Impact of technological environment on

Communication sector

Anshu Singh

BBA

Navrachana University, Vadodara

By:-

Introduction

The rapid change in technology in has significantly impacted the operational aspect of communication sector.

Coupled with increased competition and emergence of rural market, the telecom sector is faltering in its evolution.

The technologies normally have a flow path from developedmarkets to underdeveloped or developing marketswhich has a lag time.Now, with better connectivity andprocesses this lag time has constantly reducing featuring a global launch of technology than in segments.

This has made the total business framework complicated.

Small changes can bring huge changes in the entire setup and financial budgeting of the companies.

Hence, volatile the telecom market is and the companies are fighting this on small margins.

Current Scenario

3rd highest internet users

2nd largest Subscriber base

With a subscriber base of nearly 1058.86 million, as of March 2016, India accounted for the second-

largest telecom network in the world

With 342.65 million internet subscriptions, as of March 2016, India stood third-highest in terms of

total internet users in 2016.

Most of the Internet accessed through mobile

phones

Rising penetration rate

Mobile based Internet is a key component of Indian Internet usage, with seven out of eight users accessing internet from their mobile phones

As of March 2016, urban tele-density stood at 154.01 per cent and rural tele-density at 51.37 per

cent

Current Scenario

Economic

PositiveNegative

Various ImpactsIMPACTS

I M PA C T S

Economic Impacts

Economic impact

Productivity

CreationEmployments Economic Growth

Productivity

Improvement of total factor productivity, particularly in

those industries that are ICT-intensive but also in • those

that are not

Creation

Relocation of enterprises based on the availability of

high capacity telecommunications

networks (as one of many infrastructure factors) and

quality of life (driven by availability of networks in schools, hospitals, public

administration etc.)

Economic impact

Creation of qualified self-employment resulting from

the availability of communication networks

Creation of employment in manufacturing and

installation of telecommunications

equipment

Increase in efficiency of industries with high

transaction costs (retail distribution, finance etc.)

Consumer surplus generated by the availability of new telecommunications services, reduction of travel time and transportation etc

Economic impactEmployments

Economic Growth

Positive Impact1.Data Connectivity

2.Bridge between Rural & Urban

3.Handset in hands

4.Ease of accessing

5.Overcoming Disabilities

6.Reaching Broader Audience

Positive

Data Connectivity

Bridge rural and urban

Earlier, at the primary stage of Internet revolution “Data Connectivity” was the biggest issue. People could not access the internet easily. But after the global change in in technology the era of “weak

connectivity” is slightly moved downstream. Although, In India we have the “Connectivity”

problem.

When the technological environment started boosting the need to connect the urban and rural areas came into the picture. In many parts of the world the networking started growing. Now, rural people can easily connect with urban and it also

encouraged the Rural entrepreneurship.

Handset in Hands

Ease of accessing

In mid & late 90’s when telecom sector was setting his feet into the market, cellular phones generation started. Mobile phone was the boon

for this communication sector. Now, people need not depends on the string and cord

telephones the place was started taking by mobile phones. Now 9 out of 10 people carry

handset in their hands.

With increase in technology, the towers started getting advanced and the connectivity with satellite increased. Signal strengthen , with

hexagonal waves the call connectivity increased. But still, in our country we faced “call drops”

As people's ability to communicate improves, the reach of their messages widens. This can

be especially important in politics and activism. For instance, photos and video

recorded covertly through a cell phone can be quickly and easily shared online through

websites such as YouTube, making it harder for oppressive regimes to keep control; social networks such as Facebook and Twitter can

be used to organize and coordinate meetings and protests. The Egyptian revolution of 2011-2012 was spurred greatly by social

media.

Reaching Broader audience

Positive Impact

Negative Impact

1.Voice call converting to application call( Issue for Rural )

2.Spectrum Issues3.Call drop4.Sudden hike or

decline in prices5.Telecom sector in

loss

Voice calls converting to application calls

Today’s, Biggest problem in the Indian rural areas is the Voice call. People who aren’t have even proper 2G connection struggling between the wars of 4G. For the poor rural’s the voice call over internet is very far, they don’t even have proper network to call. The technology is diverting the voice calls over internet which to many extent better for urban society not the rural one. Since, the connectivity is the issue and market share of telecom sector is decreasing due to political and technological factors.

The GAP is widening

Spectrum Issues Spectrum fees leave no money in shareholders pockets

Market cap stagnant over past 7 years

The country five listed telecom operators- Bharti Airtel,Idea, Reliance, Tata Tele MTNL are currently valued at Rs1.71 lakh Cr. Downed from their combined market cap of around Rs 1.84 lakh Cr in March 2010.Operators have taken the billion dollar loans but due to instability the sector is not able to generate reveneue.

Competitive Rivalry (High)

Threats of new entrants (Low)

Threats of substitute

product (Low)

Suppliers bargaining

power (High)

Bargaining Power of

customer (High)

Porter’s Five force analysis

Latest Updates

Bharti Airtel Jio Idea Vodafone

Total spectrum holding across all 22 circles(in MHz)1,402

MHz1,108MHz 891

MHz957MHz

Bharti continues to lead in terms of overall spectrum

NOTE: Spectrum includes both uplink and downlink. Red boxes indicate spectrum purchased in current auction.

Data Source:

Anshu

Bansari

Shailaja

VrajSY-BBA- B