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Telecom Industry in India

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Telecom Industry in India

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 The telecommunication Industry in India has raised many brows throughout the world as it is the “world’s fastest growing industry”, with 851.70 million mobile phone subscribers as of June 2011.  It is also the second largest telecommunication network in the world in terms of number of wireless connections after China. 

Many people say that large population is one of the major problems India face, but the great minds of telecom industry take it as a boon. More population means more consumption. Hence India is indeed heaven for any such business. Today’s telecom industry is not a result of a day or two, but has evolved over a long period of time. 
 
Centuries back people used pigeons to send a message to a faraway place. Though that was the beginning of a telecom era as telecom in the real sense means the transfer of information between two distant points in space, yet the general meaning of telecom involves electrical signals and as a result, people often exclude postal or any other raw telecommunication methods from its meaning. Therefore, the history of Indian telecom can be started with the introduction of telegraph.
 
The conch-blow of telecom industry in India was heard with the introduction of telegraph in 1850. The first experimental electric telegraph line was started between Kolkata and Diamond Harbor. In 1851, it was opened for the use of the British East India Company. Subsequently, the construction of 6,400 km of telegraph lines connecting Kolkata and Peshawar in the north along with Agra, Mumbai through Sindwa Ghats, and Chennai in the south, as well as Ootacamund andBangalore was started in November 1853. In 1854 telegraph facilities were opened to the public. The telegraph industry saw a slow and uneasy start.
 
A boom came in Indian telecom industry with the introduction of telephone in 1880. Two telephone companies namely The Oriental Telephone Company Ltd. and The Anglo-Indian Telephone Company Ltd. approached the Government of India to establish telephone exchanges in India. The permission was refused on the grounds that the establishment of telephones was a Government monopoly and that the Government itself would undertake the work. In 1881, the Government later reversed its earlier decision and a license was granted to the Oriental Telephone Company Limited of England for opening telephone exchanges at Calcutta, Bombay, Madras and Ahmedabad and the first formal telephone service was established in the country. Later in 1882, Bombay also witnessed the opening of a telephone exchange.
 
While all the major cities and towns in the country were linked with telephones during the British period, the total number of telephones in 1948 numbered only around 80,000. Post independence, growth remained slow because the telephone was seen more as a status symbol rather than being an instrument of utility. The number of telephones grew leisurely to 980,000 in 1971, 2.15 million in 1981 and 5.07 million in 1991, the year economic reforms were initiated in the country. While certain measures were taken to boost the telecom industry from time to time, the real transformation in scenario came with the announcement of the National Telecom Policy in 1994.
 
Department of Telecom (DoT) was responsible for telecom services in entire country until 1985 when Mahanagar Telephone Nigam Limited (MTNL) was carved out of DoT to run the telecom services of Delhi and Mumbai. In 1990s the telecom sector was opened up by the Government for private investment as a part of Liberalization-Privatization-Globalization policy. Therefore, it became necessary to separate the Government's policy wing from its operations wing. The Government of India corporatized the operations wing of DoT on 1 October 2000 and named it as Bharat Sanchar Nigam Limited (BSNL). Many private operators, such as Reliance Communications, Tata Indicom, Vodafone, Loop Mobile, Airtel, Idea etc. successfully entered the high potential Indian telecom market.
 
The Indian telecom industry has witnessed a significant upswing since privatization and is presently on a high speed growth path, enjoying a growth rate of 45 % p.a., among the highest in the World. India currently has 550 million telecom subscribers, translating to a tele-density of 46%. According to Business Monitor International, India is currently adding 8-10 million mobile subscribers every month. It is estimated that by the end of 2012, around half the country's population will own a mobile phone. This would translate into 612 million mobile subscribers, accounting for a tele-density of around 51%. 
 
Privatization of telecom industry in India has definitely revolutionized the entire telecom scenario. Innovations and development in technology has also played an important role in redefining the Indian telecom industry. Customers enjoy “n” number of facilities these days that include- internet broadband connection 2G, 3G, low tariff rates and many more. As a matter of fact India today boasts of the lowest telecom tariffs in the world.
 
The future of telecom industry in India is indeed bright and it seems that the “fastest growing industry of the world- THE INDIAN TELECOMMUNICATION INDUSTRY”, certainly won’t go on a “silent mode” for many decades to come.
 
For such topics of Basic understanding on the subject matter which will motivate you to kick start preparation for CAT 2011 alongwith various other MBA entrance tests. This would also be useful for extempore speaking  / Essay writing / GD & PI sessions, please keep on visiting www.mbarendezvous.com ,Portal with Management by objective approach.
 

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