Strategy to EnterIndian Mobile Industry

Ankur patelMba (IB)Amity international business school

International Business Operation

• Serve millions of enterprise and multinational business corporations in six continents.

• (3G) services in more than 125 countries

• wireless service on more than 140 cruise ships worldwide.

Quick Facts

 

• AT&T serves 90.1 million wireless customers. • We were the first wireless provider in the world to offer Apple's iPhone

— the first and only wireless provider to offer a wireless device with iTunes.

• AT&T has more than 47 million consumer revenue connections and is the leading U.S. provider of traditional wire line voice services.

• 2.5 million Customers subscribe to AT&T U-verse TV, the only 100-percent IPTV service from a national service provider.

• We have more than 17.4 million high speed Internet subscribers as of 2Q10, serving more customers than any other U.S. broadband provider.

• We provide Wi-Fi access at more than 20,000 U.S. hot spots and more than 125,000 locations in countries around the world (including both company-owned and third-party roaming locations) — with access to approximately 7,000 Starbucks locations.

New Destination

INDIA

Segment:-Mobile Industry

Economic Indicators

• GDP (purchasing power parity): $3.548 trillion (2009)

• Services Sector share in GDP : 53.7% .• Population for India in year 2009 is

1,199.06 Million . • Inflation (Average Consumer Price

Change %) for India in year 2009 is 10.882 %

India Telephone Statistics

• Population : 1,199.06 Million • Telephones - Fixed lines in use: 37.54

million (2009)• Telephones - mobile cellular: 427.3

million (2009)• Internet users: 81 million (2008)

Network Expansion

• The number of telephones has increased from 54.63 million as on 31.03.2003 to 621.28 million as on 31.03.2010.

• Wireless subscribers increased from 13.3 million as on 31.03.2003 to 584.32 million as on 31.03.2010.

• Fixed line subscribers decreased from 41.33 million in 31.03.2003 to 36.95 million in 31.03.2010.

• The broadband subscribers grew from a meager 0.18 million to 8.76 million as on 31.03.2010.

Trend in Tele-density

• Tele-density in the country increased from 5.11% in 2003 to 52.74 % in March 2010.

• In the rural area teledensity increased from 1.49% in Mar 2003 to 24.31% in March 2010

• In the urban areas it is increased from 14.32% in Mar 2003 to119.45% in March 2010.This indicates a rising trend of Indian telecom subscribers.

Targets Set By the Government 

Network expansion• 800 million connections by the year 2012.

Rural telephony• 200 million rural subscribers by 2012• Reduce urban-rural digital divide from present

25:1 to 5:1 by 2010.

Broadband• 20 million Broadband connections by 2010• Broadband with minimum speed of 1 mbps.

Facts About Industry

Supply Intense competition has resulted in prompt service to the subscribers.

Demand Given the low penetration levels in the country and continuously falling tariffs, demand will continue to remain higher in the foreseeable future across all the segments.

Barriers to entry High capital investments, well-established players who have a nationwide network, license fee, continuously evolving technology and falling tariffs.

Bargaining power of suppliers Improved competitive scenario and commoditization of telecom services has led to reduced bargaining power for services providers.

Bargaining power of customers A wide variety of choices available to customers both in fixed as well as mobile telephony has resulted in increased bargaining power for the customers.

Competition Competition has intensified with the entry of new cellular players in select circles. Reducing tariffs will hurt the new entrants as they will be unable to recover their high capital investments.

Trends in Industry

SWOT Analysis of AT&T’s Entry into Indian Mobile Industry

Strengths:-• Robust infrastructure worldwide.• AT&T has been in India since the 1980s.• Giant and experienced in communication industry.• AT&T formed a joint venture in 2006 with Mahindra

Telecommunications Investment Private Ltd. The venture, AT&T India, operates to serve business customers in India. AT&T also has an alliance with VSNL in India. Both relationships allow AT&T to further strengthen its commitment to global customers wishing to do business in India – one of the fastest-growing and most exciting telecom markets in the world.

SWOT Analysis of AT&T’s Entry into Indian Mobile Industry

Weakness:-• Late Entry into Market.• Tough Competition from key players.• Difficult to get venture with big names.• Specialized in serving enterprise.

SWOT Analysis of AT&T’s Entry into Indian Mobile Industry

Opportunities:-• Large customer base.• Advantage in Mobile Broadband• Can play with the cost and gain market

share.• Can target Asia-pacific after India.

SWOT Analysis of AT&T’s Entry into Indian Mobile Industry

Threats:-• Difficult to gain market share due to big

player.• Brand in unknown to majority of people.• Unable to participate in 3G Auction and

hence difficult to launch 3G services.

How AT&T can Enter Indian Mobile Industry:-

• AT&T can enter into joint venture with Mahindra Communications(as both are serving enterprises and corporates currently) and apply for telecom license with TRAI.

• AT&T can buy stakes in major companies like Reliance, Airtel.

Conclusion

India is the world's fastest growing mobile market, with operators adding 8mn new customers each month, with currently, only 23 per cent of the population owns a mobile. So there is a huge market for any new player.

THANKS