Emerging Trends In Telecom Sectors Information Technology Essay

Telecom industry has the maximum potential to grow in the recent economic scenario. The impact on the telecom sector is less severe when we compare it with the other sectors of the economy which are affected by the recent economic recession. If organizations decide to reduce their costs & expenditures, it might lead to growth in some parts of the telecom industry. There are many new methods which can be adopted such as work from home, video conferencing, etc. which can help booster the telecom industry. All these leads to a need for reliable communication which is provided by upgrading the existing IP networks, more penetration of fiber in the access network & rapid development & deployment of other associated technologies. So, considering the above factors we classify the emerging trends in the telecom industry into Customers (who purchase the services), Operators (who sell those services) & Equipment Vendors (who make those services technically feasible & available).

Customers always look for high quality, value for money & a variety of choices at their disposal at minimum cost. Important areas to focus are:

Quality: High quality of services for voice, data should be offered to customer for better communication at all times.

Quantity: Variety of different services like data, voice, video & mobility should be made available at all times from the same device & at high data speeds.

Cost: Customers want the telecom services at low & affordable rates & they expect the trend of declining rates even in the near future. 

Operators

Important areas as opportunities for operators are:

Customer care – Customers should be provided a pleasant experience & a variety of choices in terms of product packages & different technologies.

Outsourcing: The network & other I.T. related functions should be outsourced so that one can focus on its core aspects of business.

Inside building coverage – It is expected that more than 70% of voice & data calls would be originating indoors. So, good coverage must be ensured for this even if this leads to sharing of network resources with their competitors.

Coverage/Penetration in Rural areas – Companies should try to penetrate & enhance their coverage & communication in rural areas more effectively.

Fuel bill reduction – Operators should try to reduce their fuel & power consumption levels by the use of various new technologies. This also leads to approvals better environment conditions & approvals.

Source: http://www.consultingnetwork.co.in/emerging-trends-in-telecom-by-ashutosh-madan/416/

Emerging Technologies in Telecommunication

Technology advancements are driven by the applications which customers find appealing and solve the operational issues faced by operators. Some of the key ones which can be described as emerging technologies & growth avenues for the Telecom sector are shown in the below figure.

3G (Third Generation Mobile Services)

Customers want to use the triple play services (Voice, Data and Video) all the time and everywhere – indoor or outdoor. Multi-billion dollars are being invested in development and enhancement of mobile technologies like 3G & WiMAX.

It offers voice capacity that is four to five times higher than that of 2G services. Therefore, it is an ideal platform for low-cost cellular services. It can fulfill the need of fast developing mobile penetration in rural areas. It can meet the demand for high-

Speed data and content rich services in the urban landscape. It can be a way forward to achieve the Government’s broadband objectives. In addition, it will be a good solution for education, telemedicine, etc.

WiMAX (Worldwide Interoperability for Microwave Access)

WiMAX has been one of the most significant developments in wireless communication in the recent past. This mode of communication provides network access in inaccessible areas at high speed of data. So, it can lead to an increased use of various telecom, value added & internet services. It is also an economically feasible option as the resource requirement is comparatively less. Installing WiMAX will facilitate the broadband accessibility within a radius of 25 kilometres. Voice over Internet Protocol (VoIP) will make it possible to telecast entertainment programs in remote areas. Improved communication could integrate remote villages with the world economy. It can be used for national literacy programs for rural students by the use of videoconferencing.

Infrastructure Sharing

To increase their productivity as well as reduce the operational costs, many service providers are opting for infrastructure sharing.Infrastructure sharing promises several advantages:

• Significant reductions in equipment set up costs.

• Increased environmental conditions & operations.

• Lower costs of operations for individual service providers.

• Service quality is improved.

• Increased affordability for customers.

• Ease & faster roll out of various services in rural and remote areas.

Virtual Private Network (VPN)

Virtual Private Network is a private data network which provides connectivity within closed user groups via public telecommunication infrastructure. It is similar to leasing/owning lines but still getting exclusive or private access. Sharing of the public infrastructure makes it a less expensive option and it is known as Closed User Group (CUG). Due to the emergence of the telecom market, various CUG tariff plans have been introduced in the voice telephony segment, which primarily target groups comprising of a large family, friends or colleagues.

Rural Telephony

The rural market holds great potential for telecom companies. Rural telephony will require major investments in the near future as the Government is planning to increase rural teledensity from the current level of 4-6 per cent. This segment will boost the demand for telecom services, equipment, internet services and other value added services, thereby offering a great market opportunity for telecom players. The government has a target to achieve 40% rural teledensity by 2012 & reduce urban-rural digital divide from present 25:1 to 5:1 by 2010.

Source: http://www.scribd.com/doc/19526600/telecom

Future of Telecommunication Sector

India is the fastest growing free market democracy in the world. It has a mature and dynamic private sector, which accounts for 75 per cent of India’s GDP, and a market with enormous potential due to its large size and diversity. The most important reasons for the growth of private industries in India are stable economic outlook, large market potential which varies according to size, income, consumption, etc. & Government regulations which facilitate industrial growth.

The Union Government has taken various steps in line with strategy to spur Telecom Sector Growth. These are as follows:

Opening up of its telecom sector to foreign investors up to 100 percent holding in manufacturing of telecom equipment, internet services, and infrastructure providers (e-mail and voice mail), 74 percent in radio-paging services, internet (international gateways) and 49 percent in national long distance, basic telephone, cellular mobile, and other value added service.

Decision of not capping on the number of access providers in any service area. 122 new UAS licenses were granted in 2008 to 17 companies in 22 service areas for benefit of consumers by increased competition.

Permission of dual technology spectrum.

Decision to introduce Mobile Number Portability (MNP) that will allow subscribers to retain their existing numbers while switching over from one service provider to another.

Conclusion of Auction of 3G/BWA Spectrum in 22 circles for Telecom Service Providers. Rollouts expected by the end of 2010.

Source: http://pib.nic.in/release/release.asp?relid=64813

Combining these efforts made by the government & the economic stability prevalent in the country, there have been estimates of prosperous growth for Indian Telecom sector till 2013. The future estimates are as follows:

The revenues for the Telecom sector would cross the $30 billion mark by 2013 with a compound annual growth rate (CAGR) of 12.5 percent from the year 2009-2013.

The subscriber base for Telecom would cross the 770 million mark by the year 2013 & is expected to grow at a CAGR of 12.5 percent.

Mobile market penetration is expected to increase to 63.5 percent in 2013 from 38.7 percent in 2009.

The rate at which a subscriber switches/changes their operator (churn rate) – would increase from the current 56% to 59% by 2013.

The number of prepaid connections which comprise for 93 percent of the total subscriber base in 2008 will continue to further increase to 96 percent by 2013, exceeding the 740 million mark.

The revenues from data services like internet will contribute significantly to the telecom services, with a CAGR of 16.8% from 2009 to 2013.

The increased usage of various value-added services would also help in increasing the revenues, which are relevant to both rural and urban markets.

Source:http://www.watblog.com/2009/06/22/indian-telecom-sector-future-growth-predictions-by-gartner/