegovernment decided to allow two or more operators to offer cellular services in each circle. Thegovernment offered the position of the third cellular operator to MTNL (in Delhi and Mumbai)and BSNL (the remaining circles except Delhi and Mumbai). Further, in October 2001, thegovernment issued fourth cellular licenses in four metro circles and 13 non-metro circles. BySeptember 2002, a few cellular operators (Bharti and Hutchison) had started cellular services invarious circles as fourth operators.

Migration from fixed license regime to revenue sharing regime

In 1999, private telecommunication operators were offered the option to change the basisof estimating their license fees from a fixed amount to share of revenues. Further, the license

period was extended from 15 years to 20 years. However, these concessions were subject tooperators accepting a set of conditions. These include: The existing cellular operators had to clear all the dues by January 2000, as a pre-condition

for changing the basis of determining the license fees from fixed to a revenue share (witheffect from August 1999).

The clause relating to the exclusively of license was removed from the new licenseagreement. (Hence, more operators could be provided licenses from a circle in the future.)

All private telecommunication operators accepted the terms of migration to a revenue-sharing arrangement with effect from August 1999. For cellular operators, license fees paid tillJuly 1999 were treated as an entry fee.

Licensing guidelines for entry of fourth operator

The TRAI in making its recommendations on the entry of the fourth cellular operator inJune 2000 pointed out that it was constrained in its ability to make recommendations because of lack of information about the availability of spectrum either for the third or the fourth operator. It

pointed to the critical role of spectrum planning in sustaining competition and ensuring servicequality.

After receiving the TRAI's recommendations in June 2000 the government announced itsguidelines for issue of license for the fourth operator. Some of the important features were: General license conditions

The bidder company can apply for any number of service areas subject to fulfillment of all the conditions of entry. The license will be issued on non-exclusive basis, for a period of 20years, further extendable by 10 years at one time at the discretion of licensing Authority.


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Transfer of licenses

Resale of business / assign ability/transferability of license by one network owner toanother shall be permitted subject to prior written consent of the Licensor which shall be grantedafter ensuring the conditions in respect of net worth, paid up equity and in accordance with other terms & conditions, procedures prescribed in Tripartite Agreement, if duly executed amongst

Licensor, Licensee and Lenders. However, such permission shall be granted only after ensuringthat competitiveness in the service area is not compromised. Choice of technology

Any digital technology either once already validated by TEC or having been used for acustomer base of one lakh or more for a continuous period of one year anywhere in the world,shall be permissible for use regardless of its versions. Minimum roll-out obligation

In Telecom Circles, at least 10% of the District Headquarters (DHQs) will be covered inthe first year and 50% of the District Headquarters will be covered within three years of effectivedate of License. The licensees shall also be permitted to cover any other town in a District in lieuof the District Headquarters. Coverage of a DHQ/town would mean that at least 90% of the area

bounded by the Municipal limits should get the required street as well as in-building coverage.In Metros, 90% of the service area shall be covered within one year of the effective date. TheDistrict Headquarters shall be taken as on the effective date of license. Entry fee

The successful bidder will be required to pay one time Entry Fee based on the final bid before signing the License Agreement. The bidding process shall be structured as "InformedAscending Bidding Process". Revenue share

In addition to the Entry fee described above, the Licensee shall also pay License feeannually @ 17% of Adjusted Gross Revenue for the Metro cities & Telecom Circles(exception being 10% for Andaman & Nicobar Circle) as Revenue Share generated from theService in accordance with the procedure prescribed in the License Agreement document. Thislicense fee will now be applicable for both existing and new operators.

SAP-LAP ANALYSIS OF INDIAN TELECOM POLICY

a) Background

The case situation has been taken from Telecom services sector. Telecom services inIndia, until recently were run by monopolistic and monolith government organization, i.e.Department of Telecommunication (DoT). Telecom services were opened to private sector through a process of privatization initiated in 1994, under the Ministry of Communication,Government of India. Successful bidders were granted license to build and operate telecomnetwork with conditions stipulated in the Tender document and license agreement.

However, the desired objectives of increasing the Tele-density and world class service atreasonable price have not been met with only few of private operators able to commence andexpands their services. Especially, in the case of basic telephony services, only one privateoperator has started service in Madhya Pradesh with remaining private operators grappling withGovt. on high license fees. Financial institutions were unwilling to finance the projects due to


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high investment cost contributed primarily by license fees. Similarly Government has not beenable to recover dues on license fees from cellular operator who have pleaded their inability to doso. The years in between also saw many litigation being filled in court for various reasonsresulting in the whole situation getting messy and resulting in delayed operations.

In nutshell the objectives of the NTP'94 could not be met and results of privatization have

so far not been satisfactory. Therefore, these realization buy government has resulted in newtelecom policy NTP' 99 which seeks to the remove the ambiguities of NTP' 99, incorporatechanges necessitated by new technological development and also broaden the scope of NTP' 94to include regulator role and Internet services.

b) New Telecom Policy (NTP 2005-2006)

The New Telecom Policy (NTP 2005-2006), that is in the works, is expected to have aspecial focus on consumer issues like ubiquitous coverage, periodic advisories on tariffs, number

portability, Carriers Access Code (CAC) and a toll free national emergency number (108) for calamities. The policy is also likely to push for faster spread of broadband, local content,affordable PC's, Internet applications and e-initiatives.

Going by NTP-2005/06 drafts, inclusion of telecom consumer issues will be one of themajor changes over existing NTP' 99. According to draft policy all service providers must allowcustomers to get access to services like calling cards, toll free numbers, which are provided byother operators.

c) SAP-LAP framework for National Telecom Policy

To understand evolution of the NTP' 94 to NTP' 99, we can apply SAP-LAP framework,do an analysis with SAP and understand through LAP (figure 4.4) as to what were the variousPUSH and PULLS which resulted in the NTP' 99. The question framework lucidly brings as tohow SAP-LAP approach contributes to the learning and improved decision making.


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Fig I SAP-LAP framework

Source: Sushil (2000) Flexibility in Management, New Delhi, Vikas Publishing House

d) SAP (Situation Actor Process)

What is present and past situation ?

The situation can be understood by framing few questions and providing explanation for these.

a) a) Why was NTP' 94 required?

The objectives of the New Telecom Policy 1994 are as follows:

1. 1. The focus of the Telecom Policy shall be telecommunication for all andtelecommunication within the reach of all. This means ensuring the availability of

telephone on demand as early as possible.2. 2. Another objective will be to achieve universal service covering all villages as early

as possible. What is meant by the expression universal service is the provision of access to all people for certain basic telecom services at affordable and reasonable

prices.

3. 3. The quality of telecom services should be of world standard. Removal of consumer complaints, dispute resolution and public interface will receive special attention. The


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objective will also be to provide widest permissible range of services to meet thecustomer's demand at reasonable prices.

4. 4. Taking into account India's size and development, it is necessary to ensure that Indiaemerges as a major manufacturing base and major exporter of telecom equipment.

5. 5. The defense and security interests of the country will be protecte d.

b) Why changes were needed?

1. 1. In addition to some of the objectives of NTP 1994 not being fulfilled, there have also been far reaching developments in the recent past in the telecom, IT, consumer electronics and media industries world-wide.

2. 2. Convergence of both markets and technologies is a reality that is forcing realignmentof the industry.

3. 3. Far reaching developments in recent past in Telecom, IT, consumer electronics andmedia industries world wide.

4. 4. The new telecom policy framework is also required to facilitate India's vision of becoming an IT superpower and develop a world class telecom infrastructure in thecountry.

c) c) What is the objective of NTP' 99?

1. 1. Access to telecommunications is of utmost importance for achievement of thecountry's social and economic goals. Availability of affordable and effectivecommunications for the citizens is at the core of the vision and goal of the telecom

policy.

2. 2. Strive to provide a balance between the provision of universal service to alluncovered areas, including the rural areas, and the provision of high-level servicescapable of meeting the needs of the country's economy;

3. 3. Encourage development of telecommunication facilities in remote, hilly and tribalareas of the country

4. 4. Create a modern and efficient telecommunications infrastructure taking intoaccount the convergence of IT, media, telecom and consumer electronics and thereby

propel India into becoming an IT superpower;

5. 5. Convert PCO's, wherever justified, into Public Teleinfo centers having multimediacapability like ISDN services, remote database access, government and communityinformation systems etc.

6. 6. Transform in a time bound manner, the telecommunications sector to a greater competitive environment in both urban and rural areas providing equal opportunitiesand level playing field for all players;

7. 7. Strengthen research and development efforts in the country and provide an impetusto build world-class manufacturing capabilities.

8. 8. Achieve efficiency and transparency in spectrum management.

9. 9. Protect defense and security interests of the country.

10. Enable Indian Telecom Companies to become truly global players.


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d) d) What is the demand of the Industry & Market?

1. 1. Demand of the industry was level playing filed between incumbent operator andnew operators

2. 2. Changes from licensing based regime to revenue sharing regime

3. 3. Good quality services at affordable prices for consumer 4. 4. Choice of multiple and varied services for consumer

Who were the Actors ?

The main players in the Telecom industry and their interest are

1. 1. Ministry of Communication- Vies it as key sector development from economicangle as major part of GDP would be contributed by this sector

2. 2. Telecom Operators (ISP, Cellular and Basic) They need flexibility in business interms of tariffs, technology choices and types of services which can be delivered

3. 3. Equipment Manufacturer and suppliers - Establish a level playing field for thelocal and foreign suppliers through appropriate import duty structure, competition and

protection of domestic manufacturing industry

4. 4. DOT & MTNL Retain Monopoly and corner market share for more revenue

5. 5. TRAI Regulate tariff, Service delivery quality and dispute

6. 6. FIIs Profitability of their financial operations through loan arrangements, bridgefinancing and debt funding in the scenario where the new Telco operators have been

burdened by high license fees committed by them in their bidding and also with highinfrastructure cost, the easy financing terms play important role in deciding thetechnology choices.

7. 7. End consumers Improved services, cheaper services, varied services choice andeasy availability.

What are the Processes in evolution?

a) What is being done?

The changes required in NTP' 94 have been incorporated keeping in view of actors insituation have been incorporated in NTP' 99. The license structure shift from fixed fees to

profit sharing has already been done pending the passing of resolution in the parliament.

b) How is it being done?

This is being done through policy and empowering TRAI's role who has alreadyannounced ceiling for new structured cost based tariffs. Similarly, no license fee conceptfor ISP services is another push toward achieving the main objectives of NTP'99.Allowing for technology choices in cellular mobile telephony services is another steptowards this direction. The world is witnessing the advent of usage of IP and Internetfueling IP-based traffic growth, VoIP (Voice over Internet Protocol) applications andVideo on demand services. Similarly, CATV operators are expanding their operationhorizons to venture in telephony services. Therefore, the future tomorrow lies in thetechnologies that will address the voice telephony and data market on single platform.Evolving CDMA 3G standards promises to deliver the same.


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c) Why it is being done?

The objectives of NTP' 94 stated why it is needed.

e) LAP (Learning Action Performance)

What is the Learning ?

a) What are the key issues related to the situation, actors and process?The key factors which are their in situation is the

1. 1. Drawbacks, limitations of NTP' 94

2. 2. Rate of change of technology

3. 3. Wrong demand prediction resulting in wrong market analysis

4. 4. Formulation of NTP in isolation of industry

5. 5. Process of distribution of licenses on NPV of license fees which resulted in differentcalculations and delays in awarding license.

What are the Actions ?a) What is being done to improve the situation?

1. 1. Formulation of NTP'99, announcement of new tariffs, announcement of new licensestructure and allowance for technology other than GSM in CMTS. As explained earlier,the variety of technology, which can be used in the new telecom market is vast. Eachtechnology has its application in different fields and is distinct by the very attributes thatmake them suitable for different applications.

2. 2. Formation GOT (Group on Telecom) to suggest ways and means for improvement.

3. 3. Formation of TRAI.

4. 4. Announcement of DoT services wing.b) What more can be done for improvement?

1. 1. Speeder NTP' 99 implementation.

2. 2. Creation of telecom fund with participation of Government and Financial Institutions

3. 3. Telecom tasks force to have more industry representation

4. 4. Higher and more focus on indigenous manufacturing

5. 5. Promotion of collaborative R&D for greater efficiency and result achievement between Governments funded R&D's like DRDO, C-DOT, ITI and private companiesR&D being taken by companies like Shyam Telecom, Professor Jhunjhunwala at IIT

Madras, HFCL, and Lucent Technologies etc.What are the key performance parameters ?

a) What will be the impact on the situation?

The improvement in situation and performance of NTP' 99 can be analyzed from the perspective of further changes in NTP' 99. This can be assessed base on

1. 1. Growth in Tele-density and its uniform distribution


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2. 2. Growth in contribution of telecom industry in National GDP and state's SDP

3. 3. Improvement in QoS and measurement against set benchmarks

4. 4. Number of services choices

5. 5. Cost of service to consumer and service providers

f) Synthesis of Learning

It can be seen that SAP-LAP provides framework for situational analysis and to arrive atdecision improvement and making the correct choice. This general framework can be applied tovaried situations to understand the situation and help in decision making either using qualitativeand or quantitative approach embedded with in SAP-LAP.

REFERENCES

The worldwide telecom industry is in a strong growth mode. In fact, telecommunications hasbeen one of the most dynamic industries in terms of rapid technology advancementcombined with deregulations. The industrys overall revenue is estimated to be over $1.3trillion (2007). A few well-known names in the telecom sector are Sprint, Cable & Wireless,Telstra, AT&T, China Telecom and Reliance Communications. These companies and severalother similar industries are conventionally known as Communication Service Providers (CSPs). They cater to a wide variety of cross sectional industry sectors be it IT, Bio-technology, Health Care, Manufacturing and even a residential consumer.

SAP leverages its solutions for CRM, asset life cycle management, supply chainmanagement and financials to address the business needs. Built-in adapters connect all SAPmodules to enable users to extract the data needed to accomplish their respectiveprocesses. If necessary, SAP also offers open-ended integration tools with other systems toconnect and complete the processes.

A customer life cycle process in a telecom industry can be broadly classified as Pre-Sales,Sales, Order Administration & Provisioning, and Customer Support.

All individual sub-functions can be grouped into each of the above processes to understandthe requirement of IT tools / technology to effectively carry out the process. Dependingupon the business strategy and positioning, typically Pre-Sales starts with campaigns andextends up to identifying prospective customers. However, telecom products are unique andneed to be bundled / configured to meet each customer requirement. Quotes will need to beworked by a technical team. Upon the customer confirming the order, the provisioning teamworks on order fulfillment and customer acceptance. They will give the necessary inputs to

the billing team to complete the billing process.

Then the customer support team takes over and makes itself available for any supportrelated issues / queries. Each of these processes will need robust tools to capture, share,and for timely analysis of technical / business data to effectively carry out the businessfunctions. Multiple IT systems to meet the needs will add to the performance andmaintenance issues.


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While the business process of each company varies with the business strategy and productpositioning, SAP captures the best business practice across the industry. SAP alsorecommends implementing its ERP as much out-of-the box as possible to leverage the bestpractice. This will enable quicker ROI to companies and easy to maintain or upgrade theapplication later. The business process explained above relates to the best practice

approach for a CSP. Each business function, however, needs to be broken down into specificunits.

The customer has a choice of accessing through the Web, email, phone, partner or fieldrepresentative. During this prospecting process, SAP unifies multiple channels throughwhich the customer can access, thereby enabling sales or marketing personnel to get a 360-degree view of the customer. This sharing of prospect or customer information is extremelyimportant from the point of view of new client acquisition. In addition to effectivelycapturing the customer needs using the SAP CRM module, during proposal building stage,each service can be combined or bundled with other products and sub-services.

This is where SAPs product configuration and bundling come in handy. Price calculation canbe done faster using the pricing engine. This flexibility reduces the time to market andaddresses customer needs uniquely. Following the quote stage, once the customerconfirmation is received, contracts or agreements can be captured in SAP and orderprocessing commenced. Order types could vary among New / Change / Cancel / Add-on.Each order type can be processed as per the data required and associated workflows. Theorder status can then be tracked and once completed, the customer, service and contractdata will be sent to billing. The modules are integrated on the same SAP platform and hencereduce redundancy.

In terms of customer support function, issues can be broadly categorised into Network

trouble tickets and Customer trouble tickets. The former is created by CSPs themselveswhen there is a network outage and multiple customers on the network get affected.Customer trouble tickets are those where there is a fault for a specific customer. In eithercase, SAP CRM service module can address the issues and track the complete trouble ticketcycle.

SAP also equips field service engineers with the knowledge base, based on historicalresolution cases. This will enable quicker resolutions and easier adaptability for new serviceengineers. In case companies are looking for spare parts planning SAP has ready modulesto cater to.

With its rich functionality, SAP supports end-to-end business processes for a customer-centric organisation. SAP solution maps recommend the best practice approach to meet thevarying demands of the industry and help companies to stay competitive in one of the mostdynamic markets.

The author is Principal Consultant of SAP practice with MindTree Consulting Limited,Bangalore.


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SAP Services Research ProgramSegmentationSAP Services Research Program, InDepthSAP Services Research Program | Segmentation | 2009 2

PAC, July 2009

SegmentationFirst of all, it is important to understand that our scope of investigation is purely on theexternal market for SAP-related services. This excludes all SAP-related internal serviceactivities on the user side and performed by internal IT departments.PACs reports on the SAP-related Services market analyze Consulting & SystemsIntegration Services (C&SI), derived from PACs Project Services segmentation as wellas Hosting and Application Management Services, which reside in the IT ServicesMarket. SAPs Software business falls in PACs Business Application Softwaresegmentation, to be found within the larger Application Software market. The followingdefinitions are intended to provide the reader with a better understanding of where the


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SAP-related Services market exists, as illustrated below.SAP Services Research Program | Segmentation | 2009 3

PAC, July 2009SAP Products SegmentationDefinitionPACs SAP software products figures include only revenues generated from application

software licenses and maintenance / support fees, in addition to application-relatedsystems infrastructure software and tools, namely the SAP NetWeaver platform and BIapplications and tools.SAPs revenue results from business applications.Business Application Software (BAS) consists of process-oriented applications thatinclude horizontal applications, such as financials, HRM, CRM, SCM as well as industryspecificsolutions, such as billing (telecom, utilities), core banking systems, etc.Application software products are often sold as packaged solutions including hardwareand services, e.g. implementation services. The value of the hardware and servicesresold is excluded if i t can be determined. All related revenues from implementationservices (consulting, implementation / customization, training) are booked as consulting &systems integration services revenues.Please note that we consider highly verticalized Systems Infrastructure Software andTools as Application Software Products in some industries, as they really are at the coreof the respective applications. This applies in particular to software products dedicated tothe telecom sector in areas like billing, telecom network management or platforms forenhanced services. For example, telecom network management clearly is an applicationarea for a telecom operator, while traditional systems and network management softwareproducts are designed to help run an IT system and as such are considered as SystemsInfrastructure Software by PAC.SAP Services Research Program | Segmentation | 2009 4

PAC, July 2009Segments & Sub-SegmentsBusiness ApplicationsHorizontal Business Applications:

Accounting & FinanceSupply Chain Management, Distribution & PurchasingHuman Resources ManagementCRM / Sales Management / Sales Force AutomationSupplier Relationship Management, ProcurementProduct Lifecycle Management, Enterprise Asset ManagementBI Reporting and Decisional Tools (front-end)Vertical Business Applications:All industries need specific vertical business applications. Below you find someexamples:Manufacturing: Material Requirements Planning, Quality Management, ManufacturingExecution SystemsBanking: Account Management, Payment Transactions, Credit Management SystemsInsurance: Policy and Product Management, Claims Management, Commissions andPartner ManagementPublic: Tax & Revenue Management, Grant Management, Hospitals, PatientManagementTelecom / Utilities: Billing / Metering, Network Maintenance ManagementRetail & Wholesale: Points of Sale, MerchandisingServices: Services AutomationTransport: Booking Systems, Traffic Control SystemsSAP Services Research Program | Segmentation | 2009 5


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PAC, July 2009Consulting & Systems Integration (C&SI) Services SegmentationThis sub-category is derived from PACs project services segment and includes:

IT Consulting;Systems Integration.

Furthermore, PAC considers only the portion of Consulting Services that is Business

Application Software-related (BAS-related), and of that SAP-related, as follows.IT Consulting

Planning, specification, and design of information systems; IT-related process consulting.

According to PACs segmentation, it includes purely IT-related services (audit of theinformation system, design, selection of technologies and products, etc.), but also the"process consulting" (Business Process Reengineering BPR, change management andsimilar services) part of IT projects such as ERP implementation projects.- In terms of technology, application-related IT consulting services relate to:

Application software products (custom development or packaged software);Application-related tools: BI, development tools, integration platforms, workflow,

content management, etc.- In terms of services, application-related IT consulting includes:

Consulting on the organization of information systems: all preliminary services,such as studies prior to the development and / or implementation of newapplications, the overhaul of processes and procedures involving informationtechnology, preparation of changes in application systems, etc.;

Consulting on the selection / implementation of application software andpackages: it covers consulting on horizontal application software products, suchas enterprise resource planning (ERP), customer relationship management(CRM), supply chain management (SCM), human resources management(HRM), etc., and vertical application software products, such as points of sale,core banking systems, etc.;

Assistance in miscellaneous project management tasks: support for all projectsinvolving vertical or horizontal applications, change management, governance, ITsuppliers relationship management, etc.;

Also includes process and application-related consulting services in industrialinformation systems, control / command / supervision, simulation, and embeddedsoftware in the areas of defense, transport, energy, telecommunications, etc.SAP Services Research Program | Segmentation | 2009 6

PAC, July 2009Systems IntegrationThis segment includes the following services:

Custom software development; Packaged software implementation; Integration of applications and infrastructure products.

Important: this category includes both types of IT services invoiced on a Time & Material

(also known as T&M, contract staff, staff augmentation, body shopping, etc.) basis as wellas on a fixed-time / fixed-price basis.Application-related Systems Integration- In terms of technology, application-related services relate to:

Application software products (custom development or packaged software);Application-related tools: BI, development tools, integration platforms, workflow,

content management, etc.- In terms of services, application-related systems integration includes:

Design / development of customized management information systems or


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applications;Design / development / implementation of package-based information systems or

applications (ERP, CRM, etc.);Maintenance of applications (customized or package-based) on time & material

contracts;Integration projects for customized and package-based applications;

Also includes application-related systems integration services in industrialinformation systems, control / command / supervision, simulation, and embeddedsoftware in the areas of defense, transport, energy, telecommunications, etc.SAP Services Research Program | Segmentation | 2009 7

PAC, July 2009Outsourcing Services SegmentationAccording to PACs segmentation, outsourcing is characterized by:

Long-term contracts (3 to 10 years or even more);Often takeover of the outsourcing customers assets (human resources and / or

infrastructure) by the outsourcer;Takeover of responsibility by the supplier: performance of defined services,

fulfillment of defined service level agreements not only provision of staff and / orinfrastructure;

Payment: still very often on a fixed-price basis, but modular in order to respond tothe changes in customers' requirements. Payment conditions are increasinglyvariable, e.g. dependent on the degree of utilization (keyword: outsourcing ondemand). Additionally, the price may also be based on non-IT measurements(business metrics).However, these criteria do not necessarily apply to all kinds of outsourcing services.Exceptions are, e.g., managed services / outtasking (normally no transfer of assetsand / or staff), Web hosting or application service providing (ASP) / Software as a Service(SaaS) (often at short notice, no transfer of assets and / or staff, payment often based ona pay-per-use model).Hosting ServicesApplication Hosting hosting of an application, including server / mainframe and basicsystem operation, but excluding application management.Application Management Services (AM)Application management (AM) describes the maintenance and enhancement of existingapplications (custom development and / or customized software products), sometimeseven their initial development, under a long-term (multi-year) contract with a commitmentto fulfilling pre-defined service level agreements (SLAs) on a fixed-price basis. Often, staffis transferred.Please note: PAC considers stand-alone application management as well as AMembedded in complete or application outsourcing deals to be included in the respectivesegments.SAP Services Research Program | Segmentation | 2009 8

PAC, July 2009

Overview SegmentationSAP Services Research Program | Segmentation | 2009 9 PAC, July 2009SAP Services Research Program | Segmentation | 2009 10

PAC, July 2009

About Pierre Audoin ConsultantsPAC is a global market research and strategic consulting firm for the Software and ITServices Industry (SITSI). PAC helps IT vendors, CIOs, consultancies and investmentfirms by delivering analysis and advice to address a range of growth, technology,


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financial, and operational issues.Our 30+-year heritage in Europe combined with our US presence and worldwideresources forms the foundation of our abili ty to deliver in-depth knowledge of local ITmarkets, anywhere. We employ structured methodologies undertaking thousands ofannual face-to-face interviews on both the buy and sell side of the market, as well as abottom-up, top-down approach to leverage our research effectively.

PAC publishes a wide range of off-the-shelf and customized market reports includingour best-selling SITSI program in addition to our suite of strategic consulting andmarket planning services. Over 160 professionals in 16 offices across all continents are delivering the insight that can make a difference to your business.For more information, please visit our website at www.pac-online.com.SAP Services Research Program | Segmentation | 2009 11

PAC, July 2009

Copyright & Legal DisclaimerAll information provided by Pierre Audoin Consultants (PAC), in any form, is proprietary toPierre Audoin Consultants (PAC) and is protected in each country by local and nationallaws governing intellectual property. All information published by Pierre AudoinConsultants (PAC) or presented by its employees is copyright protected, including hardcopy

or electronic material, as well as material on our website. The omission of anycopyright notice does not invalidate copyright protection and does not indicate that PierreAudoin Consultants (PAC) authorizes the production of such proprietary material.Violation of Pierre Audoin Consultants (PAC)'s copyright may permit Pierre AudoinConsultants (PAC) to recover actual damages, statutory damages, punitive damages,and attorneys' fees through actions in local, national, or international courts. PierreAudoin Consultants (PAC) will prosecute violators of its copyrights.Additionally, Pierre Audoin Consultants (PAC) may be entitled to terminate the licensecontract in consequence of any violation of Pierre Audoin Consultants (PAC)s copyright.No part of this publication may be reproduced or transmitted for external use for anycommercial or non-commercial purpose in any form or by any means, electronic ormechanical, including photocopy, recording, or storage in any information storage orretrieval system, without the express written consent of Pierre Audoin Consultants (PAC).Nothing contained herein shall create an implication that there has been no change in theinformation since its original publication. While every effort has been made to ensureaccuracy, Pierre Audoin Consultants (PAC) cannot be held responsible for any errors oromissions. Additionally, Pierre Audoin Consultants (PAC) cannot be held liable for misuseby any third party. In addition, Pierre Audoin Consultants (PAC) may only be held liablefor losses resulting from malice aforethought or gross negligence of Pierre AudoinConsultants (PAC). For any other losses, Pierre Audoin Consultants (PAC) can be heldliable only to foreseeable damages. Pierre Audoin Consultants (PAC) cannot be heldliable for losses related to decisions made based on the contents of our research or anyother materials or opinions. Readers should independently verify any information beforetaking any action that could result in financial loss.Copyright Pierre Audoin Consultants (PAC), 2009. All rights reserved.

SAP Services Research Program | Segmentation | 2009 12 PAC, July 2009PAC PARIS23, rue de CronstadtF-75015 Paris,FranceTel: +33 (0) 1 56 56 63 33Fax: +33 (0) 1 48 28 41 06PAC MUNICH


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Holzstrasse 26 D-80469Munich, GermanyTel: +49 (0) 89 23 23 68 0Fax: +49 (0) 89 719 62 65PAC NEW YORK CITY 231 W. 29th St. Suite 502,

New York, NY 10010, USATel: +1 (646) 277-7250Fax: +1 (646) 607-1716PAC BUCHARESTLouis Pasteur 40050536 Bucharest 5,RomaniaTel.: +40 (0) 21 410 75 80Fax: +40 (0) 21 410 75 81PAC LONDON15 Bowling Green LaneEC1R0BD London, UKTel: +44 (0) 207 251 2810Fax: +44 (0) 207 490 7335PAC SAO PAOLOAl. Santos, 1800 8th Floor,Suite 1027,Sao Paolo, 01418-200, BrazilTel: +55 (0) 11 3170 3134Fax: +55 (0) 11 3170 313425+ professionals worldwideprovide local and global marketexpertise to the Global SAPServices Research Program25+ professionals worldwideprovide local and global marketexpertise to the Global SAPServices Research ProgramPACs SAP Services Website:www.pac-online.com/sapPACs SAP Services Blog:www.feedingthesapecosystem.comPACs Website:www.pac-online.com

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