SALES PROMOTIONAL ACTIVITIES

Promotion is true that products are manufactured to satisfy the needs of the consumers.. But alone is not enough. Today the responsibility of the manufacturers does not cease with physical production whatever may be the nature of the product. The present day marketers are consumer oriented where it is the duty of the manufacturers to know from where, when, how and what price the products would be available. Successful marketing consists in offering the right product of the right price of the right place (and time) with right promotion. In course of time, various activities came into vogue designed particularly to help easy sale of goods. These activities commonly known as promotional Mix. The marketing communication Mix also called as the Promotion Mix consists of four major tools. 1. Advertising. 2. Sales Promotion 3. Publicity 4. Personal Selling

MARKETING COMMUNICATION PROCESS:

Generally marketing communication is undertaken to pass on the message of a product or sale to the ultimate consumers. Thus, there are three elements in this process.

IMPORTANCE OF ADVERTISING:
The purpose of advertising is motivating but to sell something a product, a service or an AIRTEL. The real objective of advertising is effective communication between producers and consumers. In other words the ultimate purpose all advertising is Increased awareness list of the following specific objectives of advertising. To make on immediate AIRTEL To build primary demand To introduce a price deal To inform about a products availability 1

To increase market share To help salesman by building on awareness of a product among retailers To increase the frequency use of a product. To build overall company image To build brand recognition

OBJECTIVES OF THE STUDY

To know the customer opinion about tariff rates of Airtel. To know the brand loyalty of Airtel. To know the influencing factors of Airtel. To know the market share of the Airtel. To know the sources of awareness for the customers. To know the customer satisfaction on network of Airtel. To know the satisfaction on Services Provided by Airtel. 2

 To know the satisfaction of customers on Recharge and Top up cards when compare to other competitors.

RESEARCH METHODOLOGY One of the important tools for conducting marketing researching is the availability of necessary and useful data. Data collection is more of an than science the methods of marketing research are in a way the methods of data collection. The sources of information fall under two categories. Internal sources: Every company has to keep certain records such as accounts, records, reports, etc., these records provide sample information which can organizations usually keeps collecting in its working. External sources: When internal records are insufficient and required information is not available, the organizations will have to depend on external sources. The external sources of data are: Primary data: Primary data are data gathered for a specific purpose or for a specific research report. For systematically collecting the data the closed end questionnaire is used. The questionnaire consists of questions relating to various aspects of the study for proper data collection the questionnaire is divided into 2 sections. Both the sections are meant for the respondent only.

Secondary data: Secondary data are data that are collected for another purpose and already exist somewhere. Data pertaining to company is collected from company web site 4

company catalogues and magazines. The company profile gives a detailed report of history various products manufacture by its etc. METHOD OF RESEARCH SURVEY METHOD: A survey is a complete operation, which requires some technical knowledge survey methods are mostly personal in character. Surveys are best suited forgetting primary data. The researcher obtains information from the respondents by interviewing them. SAMPLING: It is not always necessary to collect data from whole universe. A small representative sample may serve the purpose. A sample means a small group should be emanative cross section and really representative in character. This selection process is called sampling. SAMPLE SIZE: Samples are devices for learning about large masses by observing a few individuals. The selected sample is 25.

Sampling plan: 1.SAMPLING UNIT -The business people, professionals are survived 2. SAMPLING PROCEDURE - Stratified random sampling method is chosen. The data collected from both the primary and secondary sources is tabulated and presented in a systematic from prior to classification and interpretation. METHOD OF SAMPLING RANDOM SAMPLING METHOD The method adopted here is random sampling method. A random sample is one where each item in the universe has as equal chance of known opportunity of being selected. RESEARCH INSTRUMENT QUESTIONNAIRE: A Questionnaire is carefully completed logical sequence of question directed to a define objective. It is the out line of what information is required and the framework on which the data is built upon. Questionnaire is son commonly used in securing market information that its preparation deserves utmost skill and care.

FORMS OF QUESTIONS OPEN ENDED QUESTIONS: They are descriptive in nature. Respondents are allowed to answer in their own words. Such questions buying the actual opinion of the respondent r Regarding a product. CLOSED ENDED QUESTIONS: They are not descriptive in nature. They will be given certain choices and the respondents have to choose choice among them. They make analysis easy but sometimes they restrict the respondents choices. 6

TYPES OF CLOSED ENDED QUESTIONS: DICHOTAMS: MULTIPLE CHOICE: RATING SCALE: excellent. a question offering two answers choice. a question offering three choices. a scale that rates some attributes from poor to

LIMITATIONS 1. Time is the main limitation for the study, as project was restricted only for 45 days. 2. The methods used in this project are random sampling methods and results obtained may not be accurately fully accurate and believable. 3. The research has been centered to only Two hundred Customers of Airtel, rather than innumerable Customers dealing with different products of different brands across the globe. 4. The analysis is purely based on closed ended questions and due their deliberate manipulation, important information may be lost and even barriers of communication would cause a limitation. 5. 6. The whole project research was confined to only customers of Airtel The research was done with the help of employees of the organization for some of the dealers and their barriers of communication or way to represent the topic would differ and actual information would be lost. 7

7.

The dealers responded during the survey were possessing primary education and their views would not be able to provide the required information.

CHAPTER-II Company profile

INTRODUCTION "As we spread wings to expand our capabilities and explore new horizons, the fundamental focus remains unchanged: seek out the best technology in the world and put it at the service of our ultimate user: our customer." Sunil Bharti Mittal (Group Chairman and Managing Director) Bharti Enterprises has been at the forefront of technology and has revolutionised telecommunications with its world-class products and services. Established in 1985, Bharti has been a pioneering force in the telecom sector 8

with many firsts and innovations to its credit, ranging from being the first mobile service in Delhi, first private basic telephone service provider in the country, first Indian company to provide comprehensive telecom services outside India in Seychelles and first private sector service provider to launch National Long Distance Services in India. As of October 31, 2004, Bharti had approximately 9.83 million total customers nearly 9.06 million mobile and 776,000 fixed line customers. Its services sector businesses include mobile operations in Andhra Pradesh, Chennai, Delhi, Gujarat, Haryana, Himachal Pradesh, Karnataka, Kerala, Kolkata, Madhya Pradesh circle, Maharashtra circle, Mumbai, Punjab, Rajasthan, Tamil Nadu, Uttar Pradesh (East) circle, Uttar Pradesh (West) circle and Jammu & Kashmir. In addition, it also has a fixed-line operations in the states of Madhya Pradesh and Chattisgarh, Haryana, Delhi, Karnataka and Tamil Nadu and nationwide broadband and long distance networks. Bharti has recently launched national long distance services by offering data transmission services and voice transmission services for calls originating and terminating on most of India's mobile networks. The Company is also implementing a submarine cable project connecting Chennai-Singapore for providing international bandwidth. Bharti Enterprises also manufactures and exports telephone terminals and cordless phones. Apart from being the largest manufacturer of telephone instruments, it is also the first telecom company to export its products to the USA. 1.Group overview 2. Group structure

Introduction Bharti Teletech, the manufacturing arm of Bharti Enterprises, with an installed capacity of 5 million telephone sets per annum, is India's leading manufacturer of high quality telephones. Today Bharti Teletech is the major PTT supplier in South Asia. It has ISO 9002 accreditation and also an OEM for Sprint Corporation and Siemens. It's range of products marketed under the brand name Beetel constitute a 30% market share in India thereby making it the market leader in the domestic market.

Services Accomplishments

Connecting India - Growing Presence

10

1999 Number of Mobile Circles 2 Number of Fixed-Line Circles 1 Population covered in our licensed area 2% (%) Area covered in our licensed areas (%) 2% Wireless Coverage Area (% of Mobile 16% Customers covered)

Pre-4th Licence 5 1 16% 16% 38%

Post-4th Licence 19 6 58% 56% 96%

The largest private sector integrated telecommunications services group in India in terms of the number of customers.

Largest Mobile footprint in India, covering 18 of the 23 licensed areas.

Proven track record of managing growth - both organic as well as by way of acquisitions.

First and largest private telecommunications services company offering fixed-line services in India.

Existing foreign shareholders have acquired direct and indirect equity interests in the Company for a total consideration exceeding US$1 billion. 11

First private telecommunications company to launch long distance services.

First off the block to launch fixed-line services in all the four circles of Delhi, Haryana, Karnataka and Tamil Nadu.

Bharti Tele-Ventures, its subsidiaries and management have received several awards and recognitions, including:

Bharti was recognized as one of the "Leading Lights of Telecom" in Asia in November 2001 in the Asian edition of the "tele.com" magazine with analytical inputs from research consultants Frost & Sullivan.

The leading telecommunications service provider in India in a survey of Indian companies conducted by Business World in association with Indian Marketing Research Bureau in September 2001;

The Techies award from Information Communications World, an international business magazine, for four consecutive years (1997 to 2000) for brand excellence, network quality, customer service and value added service in our Delhi mobile circle;

Golden Peacock National Training Award 1999 to Bharti Cellular for our Delhi mobile operations from the Institute of Directors, a nonprofit association in India committed to improving the competitiveness of Indian business by focusing on development of business leaders, for the best human resources and training practices.

Ascent Times of India and Sodexho Pass award in 1999 from the Asia Pacific HRD conclave to Bharti Cellular for corporate excellence in the category of most innovative human resource practices. 12

Mr. Sunil Bharti Mittal (Chairman and Group Managing Director) was honored as " One of the Top Entrepreneurs Worldwide" for the year 2000 and "Stars of Asia" for the year 2001 by international business magazine, Business Week.

Mr. Sunil Bharti Mittal was selected as the "Businessman of the year 2002" by Business India.

Mr. Sunil Bharti Mittal was awarded the Dataquest IT man of the year 2002.

Mr. Sunil Bharti Mittal was selected the "CEO of the year 2002" by World HRD congress.

Mr. Akhil Gupta (Joint Managing Director) was adjudged as the Chief Financial Officer for year 2001 for Mergers & Acquisitions activities by EIU.

CORPORATE STRUCTURE

13

Management Structure

14

The group has been structured to create functional and operational specialisation with a linear vision of business lines and functional areas. The Company is headed by Chairman and Group Managing Director- Sunil Bharti Mittal who is assisted by two Joint Managing Directors- Akhil Gupta and Rajan Bharti Mittal. The Company also has two Presidents- President Mobile Services and President Infotel Services, this responsibility includes Fixed-line, Long Distance and Broadband Services. The Presidents report to the Group Chairman and Managing Director. The head of units and SBUs report to the respective business's President. An apex team of Corporate Directors has been constituted. The corporate directors have supervisory and strategic responsibilities for functional areas across business lines. The directors oversee functional areas including Business Development, Human Resources, Marketing, Corporate Communication, IT & Technology, Finance, Legal, Corporate Affairs, Corporate Strategy & Planning and Supervisory Director cum Chief Mentor - mobility. The organisation structure is designed to ensure that identical businesses are run 15

along similar lines and best resources in any functional field, be tapped to serve the best interests of the entire group. The structure also defines the role of the Head of the units who are totally empowered to manage their respective companies and are fully responsible for business operations to build world-class organizations with a high degree of customer focus. BOARD OF DIRECTORS MR. SUNIL BHARTI MITTAL MR. RAKESH BHARTI MITTAL MR. RAJAN BHARTI MITTAL

BOARD OF DIRECTORS

MR. AKHIL GUPTA MR. LUNG CHIEN PING MR. LIM TOON MS. CHUA SOCK KOONG MR. DALIP PATHAK MR. BASHIR ABDULLA CURRIMJEE MR. DONALD CAMERON MR. N. KUMAR MR. PULAK PRASAD MR. PAUL O'SULLIVAN PROF. V.S RAJU MR. KURT HELLSTROM

16

Mobile Division Overview Bharti Tele-Ventures vision for its mobile business is To make mobile communications a way of life and be the customers first choice. The mission is to meet the mobile communication needs of the customer through 1) error free service 2) Innovative products and services and 3) cost efficiency. The Companys strategic objective is to consolidate its leadership position amongst the mobile service providers in India. The Indian mobile market, according to the COAI, has increased from approximately 1.2 million subscribers as of March 31, 1999 to approximately 34.77 million subscribers as of October 31, 2004.

17

Despite this rapid growth, the mobile penetration rate in India, at approximately 3.4% as of October 31, 2004, is significantly lower than the average mobile penetration rate in other Asian and international markets. The number of mobile subscribers in India is expected to show rapid growth over the next four years. By 2006 it is projected at 50 million by COAI and 44 million by Gartner. Bharti Tele-Ventures believes that the demand for mobile services in India will continue to grow rapidly as a result of the following factors: Lower tariffs and handset prices over time; Growth in pre-paid customer category; Greater economic growth and continued development of India's economy; Higher quality mobile networks and services; and Greater variety and usage of value added services. Bharti Tele-Ventures, through its subsidiary has the licenses to provide GSM services in all the twenty-three telecom circles in India. It proposes to consolidate all its subsidiaries providing mobile services under Bharti Cellular Limited. As of October 31, 2004, approximately 96% of India's total mobile subscriber market resided in the Company's nineteen mobile circles, which collectively covered only 56% of India's land mass. Mobile Footprint The map below depicts the location of, and provides certain information for, Bharti Tele-Ventures' existing mobile circles in India:

18

Source: (1) Population estimates are as per National Census, 2001 and are as of March 1, 2001. The population for Uttar Pradesh (West) circle is approximately 37% of the total population for the state of Uttar Pradesh. (2) Wireless subscriber statistics are as of Oct 31, 2004 and are based on data released by COAI. Wireless market size comprises the total number of wireless subscribers of all the service providers in a circle.

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(3) Demographics of Maharashtra and Tamil Nadu do not include demographics of state capitals (metros) Mumbai and Chennai respectively. (4) Demographics of Haryana does not include Faridabad & Gurgaon as they are included in Delhi & NCR. Similarly demographics of Uttar Pradesh (West) & Uttaranchal does not include Noida & Ghaziabad as they are included in Delhi NCR. The significant growth in the Company's mobile business has been through a combination of organic growth and acquisitions of additional licenses and has been summarized below. The information given below is for the total market and is not representative of our market share or network coverage. 1) Comprises the circles of Delhi and Himachal Pradesh. 2) Comprises the circles of Delhi, Himachal Pradesh, Karnataka and Andhra Pradesh. 3) Comprises the circles of Delhi, Himachal Pradesh, Karnataka, Andhra Pradesh and Chennai. 4) Comprises the sixteen operational circles of Bharti Tele-Ventures.

5) Based on data released by the COAI on the total number of persons subscribing to mobile services in our licensed areas.

Mobile Strategy

Capture maximum telecommunications revenue potential with minimum geographical coverage to maximise its revenues and margins.

Build high quality mobile networks by deploying state-of-the-art technology to offer superior services. 20

Use the experience it has gained from operating its existing mobile networks to develop and operate other mobile networks in India and to share the expertise across all of its existing and new circles.

Attract and retain high revenue generating customers by providing competitive tariffs, offering high quality customer support, proactive retention programs and roaming packages across all of its mobile circles.

Provide affordable tariff plans to suit each segment of the market with a view to expand the reach, thereby increasing the mobile customer base rapidly.

Introduction Bharti Telesoft, the telecom and e-commerce venture of Bharti Enterprises , India has maintained a very close track on technology and new services to help its customers and partners thrive on change. Bharti Telesoft is an Indian software company with a clear distinction. As part of India's largest telecom group, it is uniquely able to harness rich domain experience to the customer's benefit. Instead of being an IT company providing telecom solutions, we pride ourselves in being just the opposite! Bharti Telesoft is fast on the way to attaining a position of leadership in the IT world, through its clear focus on telecom, backed by rich domain expertise. The company has one of the best development facilities in the country, and has offices in India, United States and United Kingdom. Bharti Healthcare The corporate ethos of providing the best to our customers carries extra relevance when it comes to healthcare products. One sector where quality implies the saving of lives and the promotion of healthy living. Offering quality support to the pharmaceutical industry, Bharti Healthcare has been engaged in the manufacture of empty hard Gelatin capsules since 1982. 21

Bharti's

firm

commitment

to

quality

and

customer

satisfaction

is

duly

acknowledgement by the list of prestigious clients including Pfizer, Parke Davis, Wockhardt, Ranbaxy and Glaxo amongst others. Bharti also exports its capsulesto overseas markets like USA, Hong Kong, Malaysia, Thailand, Indonesia, Sri Lanka, Iran, Bangladesh, Syria and Cyprus.

The US FDA has recently assigned Drug Master File (DMF) number to BHCL as an acknowledgement of it's firm commitment to adhere to globally recognized quality standards in the Pharmaceutical industry. BHCL is also an ISO 9002 certified company.

ABOUT AIRTEL Airtel comes to you from Bharti Cellular Limited - a part of the biggest private integrated telecom conglomerate, Bharti Enterprises. Bharti Enterprises has been at the forefront of technology and has revolutionized telecommunications with its world class products and services. Established in 1976, Bharti has been a pioneering force in the telecom sector with many firsts and innovations to its credit. Bharti has many joint ventures with world leaders like Singtel (Singapore Telecom); Warburg Pincus, USA; Telia, Sweden; Asian infrastructure find, Mauritius; International Finance Corporation, USA and New York Life International, USA. 22

Bharti provides a range of telecom services, which include Cellular, Basic, Internet and recently introduced National Long Distance. Bharti also manufactures and exports telephone terminals and cordless phones. Apart from being the largest manufacturer of telephone instruments in India, it is also the first company to export its products to the USA. Bharti is the leading cellular service provider, with a footprint in 15 states covering all four metros. It has over four million satisfied customers. So come explore the making of the brand, which touches the lives of 600 million people across 16 states of India. From the meaning of our logo to downloadable goodies for your computer, it's all here BRAND&ADVERTISING:For a brand to be successful, it must build enduring relationships with its different audiences. Integral to this relationship is the visual image of the brand the consumer carries in his/her mind. The Airtel brand image is created through the consistent application of a carefully developed visual identity, which helps Airtel distinguish itself in a cluttered market. Airtel's visual identity helps create instant brand recall and strengthens the relationships that its audiences have with it.

The Airtel visual identity has different elements that work together to create a strong and consistent identity for the brand. The most important of these are:

The Airtel logo is a strong, contemporary and confident symbol for a brand that is always ahead of the rest. It is a specially drawn word mark. The Airtel Image style 23

It incorporates two solid, red rectangular forms whose counter form creates an open doorway. The Airtel Typographical style The title case lettering with its capital 'A' was deliberately chosen to reinforce the brand's leadership position. The red dot on the letterform 'I' cues Airtel's focus on innovation.. The words 'Express Yourself' are very much part of the brand identity. The Airtel Colour Palette The lettering is grey so that the pure black of Airtel is visually unharmed. DESKTOP DOWNLOADS:Here's some cool downloads to liven up your desktop. Go ahead... Express Yourself.

HISTORY OF CELL PHONES CELLULAR PHONE A type of wireless communication that is most familiar to mobile phones users. It's called 'cellular' because the system uses many base stations to divide a service area into multiple 'cells'. Cellular calls are transferred from base station to base station as a user travels from cell to cell. The basic concept of cellular phones began in 1947, when researchers looked at crude mobile (car) phones and realized that by using small cells (range of service area) with frequency reuse they could increase the traffic capacity of mobile phones substantially. However at that time, the technology to do so was nonexistent. A cell phone is a type of two-way radio. In 1947, AT&T proposed that the FCC (Federal Communication Commission) allocate a large number of radiospectrum frequencies so that widespread mobile telephone service would become feasible and AT&T would have a incentive to research the new technology. But there 24

was a gap between the initial concept of cellular service and its availability to the public. The FCC decided to limit the amount of frequencies available in 1947, the limits made only twenty-three phone conversations possible simultaneously in the same service area - not a market incentive for research.

INDIVIDUAL INVENTORS & MOBILE PHONE PATENTS Radio Telephone System Inventors: Martin Cooper, Richard W. Dronsuth; Albert J. Mikulski, Charles N. Lynk Jr., James J. Mikulski, John F. Mitchell, Roy A. Richardson, John H. Sangster Dr Martin Cooper, a former general manager for the systems division at Motorola, is considered the inventor of the first modern portable handset. Cooper made the first call on a portable cell phone in April 1973. He made the call to his rival, Joel Engel, Bell Labs head of research. Bell Laboratories introduced the idea of cellular communications in 1947 with the police car technology. However, Motorola was the first to incorporate the technology into portable device that was designed for outside of a automobile use. Cooper and his co-inventors are listed above. By 1977, AT&T and Bell Labs had constructed a prototype cellular system. A year later, public trials of the new system were started in Chicago with over 2000 trial customers. In 1979, in a separate venture, the first commercial cellular telephone system began operation in Tokyo. In 1981, Motorola and American Radio telephone started a second U.S. cellular radiotelephone system test in the Washington/Baltimore area. By 1982, the slow-moving FCC finally authorized commercial cellular service for the USA. A year later, the first American commercial analog cellular service or AMPS (Advanced Mobile Phone Service) was made available in Chicago by Ameritech.

25

Despite the incredible demand, it took cellular phone service 37 years to become commercially available in the United States. Consumer demand quickly outstripped the 1982 system standards. By 1987, cellular telephone subscribers exceeded one million and the airways were crowded.

Three ways of improving services existed:

One - increase frequencies allocation Two - split existing cells Three - improve the technology The FCC did not want to handout any more bandwidth, and building/splitting

cells would have been expensive and would have added bulk to the network. To stimulate the growth of new technology, the FCC declared in 1987 that cellular licensees could employ alternative cellular technologies in the 800 MHz band. The cellular industry began to research new transmission technology as an alternative. WIRELESS PCS TECHNOLOGY PCS (Personal Communication Services): Used to describe a newer class of wireless communications services recently authorized by the FCC. PCS systems use a different radio frequency, the 1.9 GHz band, than cellular phones and generally use all-digital technology for transmission and reception. After the Federal Communications Commission (FCC) declared in 1987 that cellular licensees could employ alternative cellular technologies in the 800 MHz band, the cellular industry began to research new transmission technology as an alternative to AMPS (Advanced Mobile Phone Service) that had been the industry standard since 1978. In 1988, the (CTIA) was established to work with the cellular service operators and researchers to identify new technology requirements and set goals. They 26

wanted the new products and services introduced by 1991, a 1000% percent increase in system capacity with both AMPS (analog) and digital capability during transmission, and new data features such as fax and messaging services.

The (TIA) created a standard specification based on the requirements the CTIA had recommended. The TDMA Interim Standard 54 or TDMA IS-54 was released in early 1991. The technology was tested that same year in Dallas and Sweden. In 1994, the FCC announced it was allocating spectrum specifically for PCS technologies at the 1900 MHz band. Three major standards have been released since 1991. All of these new digital wireless standards are currently being used in PCS. WIRELESS STANDARDS Analog Service: A method of modulating radio signals so that they can carry information such as voice or data. Analog cellular phones work like a FM radio. The receiver and transmitter are tuned to the same frequency, and the voice transmitted is varied within a small band to create a pattern that the receiver reconstructs, amplifies and sends to a speaker. The drawback of analog is the limitation on the number of channels that can be used. Digital Service: A method of encoding information using a binary code of 0s and 1s. Most newer wireless phones and networks use digital technology. In digital, the analog voice signal is converted into binary code and transmitted as a series of on and off transmissions. One of Digitals drawbacks is that there are three digital wireless technologies, CDMA, TDMA and GSM. Phones that work with one technology may not work on another. Time Division Multiple Access (TDMA) is an update to TDMA IS-54, also called Digital AMPS or D-AMPS. Released in 1994, TDMA IS-136 uses the frequency bands available to the wireless network and divides them into time slots with each phone user having access to one time slot at regular intervals. TDMA IS136 exists in North America at both the 800 MHz and 1900 MHz bands. 27

Major US carriers using TDMA are AT&T Wireless Services, Bell South and Southwestern Bell. CDMA IS-95 (Code Division Multiple Access) is based on a form of spread spectrum technology that separates voice signals by assigning them digital codes within the same broad spectrum. CDMA type technology dates back to the 1940s, when spread spectrum technology was used in military communications systems because it was resistant to interference from enemy signals. The corporation began developing a CDMA wireless system in the late 1980s that was accepted as a standard in 1993 and went into operation by 1996. CDMA also exists at both the 800 MHz and 1900 MHz bands. The major US carriers using CDMA are Air Touch, Bell Atlantic/Nynex, GTE, Primeco and Sprint PCS. GSM (Global System for Mobile Communications) is based on a improved version of TDMA technology. In 1982, the Conference of European Posts and Telecommunications (CEPT) began the process of creating a digital cellular standard that would allow users to roam from country to country in Europe. By 1987, the GSM standard was created based on a hybrid of FDMA (analog) and TDMA (digital) technologies. GSM engineers decided to use wider 200 kHz channels instead of the 30 kHz channels that TDMA used, and instead of having only 3 slots like TDMA, GSM channels had 8 slots. This allowed for fast bit rates and more natural-sounding voicecompression algorithms. GSM is currently the only one of the three technologies that provide data services such as email, fax, internet browsing, and intranet/LAN wireless access, and it's also the only service that permits users to place a call from either North America or Europe. The GSM standard was accepted in the United States in 1995. GSM-1900 cellular systems have been operating in the US since 1996, with the first network being in the Washington, D.C. area.

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CELLULAR BACKGROUND 1921 Detroit Michigan Police Dept. made the earliest significant use of Mobile radio in a vehicle in the United States. The system operated at a frequency close to 2 MHz. The channels soon became overcrowded. 1940 New frequencies between 30 and 40 MHz were made available. Increasing the available channels encouraged a substantial buildup of police systems. Shortly thereafter other users found a need for this form of communication. Private individuals, companies, and public agencies purchased and operated their own mobile units. 1945 First public mobile telephone system in the U.S. was inaugurated in St. Louis, Missouri with three channels at 150 MHz. Six channels spaced 60 kHz apart were allocated for this service by the FCC, but the mobile equipment was not sophisticated enough to prevent interference. 1947 A Public mobile system using frequencies in the 35 to 44 MHz band began Operations along the highway between New York and Boston. These frequencies Were thought to carry greater distances however a problem with skip-distance Propagation carried interfering conversations for long distances. These early Mobile telephone systems used push-to-talk operation. 1949 FCC authorized separate radio channels to common carrier entities known as "Radio Common Carriers" (ROC). These companies do not provide public telephone service, but interconnect to the public telephone network to provide mobile telephone services equivalent to the wire line common carriers.

1955

29

Number of wire line channels available at 150 MHz was expanded from 5 to 11 by the creation of new channels between the old ones (channel spacing of 30 kHz). 1956 12 wire line channels were added near 450 MHz. All systems operated in a manual mode, with each call to or from a mobile unit being handled by a special mobile telephone operator. 1964 A new system (150 MHz) was developed providing automatic channel selection for each call, eliminated the need to push-to-talk operation, and allowed customers to do their own dialing. 1969 Automatic capability was extended to the 450 MHz band and the so-called "Improved Mobile Telephone System" (IMTS) became the standard for mobile telephone service in the U.S.

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Cellular Telephony The technology that gives a person the power to communicate anytime, anywhere - has spawned an entire industry in mobile telecommunication. Mobile telephones have become an integral part of the growth, success and efficiency of any business / economy. The most prevalent wireless standard in the world today, is GSM. The GSM Association (Global System for Mobile Communications) was instituted in 1987 to promote and expedite the adoption, development and deployment and evolution of the GSM standard for digital wireless communications. The GSM Association was formed as a result of a European Community agreement on the need to adopt common standards suitable for cross border European mobile communications. Starting off primarily as a European standard, the Group Special Mobile as it was then called, soon came to represent the Global System for Mobile Communications as it achieved the status of a world-wide standard. GSM is today, the world's leading digital standard accounting for 68.5% of the global digital wireless market. The Indian Government when considering the introduction of cellular services into the country, made a landmark decision to introduce the GSM standard, leapfrogging obsolescent technologies / standards. Although cellular licenses were made technology neutral in September 1999, all the private operators are presently offering only GSM based mobile services. The new licensees for the 4th cellular licenses that were awarded in July 2001 too, have opted for GSM technology to offer their mobile services.

Cellular Industry in India

31

The Government of India recognizes that the provision of a world-class telecommunications infrastructure and information is the key to rapid economic and social development of the country. It is critical not only for the development of the Information Technology industry, but also has widespread ramifications on the entire economy of the country. It is also anticipated that going forward, a major part of the GDP of the country would be contributed by this sector. Accordingly, it is of vital importance to the country that there be a comprehensive and forward looking telecommunications policy which creates an enabling framework for development of this industry. New Telecom Policy 1999 Telecommunications is now universally recognized as one of the prime movers of the modern economy; hence it's vital importance for a developing country like India. The availability of adequate infrastructure facilities is critical for acceleration of the economic development of any country. In fact international studies have established that for every 1% increase in tele-density, there is a 3% increase in the growth of GDP. Accordingly, the Government of India has accorded the highest priority to investment and development of the telecommunications sector. Telecom requires very heavy investment and it was not possible for the Indian Government to organize public funding of this sector on such a massive scale. In fact the national telecom Policy 1994, estimated a resource gap of Rs. 23,000 crores to meet the telecom targets of the eighth five-year plan of the Government of India (1992-97). It was for this reason to bridge the resource gap between government funding and the total projected funds requirement and to provide the additional resources to achieve the nation's telecom targets that the telecommunications sector was liberalized in 1992 and the Government invited private sector participation in telecommunications.

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Cellular mobile services were one of the first areas to be opened up to private competition. The whole country was divided into the 4 metropolitan cities of and 19 telecom circles, which were roughly analogous with the States of India. Cellular Licenses were awarded to the private sector - first in the metropolitan cities of Delhi, Mumbai, Kolkata and Chennai in 1994 and then in the 19-telecom circles in 1995. The first metro cellular network started operating in August 1995 in Calcutta. When cellular mobile services were first introduced in 1994 it was as a duopoly (that is a maximum of two cellular mobile operators could be licensed in each telecom circle), under a fixed license fee regime and for a license period of 10 years. The initial response of the private sector was very encouraging. The attractiveness of the Indian market - the low tele density, the high latent demand and a burgeoning middle class - brought in some of the largest global telecom players, foreign institutional investors and the major Indian industrial houses to invest in telecom, especially the Indian cellular industry.

Telecom proved to be a powerful attractor of foreign investment. The cumulative FDI inflow into telecom since 1993 has exceeded Rs. 43,000 Million. Within telecom, the cellular industry has attracted most of the foreign investment since 1993, accounting for almost 50% of the FDI inflow into telecom - representing amongst the biggest investments in any one sector in India. Annual foreign investment in telecom increased steadily from an insignificant Rs. 20.6 Million in 1993 to Rs. 17,756.4 Million in 1998. However, the attractiveness of the Indian market did not last for very long, as by 1997-98, the private cellular operators were confronted with a series of problems that threatened their very viability and survival. As a result of this, FDI inflow into telecom dropped sharply, declining by almost 90% to Rs. 2126.7 Million in 1999. This dropped further in Year 2000 - as until June 2000, only Rs. 918 Million had flown into the country. 33

One of the key factors responsible for the critical state of the telecom sector & consequently also the cellular industry was that liberalization / deregulation was undertaken in an inverted manner vis--vis international practices and generally accepted norms. Usually, deregulation is preceded by tariff rebalancing, institution of a strong and independent regulator and only then is private sector participation invited. In India, private sector participation was invited in 1992, the Regulatory Authority was set up in 1997 and the tariff rebalancing exercise commenced in 1999 and is still far from complete. Further, even when the regulatory authority was set up, there was considerable ambiguity on its powers, which resulted in virtually each and every order of the Authority being challenged by the Licensor / incumbent. The ambiguities in the jurisdiction of TRAI resulted in a limbo in the industry. Another important factor was the basic approach of the Government towards liberalization. Consumer benefit was given the go-by and the telecom sector was viewed as a revenue generator / cash cow for the Government exchequer. NTP 94 was basically a good policy. It clearly identified that the primary objective of the policy was to make available affordable telecom services. However, in actual policy implementation, this key / fundamental objective was disregarded. Licenses were granted through an auction process and the enthusiastic private sector deluded by the seemingly huge potential of the Indian market were lured into bidding exorbitant sums of money for cellular licenses. The huge license fees paid by the private operators resulted in a high cost structure leading to un-affordable tariffs and lower growth of the market. By end1998, the cellular industry was on the verge of bankruptcy and at that time it appeared that the liberalization dream was over & the nightmare had begun It was under the above circumstances that the Government undertook a review of telecom policy & the role of the regulatory authority. The result was NTP 99, which was announced in March 1999 & the amendment of the TRAI Act in January 2000.

34

NTP 99 is an extremely forward-looking policy. It significantly changed the dynamics of the Indian telecom industry as it not only replaced the high cost fixed licensing regime with a lower cost licensing structure through revenue sharing, but also provides for greater degree of competition and more flexibility in choice of technologies. The amendments in the TRAI Act resulted in a considerable strengthening of the Regulator & greater clarity on its role and powers. It also put in place a separate dispute settlement mechanism in the form of the Telecom Dispute Settlement and Appellate Tribunal to expeditiously deal with and resolve issues relating to the telecom sector. Existing private cellular operators migrated to the new telecom policy regime with effect from August 1999. There can be no doubt that migration to a more beneficial regime translated into tangible consumer benefits - lower tariffs, greater subscriber uptake & increased coverage. Cellular tariffs have dropped by over 90% since May 1999 - a feat unparalleled by any other sector or industry in India. The average airtime tariff in Year 2001 was prevailing around Rs. 2 per minute as against the peak ceiling tariff of Rs. 16.80 per minute when NTP 99 was announced. Parallely, there has also been a significant drop in the cost of mobile handsets. Cellular handsets that were available for around Rs. 25-30,000 in the initial days of cellular have now dropped significantly, with a base level handsets being available for as little as Rs. 2,000 upwards. This has come about as a result of increased volumes and some degree of rationalization of government levies. As a result of improved affordability, there an increased take-up of the service and the cellular operators were able to venture into more and more cities & towns of the country. In fact cellular services are now available in almost 1400 cities & towns of India. With the lower tariffs and increased coverage, there was also a resultant increase in the number of cellular subscribers. The point of inflexion for subscriber 35

take-off is clearly post NTP-99. From 1.2 million subscriber in April 1999, to almost 2 million by April 2000, the number of cellular subscriber have now grown to almost 6.5 million by the end of March 2002. By March 2001, the industry had invested nearly Rs. 16,000 crores in cellular infrastructure and it is estimated that these investments will grow to Rs. 20,000 crores in the next 4-5 years. The year 2001 also saw the entry of BSNL and MTNL as the third cellular operators as had been mandated in NTP 99. Further, in July 2001, cellular licenses were awarded to the 4th cellular operators in different telecom circles. With this the number of cellular operators has gone up to 89 licenses. As of March 2002, the Indian cellular mobile industry had 42 networks on air, serving over 1400 towns and cities and covering thousands of villages and serving almost 6.5 million subscribers across the country.

The quality of the service is widely accepted to be of international standards and till date there has been no waiting period involved in availing of this service. The cellular industry has been growing at an average rate of 85% per annum and it is hoped that the industry will be able to sustain this growth in the coming years. The Working Group on the Telecom Sector set up by the Government of India for the tenth five-year plan, has estimated that over the next five years, around 31.55 million cellular subscribers would be added all over India. To achieve this growth, the Working Group has also estimated that resources to the tune of about Rs. 25,240 crores will be required over the next five years. However, to attract foreign investments into India, it is imperative to ensure the predictability and stability of the policy and regulatory regime of the Country. 36

Policy flip-flops & regulatory ambiguity have plagued the Indian telecom sector since the introduction of privatization. This has had the unhappy result of putting the entire sector into a state of limbo as investors - both foreign & domestic await clarity on the final direction that the policy will take. In the meantime, foreign investors, who have not committed themselves to the Indian market, will divert their interest & investments to competing and more attractive FDI destinations. Further, for the industry to attract the requisite investments and to reach the growth targets set for the tenth five-year plan, it is imperative that a few crucial industry issues that have been plaguing the industry, be resolved on an urgent footing. This includes most importantly:

The early resolution of the dispute relating to the recent permission Granted to fixed operators to offer WLL based mobile services without a mobile license and under the more advantageous terms of their fixed service license and

The institution of a formal interconnection agreement between the cellular operators and the fixed service providers especially the incumbent fixed service operators - BSNL and MTNL.

CONTRIBUTIONS OF THE CELLULAR INDUSTRY TO THE INDIAN ECONOMY 1. World Class Infrastructure The Indian cellular industry has been instrumental in bringing to the Indian consumer, a world-class telecom infrastructure. The Indian Cellular Industry is: The flag-bearer of the Indian liberalization process. 37

 The largest recipient of Foreign Direct Investment (around Rs. 2200 Crores)-A responsible performing sector that has met all its obligations to the GOI. The Industry would have invested over Rs. 25,000 crores to: Set up 69 Networks Serve over one crore subscribers as of December 2002 Offer Services in over 1575 cities & towns and Cover over 14,000 villages

2. Reputed Indian Business Houses & International Telecom Majors

The privatization of Indian cellular brought into the arena some of the most reputed business houses of the country as also biggest names in the international telecommunications industry. These included: Reputed Indian Business Houses - Birla, BPL, Escorts, Essar, Reliance, RPG, Tata, and Thapar. International Telecom Majors - Singtel, Asia Tech, AT&T, Bell South, Nynex, Millicom, First Pacific, Hutchison Whampoa, Telecom Italia, New York Life, Telecom Investments, Telesystem International Wireless, CellaNet and others. Institutional Investors - AIG, Commonwealth Development Corporation (CDC), EMP, Asian Infrastructure Fund and others. 3. Increased Connectivity 38

There are presently 42 networks operating in the country covering over 1350 cities and towns and directly servicing over 6.7 million subscribers nation-wide. Importantly, the connectivity benefits also extend to over 33.5 Mn PSTN subscribers of BSNL & MTNL who can now reach the cellular subscribers " anytime and anywhere". In addition the cellular radio waves cover over 28,000 villages, where connectivity can be provided at a very short notice at a nominal incremental cost.

4. Employment Generation As the 3rd and 4th Cellular Licensees would start their operations and with 77 networks (42 presently and 35 new networks) on air, the employment generated by the industry would be promising. In addition to the direct employment generated by these networks, there is also the multiplier effect of indirect employment generated down the supply chain comprising vendors, infrastructure suppliers, contractors, dealers, etc. It is estimated that the total employment generated by the cellular industry would be in the tune of a few lakhs once the new networks are rolled in. 5. Increased FDI Flows The Telecom sector is the largest attractor of Foreign Direct Investment in the country, accounting for almost a fifth of FDI approvals since 1991. 6. Heavy Investment in Infrastructure The cellular industry is responsible for the single largest chunk of investment by any individual industry. The industry has already invested over Rs. 20,000 crores and is expected to invest even more in the years to come. 7. Revenue Generation for the Government of India

39

The cumulative revenues that have flowed to the Government are already about Rs. 10,000 crores from license fee and service-tax alone.

40

VARIOUS SERVICE PROVIDERS IN INDIA

Aircel Limited Aircel Limited is the Cellular Operator in Tamil Nadu Cellular Circle (Tamil Nadu except Chennai and including Pondicherry). Promoters: Aircel Limited is a part of the Sterling InfoTech Group founded by Mr. C. Sivasankaran. The Sterling Group has been in operation for over 2 decades and is promoting the cause of stable business opportunities catering to a need-based society thus contributing significantly to the quality of life for people across the country. Tracing its roots back to the early 80s, the Sterling Group revolutionized the then infantile PC Market with the launch of a series of Siva PCs. The Sterling Group Companies include Dishnet DSL Limited, one of the leading Internet Service Provider in the country and the only ISP provider offering Digital subscriber line in the country. Sterling Agro Products Processing Pvt. Limited, a leading exports of gherkins and Fresh & Honest Cafe Limited, engaged in export of coffee beans and distribution of coffee vending machines. Technology partners: The Technology partners of Aircel are Ericsson who provide the Mobile Switching Centers and Base Stations & Fujitsu who provide the MW Backbone. Aircel has a network of more than 100 exclusive agents across Tamil Nadu. Launch of services: 41

Aircel launched its operations in April 1999. Aircel Digilink India Limited Aircel Digilink India Limited, provides cellular services in the circles of Haryana, Rajasthan and UP (East) under the brand name "Essar". Promoters: The Essar Group is one of India's leading business conglomerates, with an asset base of over US$ 4 billion (Rs. 170 billion). The Group is committed to the development of core sector and infrastructure businesses in India and abroad. Essar Group is actively involved in five principal businesses viz., Steel, Shipping, Oil & Gas, Power and Telecommunications. Each of Essar's businesses has been carefully synergies with the others to form one single integrated whole. Technology Partners: The company uses world-renowned technology from Siemens in building and operating its North Indian Network. ADIL offers a basket of GSM Phase I and Phase II features. It offers voice, fax, data and other facilities. Launch of Services: Aircel Digilink India Limited (ADIL), was incorporated in March 1995 and was subsequently inducted into the Essar group in 1996. UP (East): ADIL launched its UP (East) services in May 1997. Haryana: ADIL's services in Haryana commenced in June 1997.

Rajasthan: ADIL's services in Rajasthan were started in December 1996. Pre-paid Services: The Company launched its pre-paid services under the brand name "Tring" Bharti Cellular Limited 42

Bharti Cellular Limited is the cellular licensee for the Delhi (Metro), Mumbai (Metro), UP(W), Haryana, Maharashtra, Tamil Nadu, Kerala, MP The company offers services under the brand name "AirTel". Technology Partners: AirTel has been immeasurably strengthened by its partnership with British Telecom U.K. and Telecom Italia of Italy. AirTel services are in technical alliance with Ericsson, has provided AirTel subscribers with a truly world class network. Bharti Mobile Limited Bharti Mobile Limited offers services in Andhra Pradesh, Karnataka and Punjab under the brand name "Airtel" Promoters: Bharti Mobile Limited, a joint venture of Bharti Enterprises and Telia. Technology Partners: Airtel comes to you from Bharti Mobile Ltd. A consortium of giants in the telecommunication business - British Telecom UK, Tecc3300 Italy, and Bharti Enterprises India.

The Bharti Enterprises, established in 1976, is today a multifaceted organisation and a leading group involved in the manufacturing and the services sector. Its key focus is on the marketing and operations of a comprehensive range of telecom services in addition to the Healthcare sector. Launch of Services: 43

Karnataka: Airtel launched it's services in Karnataka on May 13,2000. The services in Punjab started in February 2002. Airtel is brought by Bharti Enterprises, India's leading telecom conglomerate, through its company, Bharti Mobile Limited. Bharti Enterprises has revolutionized Indian telecommunications with its world-class products and services. Pre-paid Card: The pre-paid card "Magic" is a nation wide brand. Bharti Mobinet Limited Service Area: Chennai (Metro) Brand Name: Air Tel Bharti Mobitel Limited Service Area: Kolkata (Metro) Brand Name: Air Tel Bharti Mobitel is the cellular licensee for the Kolkata Metro.

Bharti Enterprises has been at the forefront of technology and has revolutionized telecommunications with its world-class products and services. Established in 1976, Bharti has been a pioneering force in the telecom sector with many firsts and innovations to its credit. Bharti has many joint ventures with world leaders like Singtel (Singapore Telecom); Warburg Pincus, USA; Telia, Sweden; Asian infrastructure find, Mauritius; International Finance

Corporation, USA and New York Life International, USA. Bharti provides a range of telecom services, which include Cellular, Basic, Internet and recently introduced National Long Distance. Bharti also manufactures 44

and exports telephone terminals and cordless phones. Apart from being the largest manufacturer of telephone instruments in India, it is also the first company to export its products to the USA. Pre-paid Services: The Company operates its pre-paid service under the brand name "Magic". Bharti Telenet Limited Service Area : Himachal Pradesh Brand Name: Air Tel BPL Cellular Limited BPL Cellular Limited (BCL) is the licensee to provide cellular mobile services in the States of Maharashtra (excluding Mumbai but including Goa), Tamil Nadu (excluding Chennai but including Pondicherry) and Kerala. The company offers services under the brand name BPL Mobile.

Promoters: BPL Cellular Ltd. is a joint venture between, BPL, India's No.1 Consumer durable giant and AT&T Broadband. Technology Partners: A reliable and world-class quality network supported by world's leading technology vendors like NOKIA, MOTOROLA and LHS. Reliability ensured through 3700 km. Of Digital Microwave backbone across the 5 states using the latest SDH technology and sound clarity with EFR technology. The company has in-house technical expertise in RF planning and initially used the tool Planet, licensed from Mobile Systems International (MSI), to plan the KR engineering and network design for each of the circles. Launch of Services:

45

The company commenced services in January 1997 in Pune, Maharashtra. Since its first year of operations, the company has been offering a wide range of products and services. Prepaid Services: The company's prepaid service is marketed under the brand name "BPL Mobile On The Spot" (commonly referred to as 'MOTS'). BPL Mobile Communications BPL Mobile is the cellular service provider for the metropolitan city of Mumbai, New Mumbai & Kalyan Telecom Circles and offers services under the brand of BPL Mobile.

Promoters: BPL Mobile is a joint venture between the BPL Group and France Telecom. The BPL Group is widely regarded as a successful, dynamic business house with more than two decades of successful consumer marketing expertise. It occupies the top slot in terms of market share in all its areas of operation. The Group has five focus areas: telecom, consumer electronics, home appliances, components and power. In telecom, the BPL Telecom Business Group (TBG) has over three decades of expertise in manufacturing, designing and marketing telecom and IT products and solutions. Infrastructure Vendors: Siemens, Motorola and Nokia Foreign Partners: France Telecom Launch of Services: The Company commercially launched its services on October 2, 1995. 46

Pre-paid Services: BPL Mobile's prepaid services are marketed under the brand name "MOTS" - Mobile on the Spot.

IDEA Cellular Limited IDEA Cellular Limited, formally known as Birla Tata AT&T Communication Limited is the cellular operator in the circles Maharashtra, Gujarat, Andhra Pradesh, Madhya Pradesh and Delhi (Metro) under the brand name "IDEA". Technology Partners: Technologically Birla AT&T Communication Limited has adopted the superior CME-20 system architecture from Ericsson one of the largest manufacturers of GSM equipment in the world. Launch of Services: The cellular service was launched in the Gujarat circle in January 1997 and in the Maharashtra Circle (excluding Mumbai, including Goa) in March 1997. Established in 1947, the Aditya Birla Group is on of the leading business houses in India. The Group has its presence across various sectors including cement, viscose staple fiber, engineering, textiles, power, telecommunication, industrial chemicals, petroleum and financial services. 47

AT&T is the largest telecommunication company in the world offering a complete range of communication services. AT&T started its operations in 1885 and is present in over 200 countries. In the United States its parent country, AT&T Corp. is a leading long distance carrier, wireless operator and provider of video data and Internet services. Pre-paid card: The Idea Cellular Pre-paid Card is called as "Idea Chitchat".

Reliance Telecom Limited Reliance Telecom limited is the Cellular Services Operator in seven circles - Bihar, Orissa, Madhya Pradesh, Himachal Pradesh, West Bengal, Assam and North-East. The license area includes 13 states covering more than 35 % of India's landmass and 33 % of India's population. The company offers its services under the brand name of Reliance Mobile. Promoters: Reliance Telecom limited has been promoted by India's largest private sector company, Reliance Industries limited with minority equity participation by Bell Atlantic - Nynex Inc. Reliance Telecom's major coverage lies in the eastern region of the country, where there is an opportunity to supplement the existing fixed line network which has remained underdeveloped due to historical reasons. Reliance Telecom has been successful in a short span of time in setting up network and providing cellular services across seven Circles. 48

Technology Partners: The MSCs for Reliance Mobile have been supplied by Ericsson, BSC/ BTS by Motorola and the Billing System by Siemens Nixdorf. Reliance Telecom Limited offers services such as post-paid service, prepaid card, voice mail, roaming and inter city cellular service. With networks covering six contiguous circles in Central and Eastern India. RPG Cellular Services Limited RPG Cellular is the cellular licensee for the Chennai Metro and operates under the brand name "RPG Cellular".

Promoters: The RPG Group has promoted RPG Cellular Services Ltd (RCSL) in association with two of the largest GSM cellular operators in the world - AirTouch Communications Inc., U.S.A. and Vodafone Group Plc., U.K. AirTouch is one of the world's largest wireless communication companies with global interests in cellular, paging and personal communications services. The Company is the largest cellular service operator in the world with over 17 million subscribers. Vodafone is a leading global provider of mobile telecommunications services in U.K. and Australia and several other countries across Europe and Asia and has over 10 million customers worldwide. The Company also has participation in the Global star Satellite Communication System. Infrastructure vendors: Ericsson is the infrastructure vendor of the company. Launch of Services: The Company commenced commercial operations in October 20, 1995. 49

Pre-paid Services: Its prepaid service - "Wings Prepaid" was launched in October 1998.Spice Communications Limited Spice Communications Limited is presently operating Cellular Phone Services in the states of Punjab and Karnataka. Promoters Spice Communications is a 51:49 joint venture between Spicecorp (India)- the flagship company of Dr. B.K. Modi group that first introduced India to mobile phone services and has interests in the field of telecommunications, office automation and information technology and DISTACOM (Hong Kong)-a company with over 20 years of experience in mobile communication which was responsible for bringing mobile telephony to Hong Kong along with Hutchison Telecom. Foreign Partners The Foreign partners for Spice Communications Karnataka are Distyacom, AIG and Prudential. Infrastructure Vendors The infrastructure vendors are Siemens and Motorola. Launch of Service Launched over four years ago under the memorable brand name of "Spice", the Company offers cellular services in Punjab and Karnataka. Spice Karnataka launched its services in April 1997. Pre-paid Service The pre-paid service in Karnataka operates under the brand name "Simple"

50

Chapter III

51

SALES PROMOTIONAL ACTIVITIES Promotion is true that products are manufactured to satisfy the needs of the consumers.. But alone is not enough. Today the responsibility of the manufacturers does not cease with physical production whatever may be the nature of the product. The present day marketers are consumer oriented where it is the duty of the manufacturers to know from where, when, how and what price the products would be available. Successful marketing consists in offering the right product of the right price of the right place (and time) with right promotion. In course of time, various activities came into vogue designed particularly to help easy sale of goods. These activities commonly known as promotional Mix. The marketing communication Mix also called as the Promotion Mix consists of four major tools. 5. Advertising. 6. Sales Promotion 7. Publicity 8. Personal Selling MARKETING COMMUNICATION PROCESS: Generally marketing communication is undertaken to pass on the message of a product or sale to the ultimate consumers. Thus, there are three elements in this process. IMPORTANCE OF ADVERTISING: The purpose of advertising is motivating but to sell something a product, a service or an AIRTEL. The real objective of advertising is effective communication between producers and consumers. In other words the ultimate purpose all advertising is Increased awareness list of the following specific objectives of advertising. To make on immediate AIRTEL To build primary demand To introduce a price deal To inform about a products availability 52

To increase market share To help salesman by building on awareness of a product among retailers To increase the frequency use of a product. To build overall company image To build brand recognition PERSONAL SELLING The process of selling is ensured by personal selling supposed by advertising and sales promotion. Of these three methods personal selling occupies the predominant role mainly because of the personal element involves. It may be described as a personal source rendered to the community in connection with marketing of goods. It is a marketing process with which consumers are personally persuaded to by goods and services offered by a manufacturer. The most powerful element in the promotional mix is salesman ship, is not something very new. Even centuraries ago salesman ship was practiced in Greece and Rome. According to Peter Drucker Cyrus Mecornie was the first man to use modern technique of selling. Features: 1. 2. 3. 4. It helps to establish a cordial and obiding relationship between the organization and its customers. It is a creative art. It creats wants a new. It is a science, in the sense that One human mind influences another human mind. Personal selling imparts knowledge and technical assistance to the consumers.

SALES PROMOTION Promotion includes all those functions, which have to do with the marketing of a product all other activities designed to increase and expand the market. But it is clearly distinguished from advertising and personal selling, through basic aim or all the three is one and the same viz., to increase the volume of sales. Sales Promotion : Contests, Games 53

Sweep stakes, Lotteries Premiums Sampling Fairs and Trade shows Exhibs Demonstrators Couponing Rebates Low interest Financing Entertainment Trade in allowances Trade stamps

Sales promotion in a specific sense, refers to those sales activities that supplement both personal selling and advertising and co-ordinationate them and help to make them effective, such as displays, shows and expositions, demonstrations and other non recurrent selling efforts not in the ordinary routine. In a general sense the sales promotion includes personal selling, advertising and supplementary selling activities. Evaluation of Sales Promotion: Two decades ago, there was no agreement among the marketing people that there was a separate sales promotion function. In those days, promotion was a sharerun to gain a short run good. The importance of sales promotion is modern marketing has increased mainly an account of its ability in promoting sales and preparing the ground for future expansion. The main objective of sales promotion is to attract the prospective buyer towards the product. PUBLICITY The publicity is derived as Any form of commercially significant news about a product, and institution, a service, or a person published I a space or radio i.e. not 54

paid for by the sponsor. In short advertisement is paid form of publicity. It is to be noted here that though the terms ADVERTISING AND Publicity or differences in the field of marketing, both are used interchangeably. The media are broadly classified into direct indirect. Direct method of advertising refers to such methods used by the advertiser with which he could established a direct contact with the prospects. Most of the media are indirect in nature EX: Free Publicity, cinema, etc. Press Publicity : This remains the most popular method of publicity to day. News papers and magazines have become a part of cultural and political life of the people. Now press publicity takes two forms. (a) (b) (a) News Papers Magazines New papers :

The abbreviation for news papers is North. East, West, South past and present event report. News papers are bought largely for their news value. As such they are appropriate for announcing new products and new development of existing products. Because of their frequency of publication, they are also well suited to opportunity makers, the various advantages may be summed up as follows : They reach nook and corner, so their coverage is high.

High frequency enables speedy preparation and publcation of advertisement.

News papers offer a lot of flexibility. According to the convenience and necessity of the advertises the shape and size of advertisement could be changed.

Advertising in news papers is a cheap method of advertising from the company point of view. 55

The news papers advertising sponsor four kinds of advertising Classified advertisement EX : House for sale etc., General advertisement Teaser advertisement News type advertisement

(b) Magazines : Another media under press publicity is magazines, and journals. They also offer good facility because magazines are read leisurely when the reader mentally prepared to receive the advertisement. Magazines are periodicals (periodicals of publication is regular) but different from news papers in two respects. One is that it pre-selects, its readership through the nature its content: as mentioned above they are read leisurely magazines, as a group may be subdivided from the point of view of advertisers as follows: Kinds of out-door publicity: Rural Advertising: It refers to posters which are often posted on walls. The size of such poster would be big and might contain pictures etc. It is often found in cinema advertising. Advertisement boards : These advertisement or posters but are kept at certain fixed places especially at points. Where people frequently assemble bus stages, railway stations etc., and Big hoardings will be placed at various road sides with various offers using stars such as Sachin Ramesh Tendulkar and Sharuk Khan who are the Brand Ambassadors for Airtel with various adds.

Vehicular Advertising :

56

This refers to moving advertisements. These advertisements on moving vehicle such as buses and railway trains offer examples of this. This type of advertising has such a very large circulation and is considered to be very effective.

57

Chapter IV

58

ANALYSIS THE TYPES OF CONSUMERS OF PURCHASE OF AIRTEL

FACTORS EMPLOYEES BUSINESS PERSONNEL PROFESSION STUDENTS TOTAL

NO.OF RESPONDENTS 15 26 3 6 50

PERCENTAGE 30% 52% 6% 12% 100%

According to my survey, it can be seen from the above table that indicates Employees 15 (30%), Business Personnel 26 (52%), Profession 3 (6%) and Students 6 (12%), are preferring to purchase AIRTEL.

BAR GRAPH REPRESENTING THE TYPES OF CONSUMERS OF PURCHASE OF AIRTEL

59

30 25 FACTORS

26

NO.OF RESPONDENTS 11 10 14 15
52%

PERCENTAGE 22% 20% 28%

6

FRIENDS 20

15

ADVERTISEMENTS
15 GOODWILL/FAME

PERSONAL CHOICE 10 TOTAL

5 0 Employees Business

30% 100% 12%

30%

50

3 6%

Profession

Students

NO.OF RESPONDENTS

PERCENTAGE

Influencing factors to purchase of AIRTEL

As per my survey, the above table reflects that Friends 11 (22%), Advertisements 10 (20%), Goodwill/Fame 14 (28%), Personal Choice 15 (30%) are the factors influencing to purchase of AIRTEL.

Blue Pie Graph representing influencing factors to purchase of AIRTEL

60

NO.OF RESPONDENTS
11 15

10

14 FRIENDS ADVERTISEMENTS GOODWILL/FAME PERSONAL CHOICE

61

The following table indicates the level of satisfaction of consumers towards the purchase of AIRTEL.

ATTRIBUTES VERY GOOD GOOD AVERAGE SATISFACTORY TOTAL

NO.OF RESPONDENTS 5 20 19 6 50

PERCENTAGE 10% 40% 38% 12% 100%

PIE EXPLOSION GRAPH REPRESENTING THE LEVEL OF SATISFACTION OF CONSUMERS IN VIEW OF PRICE

25 20 15 10 5 0 5 10%
VERY GOOD

20

19

6 40%
GOOD

38%
AVERAGE

12%
SATISFACTORY

NO.OF RESPONDENTS

PERCENTAGE

62

The following table indicates the level of satisfaction of consumers towards the purchase of AIRTEL.

Attributes Very Good Good Average Not Satisfied Total

No. of Respondents 10 21 16 3 50

Percentage 20% 42% 32% 6% 100%

THE FLOATING GRAPH REPRESENTING SERVICES OF AIRTEL TO THE CONSUMERS

25

21
20

16
15 10 5

10

20%
0 Very Good

42%
Good

32%
Average

6%

Not Satisfied

No. of Respondents

Percentage

63

Type of Promotional Activity towards To Purchasing Airtel

FACTORS Advertisement Publicity Sales Promotion Word of Mouth TOTAL

NO.OF RESPONDENTS 11 10 14 15 50

PERCENTAGE 22% 20% 28% 30% 100%

As per my survey, the above table reflects that advertisements 11 (22%), publicity 10 (20%), sales promotion 14 (28%), word of mouth 15 (30%) are the factors influencing to purchase of AIRTEL.

Blue Pie Graph representing influencing factors to purchase of AIRTEL

64

NO.OF RESPONDENTS

15

11

10 14

The Connection that Most Prefer By Advertisements

Attributes Reliance Airtel Idea Vodafone Total

No. of Respondents 9 21 10 10 50

Percentage 18% 42% 20% 20% 100%

THE FLOATING GRAPH REPRESENTING THE CONNECTION THAT MOST PREFER BY ADVERTISEMENTS

65

FACTORS PREPAID POSTPAID TOTAL

NO.OF RESPONDENTS 35 15 50

PERCENTAGE 70% 30% 100%

PREPAID & POSTPAID CONNECTIONS OF AIRTEL

PREPAID 35 (70%), POSTPAID 15 (30%), prefer to purchase AIRTEL.

25 20 15

According to my survey, it can be seen from the above table that indicates

21

BAR GRAPH REPRESENTING PREPAID & POSTPAID CONNECTIONS OF

10 5

AIRTEL

10

10

18%
0 Reliance Airtel

42%
Idea

20%

20%
Vodafone

66

FACTORS PREPAID POSTPAID TOTAL

NO.OF RESPONDENTS PERCENTAGE 35 15 50

35

70% 30% 100%

35 30 25 20 15 10 SWOT ANALYSIS STRENGTH

15

70%

30%

AIRTEL -5 CONCEPT, ATHOUGHT, A NOTION. AIRTEL IS ABOUT SIMPLE THOUGHTS THAT HAVE THE POWER TO ENHANCE LIFE 0 NO.OF RESPONDENTSPERCENTAGE PREPAID POSTPAID The AIRTEL chitchat is rechargeable SIM card easily available across a host of dealer and retail outlets all over your city.

The AIRTEL is like an ocean full of technology and information full of mobile world. It has good research and development will equipped with efficient work force. National and international roaming. AIRTEL is the leading cellular service provider, with a footprint, in 20 states covering all four metros It has over Ten million satisfied customers.

67

 An AIRTEL network connects its user to the other network within seconds compared to other networks. AIRTEL completes the formalities of the Government by fulfilling the statutory requirements in taking the proof of the customer.

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WEAKNESS An AIRTEL network is weak in rural places. AIRTEL is stricter in govt. statutory proofs that should be made flexible to the customer. Poor available of recharge coupons for the customer in the city and some other places. Unlike the other operator (BSNL) billing pulse is 60 sec. Poor knowledge to the retailers about AIRTELs packages, schemes and promotional activities. OPPORTUNITIES Huge sales can be expected if proper eye catching advertisements, promotional activities are designed for new customers. By giving quick and proper services AIRTEL can become the No.1 operator in India in cellular industry.

THREATS

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 The product is at the growth stage of the company has to stay ahead of its competitors and persuade the customer to prefer the product. Company personnel should be taken but it should be customer friendly, otherwise the company may lose the sales. The company should give priority to the rural customers, so as get good business otherwise, other Operator may capture the market.

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Chapter V

FINDINGS SUGGESTIONS

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FINDINGS The company is advertisement is not fair and is not reaching to all people. The advertisement is difficult to understand. AIRTEL is not concentrating on the promotional activities for the customers and for the retailers. AIRTEL is not giving gifts for the customers. The company is not concentrating on other types of advertising media. The package design is not communicative and eye catching, so package design and color have to blend harmoniously to make the package communication effective. Network is not reaching to rural villages. Talk time is very less in Prepaid Cards. The company is not conducting road shows so as to get awareness in the public about the product and services. Improve the marketing personnel and they should give full knowledge to the customers and retailers. AIRTEL must improve their personnel selling direct contacting customers to give awareness of their products.

SUGGESTIONS AIRTEL is not giving gifts for the customers. The company is not concentrating on other types of advertising media. The package design should be communicative and eye catching, so package design and color have to blend harmoniously to make the package communication effective. Network should be expanding to rural villages. 72

 Talk time must be increased in Prepaid cards. Reduce the Tariff rates to increase the market share. The company should conduct road shows so as to get awareness in the public about the product and services. Improve the marketing personnel and they should give full knowledge to the customers and retailers. Airtel should Introduce Top Up cards from 10 rupees on wards to Increase more sales. The offers should be fairer and should also necessary to bring new SIIM cards with fascinating offers. It will help full in Increasing of Sales if The Airtel brings cards for the different groups of people such as, Students, Employees, Girls etc.,

CONCLUSION

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CONCLUSION I, . from project conclude that promotion of any service can be successfully executed by creating awareness through word of mouth and by maintaining the service according to Advertising and Sales Promotional Activities.

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QUESTIONNAIRE BIBLIOGRAPHY

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QUESTIONNAIRE 1. 2. Name: Occupation: Employee 3. 4. Business Profession Student

Addresses for Communication: Monthly Income (or) Income Level 2000-4000 8000-12000 4000-8000 More than 12000

5.

Are you the user of Mobile? Yes No

6. 7.

Mobile Number: If yes which connection you had? Airtel Reliance Others Idea Hutch

8.

If you have Airtel Connection, how are their services? Very god Good Average Not

Satisfied 9. Are you satisfied with Airtel pulse rate Yes 10. No

You are pre-paid customer (or) post paid customer? Prepaid Postpaid

11

If postpaid you are satisfied with Airtel rental plans? Yes No 76

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12.

Who influenced you to take Airtel connection? Advertisement Friends/Relatives Goodwill/Fame Personal Choice

13.

What type of promotional activity you preferred in purchasing Airtel? Advertisement Publicity Sales Promotion Word of Mouth

14.

Which of the connection that you most prefer by advertisements? Airtel Reliance Idea Hutch

15.

Specify your level of satisfaction? Very Good Maintenance Price Performance After Sales Service

Good

Average

Satisfactory

16. ...

Any Suggestions? ............................................................... ...............................................................

... ............................................................... ...

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BIBLIOGRAPHY COMPANY PROFILE PRINCIPLES OF MARKETING MANAGEMENT MODERN MANAGEMENT NEWSPAPERS ---------PHILIP KOTLER R.S.N.PILLAI THE HINDU THE ECONOMIC TIMES DECCAN CHRONICLE THE TIMES OF INDIA ---www.bharati.com

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