Airtel

CHAPTER-III

INDUSTRY PROFILE & COMPANY PROFILE

HistoryTelecom in the real sense means transfer of information between two distant points in space. The popular meaning of telecom always involves electrical signals and nowadays people 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.Introduction of telegraphThe postal and telecom sectors had a slow and uneasy start in India. In 1850, the first experimental electric telegraph Line was started between Kolkata and Diamond Harbor. In 1851, it was opened for the British East India Company. The Posts and Telegraphs department occupied a small corner of the Public Works Department, at that time. Construction of 4,000 miles (6,400km) of telegraph lines connecting Kolkata (Calcutta) and Peshawar in the north along with Agra, Mumbai (Bombay) through Sindwa Ghats, and Chennai in the south, as well as Ootacamund and Bangalore was started in November 1853. Dr. William O'Shaughnessy, who pioneered telegraph and telephone in India, belonged to the Public Works Department. He tried his level best for the development of telecom throughout this period. A separate department was opened in 1854 when telegraph facilities were opened to the public.Introduction of the telephoneIn 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. By 1881, the Government changed its earlier decision and a licence was granted to the Oriental Telephone Company Limited of England for opening telephone exchanges at Kolkata, Mumbai, Chennai (Madras) and Ahmedabad. 28 January 1882, is a Red Letter Day in the history of telephone in India. On this day Major E. Baring, Member of the Governor General of India's Council declared open the Telephone Exchange in Kolkata, Chennai and Mumbai. The exchange at Kolkata named "Central Exchange" was opened at third floor of the building at 7, Council House Street. The Central Telephone Exchange had 93 number of subscribers. Bombay also witnessed the opening of Telephone Exchange in 1882.Further developments 1902 - First wireless telegraph station established between Saugor Islands and Sandheads. 1907 - First Central Battery of telephones introduced in Kanpur. 1913-1914 - First Automatic Exchange installed in Shimla. 23 July 1927 - Radio-telegraph system between the UK and India, with beam stations at Khadki and Daund, inaugurated by Lord Irwin by exchanging greetings with the King of England. 1933 - Radiotelephone system inaugurated between the UK and India. 1953 - 12 channel carrier system introduced. 1960 - First subscriber trunk dialing route commissioned between Kanpur and Lucknow. 1975 - First PCM system commissioned between Mumbai City and Andheri telephone exchanges. 1976 - First digital microwave junction introduced. 1979 - First optical fibre system for local junction commissioned at Pune. 1980 - First satellite earth station for domestic communications established at Secunderabad, A.P.. 1983 - First analog Stored Program Control exchange for trunk lines commissioned at Mumbai. 1984 - C-DOT established for indigenous development and production of digital exchanges. 1985 - First mobile telephone service started on non-commercial basis in Delhi.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 was only around 80,000. Even after independence, growth was extremely slow. The telephone was 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 innovative steps were taken from time to time, as for example introduction of the telex service in Mumbai in 1953 and commissioning of the first [subscriber trunk dialing] route between Delhi and Kanpur in 1960, the first waves of change were set going by Sam Pitroda in the eighties. He brought in a whiff of fresh air. The real transformation in scenario came with the announcement of the National Telecom Policy in 1994. Emergence as a major playerIn 1975, the Department of Telecom (DoT) was separated from P&T. 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 Liberalisation-Privatization-Globalization policy. Therefore, it became necessary to separate the Government's policy wing from its operations wing. The Government of India corporatised 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.TelephoneOn landlines, intra circle calls are considered local calls while inter circle are considered long distance calls. Currently Government is working to integrate the whole country in one telecom circle. For long distance calls, you dial the area code prefixed with a zero (e.g. For calling Delhi, you would dial 011-XXXX XXXX). For international calls, you would dial "00" and the country code+area code+number. The country code for India is 91.Until recently, only the PSU's BSNL and MTNL were allowed to provide Basic Phone Service through copper wires in India. MTNL is operating in Delhi and Mumbai only and all other parts are covered by BSNL. However private operators have now entered the fray, although their focus is largely on the cellular business which is growing rapidly.

Telephony Subscribers (Wireless and Landline): 562.21 million (Dec 2009)[update]Projected teledensity: 893 million, 64.69% of population by 2012. Wireless telephonesThe Mobile telecommunications system in India is the second largest in the world and it was thrown open to private players in the 1990s. The country is divided into multiple zones, called circles (roughly along state boundaries). Government and several private players run local and long distance telephone services. Competition has caused prices to drop and calls across India are one of the cheapest in the world. The rates are supposed to go down further with new measures to be taken by the Information Ministry. The mobile service has seen phenomenal growth since 2000. In September 2004, the number of mobile phone connections have crossed fixed-line connections. India primarily follows the GSM mobile system, in the 900MHz band. Recent operators also operate in the 1800MHz band. The dominant players are Airtel, Reliance Infocomm, Vodafone, Idea cellular and BSNL/MTNL. There are many smaller players, with operations in only a few states. International roaming agreements exist between most operators and many foreign carriers. The breakup of wireless subscriber base in India as of December 2009[update] is given belowOperatorSubscriber base

Bharti Airtel118,864,031

Reliance Communications93,795,613

Vodafone Essar91,401,959

BSNL62,861,214

Idea Cellular57,611,872

Tata Teleservices57,329,449

Aircel31,023,997

MTNL4,875,913

MTS India3,042,741

Loop Mobile India2,649,730

Uninor1,208,130

All India525,147,922

The list of ten states (including the metros Mumbai, Kolkata and Chennai in their respective states) with largest subscriber base as of September 2009[update] is given belowStateSubscriber baseWireless density'"

Maharashtra58,789,94951.96

Uttar Pradesh57,033,51326.32

Tamil Nadu45,449,46063.66

Andhra Pradesh37,126,04842.58

West Bengal32,540,04934.28

Karnataka28,867,73446.76

Rajasthan27,742,39539.09

Gujarat27,475,58545.49

Bihar27,434,89625.04

Madhya Pradesh24,923,73933.09

All India471,726,20537.71

Wireless density was calculated using projected population of states from the natural growth rates of 1991-2001 and population of 2001 census.LandlinesLandline service in India is primarily run by BSNL/MTNL and Reliance Infocomm though there are several other private players too, such as Touchtel and Tata Teleservices. Landlines are facing stiff competition from mobile telephones. The competition has forced the landline services to become more efficient. The landline network quality has improved and landline connections are now usually available on demand, even in high density urban areas. The breakup of wire line subscriber base in India as of September 2009[update] is given belowOperatorSubscriber base

BSNL28,446,969

MTNL3,514,454

Bharti Airtel2,928,254

Reliance Communications1,152,237

Tata Teleservices1,003,261

All India37,306,334

The list of eight states with largest subscriber base as of September 2009[update] is StateSubscriber base

Maharashtra5,996,912

Tamil Nadu3,620,729

Kerala3,534,211

Uttar Pradesh2,803,049

Karnataka2,751,296

Delhi2,632,225

West Bengal2,490,253

Andhra Pradesh2,477,755

COMPANY PROFILE

bharti airtel limited is a leading global telecommunications company with operations in 19 countries across Asia and Africa. The company offers mobile voice & data services, fixed line, high speed broadband, IPTV, DTH, turnkey telecom solutions for enterprises and national & international long distance services to carriers. bharti airtel has been ranked among the six best performing technology companies in the world by business week. bharti airtel had 200 million customers across its operations. Highlights 2012Bharti Airtel appoints Suren Goonewardene as CEO Sri Lanka Bharti Airtel to Observe Silent period from December 31, 2011 Airtel Mobitude 2011 reveals data traffic trends on mobile devices in India Friends on Airtel can now use Gifting Services and Call Me Back SMS alerts Bharti Airtel recognized for the delivery of best network services with customer focus at Telecom Centre of Excellence Awards 2011 Airtel Mobitude 2011 captures preferences of over 170 million plus mobile users

Highlights 2011

airtel makes its 3G debut

airtel digital TV brings in a la carte offerings for its customers

bharti airtel to announce its results for third quarter ended December 31, 2010 on Feb 2, 2011 (Wednesday)

bharti airtel to announce its results for third quarter ended December 31, 2010 on Feb 2, 2011 (Wednesday)

SBI and airtel join hands to usher in a new era of financial inclusion for unbanked India

bharti airtel to observe silent period from december 31, 2010

Airtel comes to you from Bharti Airtel Limited, one of Asias leading integrated telecom services providers with operations in India, Sri Lanka and Bangladesh. Bharti Airtel since its inception has been at the forefront of technology and has pioneered several innovations in the telecom sector.The company is structured into four strategic business units - Mobile, Telemedia, Enterprise and Digital TV. The mobile business offers services in India, Sri Lanka and Bangladesh. The Telemedia business provides broadband, IPTV and telephone services in 95 Indian cities. The Digital TV business provides Direct-to-Home TV services across India. The Enterprise business provides end-to-end telecom solutions to corporate customers and national and international long distance services to telcos. Airtel was born free, a force unleashed into the market with a relentless and unwavering determination to succeed. A spirit charged with energy, creativity and a team driven to seize the day with an ambition to become the most globally admired telecom service. Airtel, in just ten years of operations, rose to the pinnacle to achievement and continues to lead.As India's leading telecommunications company Airtel brand has played the role as a major catalyst in India's reforms, contributing to its economic resurgence.Today we touch peoples lives with our Mobile services, Telemedia services, to connecting India's leading 1000+ corporate. We also connect Indians living in USA, UK and Canada with our call home service.Our Vision & promiseBy 2010 Airtel will be the most admired brand in India:Loved by more customersTargeted by top talentBenchmarked by more businessesWe at Airtel always think in fresh and innovative ways about the needs of our customers and how we want them to feel. We deliver what we promise and go out of our way to delight the customer with a little bit more

Airtel comes to you from Bharti Airtel Limited, one of Asias leading integrated telecom services providers with operations in India, Sri Lanka and Bangladesh. Bharti Airtel since its inception, has been at the forefront of technology and has pioneered several innovations in the telecom sector.The company is structured into four strategic business units - Mobile, Telemedia, Enterprise and Digital TV. The mobile business offers services in India, Sri Lanka and Bangladesh. The Telemedia business provides broadband, IPTV and telephone services in 95 Indian cities. The Digital TV business provides Direct-to-Home TV services across India. The Enterprise business provides end-to-end telecom solutions to corporate customers and national and international long distance services to telcos. Highlights

Bharti Airtel and Apple to Bring iPhone 3GS to India

Indias first mobile application store Airtel App Central - clocks over 2.5 million downloads in just 30 days

Dow Jones and Bharti Airtel Partner for Launch of The Wall Street Journal India Mobile

Airtel Broadband - official Broadband Sponsor of Cricket on YouTube

Bharti Airtel makes its Media & Entertainment debut launches Digital Media Business

Bharti Airtel Completes Deployment of the Bangalore Traffic Police Enforcement Automation System on BlackBerry Smartphones

We are one of Asias leading providers of telecommunication services with presence in all the 22 licensed jurisdictions (also known as Telecom Circles) in India, and in Srilanka. We served an aggregate of 113,439,670 customers as of September 30, 2009; of whom 110,511,416 subscribe to our GSM services and 2,928,254 use our Telemedia Services either for voice and/or broadband access delivered through DSL. We are the largest wireless service provider in the country, based on the number of customers as of September 30, 2009. We offer an integrated suite of telecom solutions to our enterprise customers, in addition to providing long distance connectivity both nationally and internationally. We also offer DTH and IPTV Services. All these services are rendered under a unified brand Airtel.

The company also deploys, owns and manages passive infrastructure pertaining to telecom operations under its subsidiary Bharti Infratel Limited. Bharti Infratel owns 42% of Indus Towers Limited. Bharti Infratel and Indus Towers are the two top providers of passive infrastructure services in India.

Partners Network EquipmentNetwork EquipmentNokia Siemens, Ericsson, Huawei

Telemedia & Long Distance ServicesNokia Siemens, Wipro, Cisco, Alcatel Lucent, ECI, Tellabs

Information TechnologyIBM

Call Centre OperationsIBM Daksh, Hinduja TMT, Teleperformance,Mphasis, Firstsource & Aegis

Equity Partner {Strategic}Singtel

FactsheetAt-a-glance guide to Bharti Airtel Organization StructureOrganisation chart depicting the Senior Management positions Shareholding StructureDetails on the latest shareholding structure and major shareholders. Awards & RecognitionsLaurels recognising Bharti's consistent efforts.

Bharti Airtel and Apple to Bring iPhone 3GS to India

Indias first mobile application store Airtel App Central - clocks over 2.5 million downloads in just 30 days

Dow Jones and Bharti Airtel Partner for Launch of The Wall Street Journal India Mobile

Airtel Broadband - official Broadband Sponsor of Cricket on YouTube

Bharti Airtel makes its Media & Entertainment debut launches Digital Media Business

Bharti Airtel Completes Deployment of the Bangalore Traffic Police Enforcement Automation System on BlackBerry Smartphones

Factsheet

NameBharti Airtel Limited.

Business DescriptionProvides GSM mobile services in all the 22 telecom circles in India, and was the first private operator to have an all India presence.Provides telemedia services (fixed line and broadband services through DSL) in 95 cities in India.

EstablishedJuly 07, 1995, as a Public Limited Company

Proportionate RevenueRs. 369,615 million (year ended March 31, 2009-Audited)Rs. 113,715 million (year ended March 31, 2008 - Audited)As per US GAAP Accounts

Proportionate EBITDARs. 151,678 million (year ended March 31, 2009 - Audited)Rs. 113,715 million (year ended March 31, 2008 - Audited)As per US GAAP Accounts

Shares in Issue3,796,951,980 as at Dec 31, 2009

ListingsThe Stock Exchange, Mumbai (BSE)The National Stock Exchange of India Limited (NSE)

Market Capitalisation

Customer Base118,864,031 GSM mobile and 2,988,545 Telemedia Customers (status as on Dec 31, 2009)

Operational NetworkProvides GSM mobile services in all the 22 telecom circles in India, and was the first private operator to have an all India presence.Provides telemedia services (fixed line) in 95 cities in India.

Registered OfficeBharti Airtel Limited(A Bharti Enterprise)Bharti Crescent, 1 Nelson Mandela Road, Vasant Kunj Phase IINew Delhi - 110 070Tel. No.: +91 11 4666 6100Fax No.: +91 11 4666 6411

Organization StructureAs an outcome of a restructuring exercise conducted within the company; a new integrated organizational structure has emerged; with realigned roles, responsibilities and reporting relationships of Bhartis key team players. With effect from March 01, 2006, this unified management structure of 'One Airtel' will enable continued improvement in the delivery of the Groups strategic vision.

Bharti Airtel - Organization Structure

Management ProfilesSunil Bharti Mittal

Manoj Kohli

Sanjay Kapoor

David Nishball

Atul Bindal

K Srinivas

Jyoti Pawar

Shamini Ramalingam

Joachim Horn

S. Asokan

Krishnamurthy Shankar

Srikanth Balachander

Sunil Bharti Mittal is the Founder, Chairman and Group CEO of Bharti Enterprises, one of Indias leading business groups with interests in telecom, financial services, retail, realty, manufacturing and agriculture.

Sunil started his career at 18 after graduating from Punjab University in India in 1976 and founded Bharti. Today, at 52, he heads a successful enterprise which employs over 30,000 people. Bharti Airtel, the flagship group company, has a market capitalization of approximately US$ 25 billion.

Sunil has been recognized with the Padma Bhushan, one of Indias highest civilian awards. He has also received the Lal Bahadur Shastri National Award for Excellence in Public Administration, Academics and Management for 2009. He is a past President of the Confederation of Indian Industry, the premier industry body in India (2007-08).

Sunil has been awarded numerous awards and recognitions including the Global Economy Prize 2009 by The Kiel Institute, Germany. The US-India Business Council has also honored him with the Global Vision Award 2008. He has received the GSM Association Chairman's Award for 2008.

Sunil was Co-chairman of the World Economic Forum in 2007 at Davos and is a member of its International Business Council. He is a member of the Leadership Council of The Climate Group. He is also a member of the Board of Trustees of the Carnegie Endowment for International Peace. He is a member of several premier international bodies International Advisory Committee to the NYSE Euronext Board of Directors, the International Business Advisory Council of London and the Advisory Board of the Global Economic Symposium. Sunil is also on the Telecom Board of the International Telecommunication Union, the leading UN Agency for Information and Communication Technology. He is also a member of the Indo-US CEOs Forum.

He serves as a member of the Executive Board of the Indian School of Business. He is also a member of the Academy of Distinguished Entrepreneurs, Babson College, Wellesley, Massachusetts.

Sunil believes a responsible corporate has a duty to give back to the community in which it operates. This belief has resulted in Bharti Foundation, which is committed to providing education to under-privileged children in rural India.

Sunil has been conferred with the degree of Doctor of Laws (Honoris Causa) by the University of Leeds, UK and the degree of Doctor of Science (Honoris Causa) by the Govind Ballabh Pant University of Agriculture & Technology. He is an alumnus of Harvard Business School, USA. He is an Honorary Fellow of The Institution of Electronics and Telecommunication Engineers.

AWARDS:for the year 2010 - 2011 airtel has won the Most Preferred Cellular Service Provider Brand award at the CNBC Awaaz Consumer Awards in Mumbai. This is 6th year in a row that airtel has won the award in this category. This year, the awards were based on an exhaustive consumer survey done by The Nielsen Company. Over 3,000 consumers, spanning 19 cities and 16 states in India, rated brands across different categories to choose brands which delivered true value for money.

bharti airtel has received the prestigious Businessworld-FICCI-SEDF Corporate Social Responsibility Awards 2009-2010. The FICCI Socio Economic Development Foundation (FICCI-SEDF) and Businessworld CSR award was instituted in 1999 to recognize exemplary responsible business practices by the Indian Industry.

Tariffs PlansNEW

airtel Turbo Plan 2 (airtel/AP/GSM/04)

airtel Turbo Plan 1(airtel/AP/GSM/02)

New Advantage Plan (airtel/AP/GSM/01)

SUK 35(airtel/AP/GSM/14)

MNP 25(airtel/AP/GSM/03)

HFZ Pack(airtel/AP/GSM/15)

Airtel Turbo Plan 2 (airtel/AP/GSM/04) Expand All Collapse All ONE TIME CHARGESPulse Rate1 sec pulse

Price of Pack (Rs.)43

Free Airtime on Pack (Rs.)0

Incoming Calls (Rs.) 0

CALL CHARGESAirtelGSM/CDMALandline

Local Rates1.2 p/sec1.2 p/sc1.5p/sec

STD Rates1.2 p/sec1.2 p/sec1.5 p/sec

SMSLocal 1

National 1.5

International 5

OTHER DETAILS

Special 1 sec Roaming tariff is as following. Validity is for 1 year. Local Outgoing (Local airtel to airtel) Rs. 0.60 min Local Outgoing (Local airtel to Other Mobile & Landline) 0.80 / min STD Outgoing (STD airtel to airtel) Rs. 0.60 / min STD Outgoing (STD airtel to other Mobile & Landline) 0.80 / min Incoming Rs. 0.60 / min ISD Rs. Standard Rates at 60 sec pulse

Ombudsman Office Head ArrowCorporate GovernanceBharti Enterprises Limited (including its group and Joint Venture companies) firmly believes in the principles of Corporate Governance and is committed to ensure sustainable, capital-efficient and long-term growth thereby maximizing shareholder value. The companys commitment towards compliance to the highest governance standard is backed by an independent and fully informed board, comprehensive processes, policies and communication. The Company ensures that various disclosure requirements are complied in letter and spirit for effective Corporate Governance. We adhere to the highest levels of ethical business practices as articulated by our Code of Conduct so as to achieve our performance with integrity. Office of the OmbudspersonThe Office of the Ombudsperson is an independent forum for employees and external stakeholders of the company to raise concerns and complaints about improper practices which are in breach of the Bharti Code of Conduct. Any stakeholder (employee, associate, strategic partner, vendor) who observes unprofessional behaviour can approach the Ombudsperson to voice his or her concerns. The complainant may be either an observer who is not directly impacted, or a victim who is directly or indirectly affected by such practices. The Office aims to provide a fair and equitable redressal mechanism. The process is designed to offer protection to the complainant provided the disclosure is made in good faith and the alleged action constitutes a genuine and serious breach of Bharti Code of Conduct. The Ombudsperson will treat all disclosures in a confidential and sensitive manner. A person can raise a concern, either verbally or in writing by giving background of the unprofessional conduct, reasons for raising the concern, the identity of the individuals who may be involved and documentary evidence, wherever available. 1) In writing (through hard copy mail) to:The OmbudspersonBharti Enterprises Ltd.Bharti Crescent1, Nelson Mandela RoadVasant Kunj, Phase IINew Delhi 110 070, India.