1.

INTRODUCTION
1.1 WORLD TELECOMMUNICATION OVERVIEW:

The Telecommunications industry today is a key enabler of productivity across

economies and societies. The Telecom industry is a significant contributor towards the
economic activities of countries as well as growth of other industries. In recent times,
developing nations have witnessed significant growth and transformation in the
telecommunication and information sector. Telecommunication has been recognized in
the world-over as a powerful tool of development and poverty reduction through
empowerment of masses. It is one of key element of the Sustainable Development
Goals of the United Nations Agenda for Sustainable Development for 2030, reflecting its
growing reach, better networks and adoption of tools and solutions that enhance
digitization of systems, processes and interactions across key sectors like agriculture,
banking and healthcare in developing and middle income countries.1
As per GSMA Reports mobile technologies and services generated around 4.6% of GDP
globally in 2018, a contribution that amounted to $3.9 trillion of economic value added.
By 2023, this contribution will reach to $4.8 trillion, or 4.8% of GDP, as countries around
the globe increasingly benefit from the improvements in productivity and efficiency
brought about by increased take-up of mobile services and technology based solutions.
By the end of 2018, 5.1 billion people around the world subscribed to mobile services,
accounting for 67% of the global population. More than 1 billion new subscribers have
been added in the last five years since 2013 (representing an average annual growth
rate of 5%). An average annual growth rate of 1.9% between 2018 and 2025 will bring
the total number of mobile subscribers to around 5.8 billion (71% of the total
population).2
The global telecommunications market is continually developing on account of the
ongoing innovations and developments taking place consistently and at a very fast pace.
The mobile market growth worldwide can be attributed to the increasing number of

1
Department of Telecommunication, Annual Report 2018-19
2
The Mobile Economy 2019

1
popularity of varied smart-phones. By 2018, around 60% of all mobile users were smart-
phone users and by 2025, this number is expected to reach over 79%.
5G trials and its deployment in the market will be a key focus area in the near future as
around more than 15 countries will have launched 5G networks by 2019. Companies are
expected to strive for improving their network strength and offering valuable innovative
services to their customers by network densification and making use of small cells.
Installing more fiber infrastructure and enhancing spectrum efficiency will also be one of
the target for the companies in near future.
There are many factors fueling the growth of the global telecommunication market such
as the advanced technology, market competition, and investments flow in new
telecommunication technologies includes wireless and satellite communication. Apart
from this, affordability of services, new consumer friendly technology, various
innovative services such as e-banking, e-agriculture and e-education, and increasing
demand for high speed internet service are also influencing factors for the growth of the
telecom market. On the other side, the high cost of value added services such as mobile
TV, mobile money, live streaming etc may restrict the growth of the telecom market. In
addition to this, maintaining safety and security will also pose a great challenge for the
telecom market development.
The services provided by key players in the telecommunication market include providing
storage area networks, storage products, 4G services, calling cards, storage networking
services, entry level servers, enterprise networking services, broadband networks, and
application networking services. The growing number of internet users worldwide has
been increasing exponentially day by day and thus, within the telecommunications
market, the market for internet-based services is currently thriving and is at high peak.

1.1.1 Global Telecommunication Market Overview and development:

As everyday life appears to be increasingly dependent on the use of mobile technology
and services, the global market for telecommunication is predicted to grow at a
phenomenal rate over the upcoming years. Some prominent segments of

2
telecommunication industry are wireless communication, long-distance carriers,
domestic telecom services, communications equipment, processing systems and
products, and foreign telecom services. The telecommunication market can be broadly
segmented into telephones, internet service providers, satellites, and cable
communication. On the basis of usage, entertainment, communication, infotainment,
news, internet enabled services, and critical communication are the major categories.
During the period of 1990, the telecommunication industry showed a high growth rate
in terms of investment and eventually increased the competition in the market. The
high competition between the companies led to the decline in the revenues. As the area
of opportunity in telecommunications continues to shift from wires to wireless systems,
there is a need to access and develop more electromagnetic spectrum becomes one of
very essential needs. With increasing wireless technology and smart phones, the
relevance of value added services has also been increased. After the liberalization, world
telecommunication industry has been consolidating by allowing private players to enter
in the market and to establish their businesses in the telecom industry. In India the
existing public sector’s monopolies are now being privatized and accordingly
competition is developing in the telecom industry. In this context, the content remains a
key competitive advantage, but the focus is shifted from the traditional measurement of
audience share to an assessment of consumer reach to make them satisfied and loyal.

1.1.2 Global Telecommunication Market: Drivers and Restraints

Various telecommunication products and services, increased popularity of the Internet
of things, and substantial technological growth and advances are some of the major
reasons for the growth of the global telecommunication market. Various Smart
technological devices are being increasingly deployed and being used by across the
world. The smart cities projects across the globe are one instance where smart
technological devices such as, sensors and smart meters are used. The increasing
popularity of internet of things that has enabled machine-to-machine communication,
connecting various smart electronics devices such as air conditioners, audio visual

3
systems, refrigerators, food processors, etc. All this development has increased the
demand in the telecommunication market. In addition to this, factors such as cloud
computing, increased coverage of satellites, and the development of 4G and 3G cellular
networks are also the prominent growth drivers of the market for telecommunication
products and services, worldwide.
On the other hand, strict government policies can pose a roadblock to the market’s
growth. However, the increasing deployment of intelligent transportation systems is
likely to increase the demand for these services, nullifying the negative effects of these
restraints.

1.1.3 Global Telecommunication Market: Regional Outlook

Based on geography, the global telecommunication industry can be segmented into
North America, Europe, Asia Pacific and Rest of the World. The wireless and broadband
markets in North America are showing healthy growth and are expected to further
expansion.3
The massive population base of Asian countries such as China and India is one of the key
factors responsible for the high growth of the telecommunication market in Asia Pacific
region. China, being one of the largest mobile operators in the world, is likely to
represent a significant portion of the market shares. Another important reason for the
growth of China’s telecom market is its increasing international trade. Japan is also
expected to become a prominent regional market as its foreign investments build up.4
From the past two decades, the telecommunication market in India has been grown
rapidly as the focus of government was on widespread penetration of telecom services
in every nook and corner of the economy. The massive growth in the number of smart-
phones subscribers and internet users are some of the other important factors
responsible for the growth of the telecommunication market in this country.5

3
https://www.maximizemarketresearch.com/market-report
4
https://bics.com/asia-pacific
5
https://www.transparencymarketresearch.com

4
Besides the aforementioned emerging economies, the countries in Latin America such
as Mexico, Brazil, and Argentina too are slated to present significant opportunities as
the degree of penetration, high speed broadband services, 4G services, and the usage of
smart-phones increases constantly.

1.1.4 COUNTRIES WITH THE HIGHEST NUMBER OF MOBILE-CELLULAR TELEPHONE

SUBSCRIPTIONS IN 2018 (IN MILLIONS)
Table 1.1
Countries With The Highest Number Of Mobile-Cellular
Telephone Subscriptions (2018)
Name of the Mobile cellular telephone subscription
Country (in millions)
China 1320.81
India 1175.99
USA 327.57
Brazil 284.20
Rusia 256.11
Indonesia 236.80
Nigeria 167.37
Bangladesh 157.04
Pakistan 150.17
Japan 146.64

Source: https://www.worldatlas.com/articles/10-countries-with-the-highest-rates-of-cell-
phone-subscriptions

5
 Chart 1.1

Mobile cellular telephone subscription (in millions)

1320.81
1400 1175.99
1200
1000
800
600
327.57 284.2
400 256.11 236.8
167.37 157.04 150.17 146.64
200
0

Mobile cellular telephone subscription (in millions)

Source: Author has prepared personally from available data.

The massive population base of the Asian countries such as China and India is one of the
key factors responsible for the growth of the telecommunication market in Asia Pacific.
China and India, being one of the largest mobile operators in the world, is likely to
represent a significant portion of the market shares. This statistic shows the top
countries by number of mobile cellular subscriptions in 2018. In China, there were more
than 1.3 billion mobile cellular subscriptions in use in 2018, where as India were at
second place by more than 1.1 billion mobile cellular subscriptions. It further shows that
china and India are the fastest growing telecom sector with respect to the mobile
cellular subscriptions.

1.2 TELECOM SECTOR IN INDIA

1.2.1 INTRODUCTION
A well developed telecom sector has significant impact on the growth of an economy.
Telecom sector in India has changed entirely since the liberalization took place and the
public sectors’ monopolies have been replaced with the competitive regime. In present

6
era, the telecommunication services have been recognized globally as an essential tool
for economic development of a country. It is considered as one of the prime support
services required for the speedy growth and development of various sectors of the
economy. Indian telecom sector has undergone a major process of telecom revolution
through major policy reforms, mainly beginning with the declaration of National
Telecommunication Policy 1994, and was consequently re-emphasized and carried
further under National Telecommunication Policy 1999. Guided by various policy
initiatives, the Indian telecommunication sector witnessed an absolute transformation
in the last decade. It has achieved a extraordinary growth during the past few years and
is poised to take a big steps in the future days. The process of liberalization in the
country began in the right earnest with the announcement of the New Economic Policy
in July 1991. Telecom equipment manufacturing was de-licensed in 1991 and value
added services were declared open to the private sector in 1992, following which radio
paging, cellular mobile and other value added services were opened gradually to the
private sector. This has resulted in large number of manufacturing units being set up in
the country. As a result most of the equipment used in telecom sector is being
manufactured within the country. A most important breakthrough was the clear
enunciation of the government's intention of liberalizing the telecom sector in the
National Telecom Policy resolution of 13th May 1994.
The Indian telecommunication sector is recognized as the second largest in the world in
terms of the number of subscriber’s base.6 The sector has observed high growth over
the past few years which was mostly due to the factors like low tariffs, wider service
coverage and availability, roll out of new facilities and other services such as Mobile
Number Portability, 3G and 4G network service, growing consumption patterns of
consumers, and favorable regulatory environment.
Indian telecommunication sector passed through a high pace of market
liberalization and growth since the year 1990, and now it has been considered as the
worlds’ most competitive and fastest growing telecommunication markets. The telecom

6
TRAI Annual Report 2017-18

7
Industry has developed over twenty times in just ten years, from less than 38 million
consumers in the year 2001 to more than 845 million subscribers by the year 2011.
Now India is world's second-largest telecom market with cellular phone user base with
more than 1200 million users as on march 2018, India has world's second-largest
Internet market with subscriber base of more than 490 million as on March 20187.
Telecommunication sector has supported the socioeconomic development of an
economy and it has played a significant role to decrease the rural-urban digital divide to
some level. It has also supported to increase the transparency in governance with the
beginning of e-governance system in the country. The government has sensibly used the
new telecommunication facilities and services to deliver mass education programmes
for the rural area of India. India is now became the global leader in terms of monthly data
consumption, with average increment of 133 times from 62 MB per user per month in
2014 to 8.74 GB in 2018. The cost of data has also reduced substantially, enabling
affordable internet access for millions of subscribers8

1.2.2. CURRENT SCENARIO OF TELECOM INDUSTRY IN INDIA:

Indian telecom market is the second largest telecom market in the world by number of
telephone users with more than 1.1 billion subscribers as on June 2019. Indian telecom
market has one of the lowest call tariffs rates in the world enabled due to the many
telecom service providers and a high competition among them. India also has the
world’s second-largest market in terms of Internet users. There were more than 594
million internet subscribers in the country as on June 20199. Indian telecommunication
sector passed through a high pace of market liberalization and growth since the year
1990, and now it has been considered as the worlds’ most competitive and fastest
growing telecommunication markets. Modern telecommunication technology and
services have supported the socioeconomic development of India and has played a
significant role to decrease the differences among the rural-urban digital availability to

7
TRAI Annual Report 2017-18
8
DoT Annual Report 2018-19
9
TRAI Press Release 59/2019

8
some level. The high growth in the indian telecom sector have been facilitated by liberal
government policies which provides easy market access for telecommunication
equipment and a fair as well as supportive regulatory framework for offering
telecommunication services to the customers at very affordable prices.
The very high growth experienced by the telecommunication sector in the last few years
has led to the progress and development of the telecom equipment manufacturing as
well as other supporting industries. With the arrival of next-generation technologies and
4G and Broadband Wireless Services provided by operators, the demand for telecom
services and equipment has increased to a great extent and to capitalize on this
opportunity, the government and policymakers are focusing on domestic industrial
development. The Indian telecom equipment manufacturing company has come a long
way in the past few years. From import-centric industry it is now steadily moving
towards a global telecom equipment manufacturing hub. Favorable policy support from
the government has been required to the development of the sector in the country.
Increase in the Foreign Direct Investment limit from 74% to 100% is one of the crucial
decisions of the government towards the development of the telecom industry.
India’s telecommunications market is further expected to experience a very high growth
in near future, fuelled by increased in non-voice revenues and higher penetration in
potential rural market. The enlargement of an affluent middle class is increasing the
demand for mobile phones and internet in the country.

1.2.3. Cellular Service Provider in India

Table 1.2
List of Cellular Mobile (GSM, LTE & CDMA) Service Providers currently providing service
[As on 30th September, 2017]

Sr.No Service Provider Area of Operation

1 Bharti Airtel All India

2 Aircel All India*
3 Reliance Comm. Ltd. All India (except Assam & NE)

9
 4 Reliance Telecom Ltd Kolkata, MP, WB, HP, Bihar, Odisha, Aasam
and NE
5 Vodafone (India) Ltd All India
6 Tata Teleservices All India except Assam, NE & J&K
7 IDEA Cellular Ltd All India#
Delhi, Kolkata, Gujarat, Karnataka, Tamil
8 Sistema Shyam Telelink Nadu (incl. Chennai), Kerala, UP(W),
Rajasthan & W.B.
9 BSNL All India (except Delhi & Mumbai)
10 MTNL Delhi & Mumbai

11 Telenor Communications (Ind) Maharashtra, Gujarat, AP, UP(W), UP(E),

Pvt. Ltd Assam & Bihar
12 Reliance Jio Infocom Ltd All India

Table 1.3
Market share in Wireless Subscriber base (As on March 2018)

Service Provider Market Share

Bharti 25.70
Vodafone 18.82
Idea 17.85
Reliance Jio 15.76
BSNL 9.44
Aircel 6.27
Telenor 3.21
Tata 2.64
MTNL 0.30
Reliance Comm. 0.02

Source: TRAI Annual Report 2017-18

10
1.2.4 GOVERNMENT INITIATIVES IN INDIAN TELECOM SECTOR
The government has initialized fast reforms and development in the telecommunication
sector. Some of the major initiatives taken by the government for growth OF telecom
companies are as follows:-
 The MCIT (Ministry of Communications & Information Technology) has launched
online internet based communication platform “Twitter Sewa” for the purpose of
registration and resolution of complaints.
 The TRAI (Telecom Regulatory Authority of India) has published a consultation
paper which aims to provide consumers free Internet services within the net
neutrality framework and has projected three models for free data delivery to
customers without violating any rules-regulations.
 The Indian Government has liberalised the payment conditions for spectrum
auctions by allowing two payments options to telecom companies for getting the
right to use of spectrum, which includes (a) Upfront payment and (b) Payment in
instalments.
 The DoT (Department of Telecommunications) has revised the Unified Licence for
telecom business which will allow them to share telecom infrastructure like
antenna, feeder cable, transmission systems and thereby lowering down the costs
of operations and improvement towards faster rollout of telecom networks.
 The TRAI has suggested a Public and Private Partnership model for Bharat-Net, the
central government’s striving project for development in rural area’s broadband
network, and has also envisaged that, central and state governments should
become the main clients in this rural broadband project.
 The MSDE (Ministry of Skill Development and Entrepreneurship) has signed a MOU
with Department of Telecommunication to promote and implement a National
Action Plan for Skill Development in Telecommunication Sector. The purpose of this
plan is to satisfied skilled manpower demand and providing opportunities for
employment and entrepreneurship in the telecommunication sector.

11
 The TRAI has instructed the telecom companies to provide compensation to the
consumers in the case of dropped calls aiming to reduce the dropped call rates in
telecom services.
 Government has increased FDI (Foreign Direct Investment) limits in the telecom
sector form 74 per cent to 100 per cent.

1.2.5 FOREIGN DIRECT INVESTMENT INFLOW IN TELECOM SECTOR

Foreign Direct Investment has played an important role in shaping the progress and
development of the telecom sector over the years, and in financing expansion of
telecom infrastructure in the country. The FDI flows in the telecom sector in the last few
years have been observed as follows:

Year Rs. (Crore) US $ (Million)

2015-16 8,637 1,324

2016-17 37,435 5,564

2017-18 39,748 6,212

2018-19 18,337 2,668

During 2017-18 FDI equity inflow touched US $ 6.2 billion – more than four times rise
from the level of US$ 1.3 billion observed in 2015-16. However, FDI during the year
2018-19 remained at the level of US$ 2.67 billion. The substantial growth of foreign
inflows in the telecom sector indicates the faith of global community in Indian
Government policies, reforms and measures taken towards ease of doing business, as
well as in the bright prospects and future of the telecom sector in the country.10

10
DoT Annual Report 2018-19

12
1.3 RECENT TELECOM STATISTICS:
Table 1.4
(Data As on 31-3- 2019)
Telecom Subscribers Data (Wireless and Wire line)
Total Telecom Subscribers 1183.5 Million
Percentages change as compared to earlier quarter -0.79%
Telecom Subscribers (Urban) 669.2 Million
Telecom Subscribers (Rural) 514.4 Million
Market share of Private telecom Operators 88.7 %
Market share of Public telecom Operators 11.3 %
Teledensity (Overall) 90.11
Teledensity (Urban) 160
Teledensity (Rural) 57.5
Wireless Telecom Subscribers
Total Wireless Telecom Subscribers 1161.8 Million
Percentages change over the earlier quarter -1.2 %
Telecom Subscribers (Urban) 650.5 Million
Telecom Subscribers (Rural) 511.3 Million
Market share of Private Telecom Operators 89.7 %
Market share of Public Telecom Operators 10.3 %
Teledensity (Overall) 88.5
Teledensity (Urban) 155.5
Teledensity (Rural) 57.1
Total Usage of Wireless Data during the quarter 15,850,560 TB
Wire-line Telecom Subscribers
Total Wire-line Telecom Subscribers 21.7 Million
Percentages change over the earlier quarter -0.80%
Telecom Subscribers (Urban) 18.7 Million

13
 Telecom Subscribers (Rural) 3.0 Million
Market share of Private Operators 33.6%
Market share of PSU Operators 66.4%
Teledensity (Overall) 1.7
Teledensity (Urban) 4.5
Teledensity (Rural) 0.3
Number of Village Public Telephones 1.3 Lacks
Number of Public Call Office 2.5 Lacks

1.3.1 THE NUMBER OF TELEPHONE SUBSCRIBERS IN INDIA:

The number of telephone subscribers in India declined from 1,197.8 million at the end of
Dec-2018 to 1,183.5 million at the end of Mar-2019, showing a decline rate of around 1.20%
over the earlier quarter. This shows a year-on-year decline rate of around 1.88% over the
same quarter of last year. Telephone subscription in urban areas increased from 666.3
million at the end of Dec-2018 to 669.2 million at the end of Mar-2019. Rural telephone
subscription declined from 531.60 million at the end of Dec-2018 to 514.4 million at the end
of Mar-2019

Table 1.5
Trends of Telephone Subscription in India (in million)

Year Rural Urban Total

Subscriber Subscriber Subscriber
2016-17 447.77 611.56 1059.33
2017-18 501.81 693.18 1194.99
2018-19 525.87 685.93 1211.80
2019-20 514.27 669.14 1183.41

Source: DoT Annual Report 2018-19

14
 Chart 1.2

Trend of Telecom Subscription in India (in million)

1400
1194.99 1211.8 1183.41
1200 1059.33

1000

800 693.18 685.93 669.14

611.56
501.81 525.87 514.27
600 447.77

400

200

0
2016 2017 2018 2019

Rural Subscriber Urban Subscriber Total Subscriber

 Telephone subscription in Urban Areas shows increment from 611 million to 669
million during the period of March 2016 to March-19. Rural subscription also
increased from 447 million at the end of March 2016 to 514 million at the end of
March-2019.

1.3.2 WIRELESS MARKET SHARE –RURAL & URBAN SUBSCRIBERS:

Total Wireless users has declined from 1,176 million to 1,161 million during the period of
December 2018 to March 2019, which shows around 1.2% quarterly decline rate. During
the quarter, net decline of 14.2 million wireless users has been recorded. The Rural Wireless
users has declined from 528 million at the end of December 2018 to 511 million at the end
of March 2019, however the urban wireless users increased from 647 million to 650 million
during the quarter.

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1.3.3 WIRELINE SUBSCRIBER BASE
Total Wire-line user base declined from 21.8 million to 21.7 million during the period of
December 2018 to March 2019 which shows around 0.8% quarterly decline rate. Rural
wire-line users base has shown decline of 2.77%, from 3.11 Million at the end of
December 2018 to 3.02 Million at the end of March 2019. Urban wire-line subscription
also recorded decline rate of 0.46%, from 18.76 million to 18.67 million during the same
period. BSNL and MTNL, the two Public sector units, held 66.42% of the wire-line market
share as on 31st March, 2019.

1.3.4 INTERNET SERVICE

As per the operator’s reports, the total number of internet users increased from 604
million to 637 million during the period of December 2018 to march 2019, which shows
around 5.38% quarterly growth rate. Out of total 636.7 million internet users, 563.3
million were broadband users and 73.4 million were narrowband users. Wired Internet
subscribers increased from 21.42 million to 21.28 million during the period of December
2018 to March 2019, which shows around 1.19% quarterly growth rate. Wireless
Internet users increased from 582.79 million to 615.05 million during the period of
December 2018 to march 2019 which shows quarterly growth rate of around 5.54%.

1.4 IMPORTANCE OF TELECOMMUNICATION IN VARIOUS SECTORS

Telecommunication connects different parts of the world through different modes like
telephone, radio, television, satellite and internet. Telecom Industry is now considered
as an essential sector for the overall development of the country as it is contributing
towards “immense growth, quick expansion and up gradation of different sectors” of
the country.

In recent scenario communication plays very important role in the human life. Use of
various tools of telecom services is becomes an essential and integrated part of the
society. Now a days information is considered to be one of the very important factors

16
for the efficient growth of an economy. With proper use of telecommunication services,
one can remove various restraints of the other sectors which result in efficiency and
improved administration of the country. Effective and efficient controlling systems can
be implemented only through improved communication and with better use of
telecommunication equipments
The Development and balanced growth of all the sectors is very important for the
country to become super power in the world. The development of a single sector is not
sufficient, optimal use of telecom services in all the sector is needed if a country wants
to become globally superpower or if it wants to become at least self dependent. Hence,
it is necessary to see the importance of telecommunication in the various sectors in the
economy.

Infrastructure:
Infrastructure is the physical and organizational structures needed for the operation of a
society or enterprise or the services and facilities necessary for an economy to efficient
functioning. The term typically refers to the technical structures that support a society,
such as roads, water supply, electrical grids, telecommunications, etc. Viewed
functionally, infrastructure facilitates the production of goods and services; for example,
roads enable the transportation of raw materials to a factory, and also for the
distribution of finished products to markets and basic social services such as schools and
hospitals. It has been observed that transport infrastructure is extremely important for
economic development of any country which includes roads, bridges, and tunnels, and
for safe traffic various telecommunication equipments are very important for the
smooth traffic in the entire transportation sector i.e. road, rail, air and water. Use of
telecommunication devices and technology in various mode of transportation is
increasing day by day as it is needed for smooth functioning.

17
Agriculture:
This is the most essential sector in the Indian economy as our country is mostly
depending on the agriculture for its economic development. Few years ago farmers
were not in a good condition because of lack of proper information with respect to the
weather prediction, price of their commodity, proper advice from the agro expert,
market condition etc. Hence, Middlemen were exploiting the farmers as farmers were
not able to communicate with their counterpart in different parts of the country and
abroad to know about the prices and demand of their crops. But now due to the
revolution in the telecommunication sector the farmers even from rural areas, they can
take the advantage of the various telecom devices and technology. Now with help of
telecom technology farmers can discuss their problems with the expert and can take
their advice regarding farming by using different types of telecommunication devices.

Education:
The literacy rate in India is 70.04% as per the latest census survey. Though it is
improving fast but still it is behind the world literacy rate i.e. 84%. In the rural area of
the country, the condition of the education is still very poor. But due to the latest
technology in the telecommunication sector one can run a school without being
physically present there. With the use of internet technology a professor can give a
lecture from distance place to the entire classroom and even the students can ask the
questions and can clear their queries. With the use of multimedia technology students
can understand the subject very well as they practically see the things happening, they
can also appear for various online examinations by using internet facilities and can make
use of internet for their study and research work.
Distance learning, which provides an educational structure for students not in face-to-
face contact with a teacher, is an example of the dramatic changes in education and
learning activity resulting from tele-structure and tele-process. Compared to traditional
learning, teleprocessed distance learning allows many different combinations of audio-
video, and data exchange and interaction which makes learning effective and efficient.

18
Health:
Information and telecommunications technologies play very crucial role to provide and
support health care when distance separates the participants. According to Dr.
Hamadoun I Toure, If we are going to be able to deliver health care for all this new
century of connectivity, it will be through cooperation and partnership between the
technology and healthcare sectors. Telecommunication is receiving increasing attention
not only in remote areas where health care access is troublesome but also in urban and
suburban areas. Video conference is very important when the doctors are not able to
physically visit the patient place. Doctor can give advice to his counterpart with the help
of video conferencing when there are some complications in the health of a patient.
Telecommunications can also expand home health care service access through new
attachments to home telephone service, providing consultation and monitoring services
as and when needed, especially to the less mobile elderly population, while reducing the
number of trips to health centers. Care will be more cost effective when it is based on
electronic access. Personal medical records, extensive and current best medical practice
information, and consultations delivered by tele-conference to the most appropriate
location, which might be located in remote area from the health care professional is
possible only because of development of telecommunication technology.

Government Sector:
Government agencies at all levels are introducing new applications of
telecommunications for their variety of operational functions, primarily to improve the
quality of services to the public, but also to reduce the cost of providing those services
and to improve efficiency and effectiveness. Some examples of the use of
telecommunications have been in the area of document handling system, to make it
easier for agencies to process the paperwork related with issuing regulations, granting
permits, recording transfers of properties, improving the use of information to collect
taxes or assessments, and processing claims for benefits. Many of the applications of

19
telecommunications allow agencies to provide services to clients in a matter of minutes
rather than hours and by telephone rather than in person. Telecommunication
technology can be very useful during natural calamity in any part of the country. At the
time of earthquakes, floods and cyclones valuable lives can be saved with the help of
telecommunication technology.

Business Sector:
Today telecommunication is the lifeblood of all the business sector. We can’t imagine
any organization without the use of telecommunication. In every sector of business, use
of telecommunication technology is pre-requisite for efficient functioning.
Telecommunications, which is very essential for smooth business operations, is the
transmittal of data and information from one point or place to another. Telephoning,
faxing, e-mail, the World Wide Web – none of these essential services would be
available without fast and reliable telecommunications system. The concept of
electronic commerce would be impossible without efficient telecommunication system.
Managers can use telecommunication technology for better controlling and better
administration of work.
Telecommunications technology can reduce geographical distance to an irrelevant
factor. E-mail, voice mail, file transfer, faxing, cellular telephony, and teleconferencing
allow for full communication, whether among managers, between managers and their
staffs, or among different organizations. Telecommunications can also be used by a
person to monitor performance of another person in real time. Telecommunications is
used to communicate instructions and receive feedback without requiring people to
coordinate their schedules to hold a meeting. Use of e-mail has brought some secondary
benefits to business communications. Telecommunication makes the world a global
village. The distances of people from different countries gets closer and are connected.
With the help of technology, keeping in touch with other people becomes very easy and
uncomplicated.

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1.5 FACTORS FACILITATING GROWTH OF THE TELECOM SECTOR IN INDIA
The phenomenal growth in the Indian telecom industry was brought about by the
wireless technology revolution that began in the nineties. The relaxation of telecom
regulations has played a major role in the development and growth of the Indian
telecom industry. The liberalization policies of 1991 and the entry of the private players
have led the industry on a high growth path and have increased the level of healthy
competition. After the liberalization the telecom industry has received more
investments and has implemented higher technology. Besides this, the following factors
also facilitate the growth of the telecom sector.

Increasing affordability of handsets

The phenomenal growth in the Indian telecom industry was predominantly aided by the
impressive rise in wireless subscribers, which encouraged mobile handset
manufacturers to enter the market and to cater to the growing need and demand of
handsets. Further, the manufacturers introduced lower-priced handsets with add-on
facilities to cater to the increasing number of subscribers from different part of the
society. Now even entry-level handsets come with features like colored display and FM
radio. Thus, the falling handset prices and the add-on features have triggered demand
and growth of the Indian telecom industry.

Prepaid cards bring in more subscribers

In the late nineties, India has introduced to prepaid cards, which was yet another
milestone for the wireless telecom. Prepaid cards system has increased more
subscribers into the industry besides lowering the credit risk of service providers due to
its upfront payment system. Prepaid cards were quite a phenomenon among first-time
users who wanted to control their bills and students who had limited resources but are
in greater need to be connected. Pre-paid cards greatly helped the mobile market to
grow rapidly and cater to the untapped market segment. Further, the introduction of
innovative schemes like recharge coupons of smaller denominations and life time

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incoming free cards has led to a remarkable growth in the subscriber base in the
country.

Introduction of calling party pays:

The Calling party pays system was introduced in India in 2003 and under this system, the
calling party who initiated the call has to bear the entire cost of the call. This system
came to be applicable for mobile to mobile calls as well as fixed line to mobile calls. So
far India had followed the Receiving Party Pays system where the subscriber used to pay
for incoming calls also from both mobile as well as fixed line networks. Shifting to the
Calling party pay system has greatly fuelled the subscriber growth in the telecom sector.

Changing demographic profile:

The changing structure demographic profile of India has also played very important role
in subscriber growth. The changed profile is characterized by a large number of young
population, a growing middle class with growing disposable income, urbanization,
increasing literacy rate and higher adaptability to technology. These new features have
increased the need for to be connected always and to own a wireless phone and
therefore, in present times mobiles are considered as a necessity rather than a luxury.

Increased competition & declining tariffs:

Liberalization of the Indian telecom industry has fuelled intense competition, especially
in the cellular segment. The ever-increasing competition has led to high growth of
subscribers’ base and has put pressure on tariff rate, which have seen a sharp decline
over the years. When the cellular phones were introduced, call rates were at a peak of
around Rs 16 per minute and there were charges for incoming calls too. Today,
however, incoming calls are free and outgoing calls are charged at less than a rupee per
minute. Hence, the tariff war has come a long way indeed. Increased competition and
the subsequent tariff war have acted as a major driver for attracting more and more
subscribers. Apart from these major growth drivers, an improved network coverage,
entry of CDMA players, growth of value-added services, advancement in technology,
and growing data services have also driven the growth of the telecom industry.

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