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India - A Potential 3G Market A Feasibility Study

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India - A Potential 3G Market A Feasibility Study

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    1. India - A Potential 3G Market A Feasibility Study

    2. 3G SERVICES & INDIAN MARKET

    3. 3G SERVICES & INDIAN MARKET

    4. Market Trends

    5. 3G SERVICES & INDIAN MARKET

    6. Existing Market Competition Stake in Existing Market : Technology relied upon : Total Investment : Analyzing the predicted Market Revenue Trends, expected Break Even Period for Vodafone BHARTI (10%) GSM (Larger service range in India) 1.5 billion USD

    7. 3G SERVICES & INDIAN MARKET

    8. Business Base Current Position of Reliance in market - 20.3 % of the subscriber population - Largest CDMA provider in India

    9. 3G SERVICES & INDIAN MARKET

    10. Technology Requirements

    11. 3G SERVICES & INDIAN MARKET

    12. Cost Structure

    13. Cost Structure

    14. Estimated Breakup of Expenses

    15. 3G SERVICES & INDIAN MARKET

    16. Service Promotion

    17. 3G SERVICES & INDIAN MARKET

    19. Thank You!

    20. References

    23. Computation Steps under Packet-Wise Billing Current Internet User Count=38.5million2 Reliance Subscriber Count=20.3%of 38.5=7.82million Targeted Youth Population=54%of 7.82=4.22million Customer Base for Reliance=11.65million(data provided) Ratio for Target Customer for 3G= 4.22/11.65 = 0.36 Considering this ratio remaining constant, Revenue earned within the breakeven period limits:: ? Revenue earned by telephony ? Revenue earned by internet usage

    24. Computation Steps cont.. Revenue earned by telephony: ? ARPU(t)xsub.population(t) = Area under the Revenue Curve? = 1485.76 billion INR Revenue earned by internet usage: =Charge per packet ( C ) x Avg.Packetconsumption (APC) x Ratio of Target Customers x ?Sub.population(t) = 0.5x8192x0.36x{Area under the Subscriber Poplulation Curve}? =5558.501 billion INR Total Revenue =7044.26billionINR

    25. Computation Steps cont. Total Revenue = 7044.26 billion Total Reliance Revenue = 20.3% of 7044.26 = 1429.99 billion If acquired a 10% stake, Returns to the company = 10% of 1429.99 ˜ 143 billion >> 115 billion (investment cost)

    26. Vodafone’s Returns: Computation steps for the Breakeven Based on the Plot? Returns(t) = Area Under the Plot = 10667.93 +89.71 t2 +833.56 t (billions) Returns till Breakeven period = 1.5 billion USD = 63000 million INR* Solving for t: t =19.95 months ˜ 20 months? By February 2008.

    27. Aiming the technology Source: CDG, AUSPI, TelecomWatch,COAI, TRAI Wireless growth after introduction of CDMA4: Subscriber growth in GSM: CAGR of 74%* Subscriber growth in CDMA: CAGR of 205%* Increase in Teledensity: 6%* Decrease in tariff: 75%*

    28. Indian Market Feasibility

    29. TARGETED CUSTOMER : THE YOUTH? 54% of the population is below the age of 24 Estimated youth’s annual spending ?US$10.5bn with growth rate of 12%1 55% of young India opts for career in web related activities3 Demand for internet access (38.5 Mn currently) may shoot up to 100 Mn in 2 years.

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