Swot Analysis of Rcom
SWOT analysis of RCOM in 2006:
Strengths: * Strong brand recognition * Well Integrated operations * Significant execution and technological capabilities * Strong distribution channel ( RWorld, FLAG Telecom ) * Unified License obtained by RCom in 8 circles
Weaknesses: * Low ARPU compared to competitors * Weakness in Rural Market * Low capabilities in Ethernet and application delivery services
Opportunities: * Low penetration Rates * Strategic Alliances ( FLAG) * Global expansion due to resource based acquisition of FLAG * Huge GSM subscriber base (76.67%) with economies of scale for GSM operators * Telecom policy in more in favor of GSM than CDMA * Higher ARPU in GSM sector
Threats: * Increasing competition with domestic players * Decreasing ARPU due to competition * High regulation in Indian Telecom sector * Changing political scenario could change Regulations * High switching costs for customers to move to GSM
Indian Telecom Industry in 2006
* India’s Telecom Network had 203 million connections * Third largest in the world and the second largest among the emerging economies of Asia * One of the key sectors responsible for India’s resurgent India’s economic growth ( 1% of GDP ) * Contributed 30 percent to India’s total service tax revenue * Liberal Government policies to provide easy access to telecom equipment and fair regulatory framework * Robust growth in Tele-density (11.4% in 2006) * Increasing preference to wireless service compared to landline ( 93 million users in 2006 ) * Increasing participation of private players. 57% share of Industry by PSUs * Great opportunities in GSM. 70% Technology market share of GSM IN 2006 * A liberal licensing scheme was set up to increase Internet penetration across the country with 10.83 million subscribers in Dec 2006. Reliance communication had a 10.32% subscriber base in Dec 2006 *
Strengths: * Strong brand recognition * Well Integrated operations * Significant execution and technological capabilities * Strong distribution channel ( RWorld, FLAG Telecom ) * Unified License obtained by RCom in 8 circles
Weaknesses: * Low ARPU compared to competitors * Weakness in Rural Market * Low capabilities in Ethernet and application delivery services
Opportunities: * Low penetration Rates * Strategic Alliances ( FLAG) * Global expansion due to resource based acquisition of FLAG * Huge GSM subscriber base (76.67%) with economies of scale for GSM operators * Telecom policy in more in favor of GSM than CDMA * Higher ARPU in GSM sector
Threats: * Increasing competition with domestic players * Decreasing ARPU due to competition * High regulation in Indian Telecom sector * Changing political scenario could change Regulations * High switching costs for customers to move to GSM
Indian Telecom Industry in 2006
* India’s Telecom Network had 203 million connections * Third largest in the world and the second largest among the emerging economies of Asia * One of the key sectors responsible for India’s resurgent India’s economic growth ( 1% of GDP ) * Contributed 30 percent to India’s total service tax revenue * Liberal Government policies to provide easy access to telecom equipment and fair regulatory framework * Robust growth in Tele-density (11.4% in 2006) * Increasing preference to wireless service compared to landline ( 93 million users in 2006 ) * Increasing participation of private players. 57% share of Industry by PSUs * Great opportunities in GSM. 70% Technology market share of GSM IN 2006 * A liberal licensing scheme was set up to increase Internet penetration across the country with 10.83 million subscribers in Dec 2006. Reliance communication had a 10.32% subscriber base in Dec 2006 *