Bharti Enterprises Essay

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  • Words: 447
  • Category: Database

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Indian telecommunication Industry is one of the fastest growing telecom market in the world. The mobile sector has grown from around 10 million subscribers in 2002 to reach 930 million by early 2012 registering an average growth of above 90%. The two major reasons that have fuelled this growth are low tariffs coupled with falling handset prices. The other reason that has tremendously helped the telecom Industry is the regulatory changes and reforms that have been pushed for last 10 years by successive Indian governments. According to Telecom Regulatory Authority of India (TRAI) the rate of market expansion would increase with further regulatory and structural reforms. Even though the fixed line market share has been dropping consistently.

Three telecom players dominate this market – Bharti Airtel with 19.5% market share, Reliance Communication with 16.7% and Vodafone with 16.4% followed by Idea around 12% and then BSNL having market share of around 11%.

Sunil Bharti Mittal founded the Bharti Group. In 1986, Mittal incorporated Bharti Telecom Limited (BTL), and his company became the first in India to offer push-button telephones, establishing the basis of Bharti Enterprises. In 1995, Mittal incorporated the cellular operations as Bharti Tele-Ventures and launched service in Delhi, and subsequently extended the operations to Himachal Pradesh, Karnataka and Andhra Pradesh and other states. This expansion allowed it to offer voice services all across India. In 2009, Airtel launched its first international mobile network in Sri Lanka.In March 2012; Airtel launched a mobile operation in Rwanda. Today, Airtel is the largest cellular service provider in India and the third largest in the world.

BSNL then known as the Department of Telecommunications had been a near monopoly during the socialist period of the Indian economy. During this period BSNL operated as a typical state-run organization, inefficient, slow, bureaucratic, and heavily unionized being a monopoly.

Faced with stiff competition from the private telecom service providers, after liberalization, DoT has subsequently tried to increase efficiencies itself. The corporation (then DoT), however, failed to achieve this and India languished among the most poorly connected countries in the world. BSNL was born in 2000 after the corporatization of DoT.

The corporatization of BSNL was undertaken by an external international consulting team consisting of a consortium of A.F.Ferguson& Co, JB Dadachanji and NM Rothschild – and was probably the most complex corporatization exercise of its kind ever attempted anywhere because of the quantum of assets (said to be worth USD 50 Billion in terms of breakup value) and over half a million directly and indirectly employed staff. The corporation remains heavily unionized and is comparatively slow in decision making and its implementation, which largely acts at the instances of unions without bothering about outcome. Management has been reactive to the schemes of private telecom players.

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