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
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