FACULTY OF MANAGEMENT STUDIES

INSTITUTE OF RURAL
MANAGEMENT
JAIPUR

SUBMITTED TO:
SUBMITTED BY:
PROF.TERJANI GOYAL
NEHA SHARMA
SECTION A
PGDM-BM
ROLL NO. 2853

Introduction
Telecom services have been acknowledged globally as an essential tool for the socio-economic
development of a nation. India is currently the worlds second-largest telecommunications
market and has registered exceptional growth in the past few years.
The Indian mobile economy is growing rapidly and will contribute approximately US$ 400
billion to Indias gross domestic product (GDP), according to report prepared by GSMA in
collaboration with BCG.
The rapid strides in the telecom sector have been facilitated by liberal policies of the
Government of India that provide easy market access for telecom equipment and a fair regulatory
framework for offering telecom services at affordable prices. The deregulation of foreign direct
investment (FDI) norms has made the sector one of the fastest growing and a top five
employment opportunity generator in the country.

ABOUT VODAFONE :
Vodafone Group Plc (Vodafone) is a mobile communications company which provides
services to mobile voice, messaging, data and fixed line. The Companys money
transfer service, M-Pesa, enables people in emerging markets, to send and receive
money through a mobile phone. The Company also has products such as international
money transfer, savings and loans, salary disbursements and access to insurance
products in different markets. Vodafone Red offers consumers and businesses a
package with mobile data allowances, unlimited calls and texts, plus cloud and back-up
services to secure personal data. Vodafone Cloud allows customers to store their
personal digital content, such as contacts, photos and videos in the Vodafone network
and to access it on the move from any connected device. Vodafone OneNet integrates
landlines and mobiles providing a communication solution. Vodafone Secure Device
Manager gives customer a way to manage many of their smart devices

Title of the study : An analysis of awareness and perception

of customers towards mobile money with reference to
Vodafones M-Pesa

INTRODUCTION TO M-PESA :

th
Vodafone India had partnered with ICICI and launched M-Pesa on 18 April 2013.
Till June 2014 the m-pesa users in jaipur region is 10,000 approx out of the
estimated population of 3.3 Million ( E-source -www.livemint.com/Money/.../Product-crack-MPesa.html)

 Vodafone completed the national rollout of M-Pesa in India in June 2014 & its
distribution of the mobile money service is limited by the countrys banking
regulation.
The operator, which partners local financial institution ICICI Bank on the rollout,
launched M-Pesa in the state of Andhra Pradesh to reach national coverage M-Pesa
is available through 60,000 agent outlets across India .
M-Pesa service is available across authorized Vodafone agents and exclusive stores
and can be accessed only by Vodafone subscribers but they dont have to be an
ICICI bank account holder .

Objective of the study :

To analyze the position of Vodafone on the subscriber bases among the college
students

To study the awareness and customers response towards mobile money &
Vodafones M-Pesa.

To Provide Promotional Strategies to the Company for the product.

SECTOR ANALYSIS
Market Size
Telecommunications is one of the prime support services needed for rapid growth and
modernisation of various sectors of the economy. Driven by strong adoption of data consumption
on handheld devices, the total mobile services market revenue in India will reach US$ 29.8
billion in 2014 and is expected to touch US$ 37 billion in 2017, registering a compound annual
growth rate (CAGR) of 5.2 per cent, according to research firm IDC.
According to a study by GSMA, it has been expected that smartphones will account for two out
of every three mobile connections globally by 2020 and India is all set to become the fourth
largest smartphone market.
India is projected to have 213 million mobile internet users by June 2015, a 23 per cent rise over
a six month period, according to Mobile Internet in India 2014 report.
The broadband services user-base in India is expected to grow to 250 million connections by
2017, according to the UK-based GSM Association (GSMA).
India saw the fastest growth in new mobile-phone connections with 18 million net additions in
the third quarter of 2014, followed by China with 12 million new additions, according to a report
by Swedish mobile network equipment maker Ericsson.
The Indian telecom sector is expected to create four million direct and indirect jobs over the next
5 years on the back of the governments efforts to increase penetration in rural areas along with
the growth in the smartphone numbers and internet usage, according to estimates by Randstad
India. The telecom sector has been growing aggressive at an average for 35 per cent a year for
close to two decades, said Mr K Uppaluri, CEO, Randstad India.

Government Initiatives
The government has fast-tracked reforms in the telecom sector and plans to clear the proposal
allowing spectrum trading and sharing ahead of the year-end deadline as it wants to lift the
business sentiment for the forthcoming airwave auction. Some of the other major initiatives
taken by the government are as follows:
The Government of Uttar Pradesh (UP) has secured investment deals valued at Rs 5,000
crore (US$ 804.64 million) for setting up mobile manufacturing units in the state.
The Government of India plans to roll out free high-speed wi-fi in 2,500 cities and towns
across the country over the next three years and the programme, involving an investment
of up to Rs 7,000 crore (US$ 1.12 billion), will be implemented by state-owned Bharat
Sanchar Nigam Ltd (BSNL).
Citizens of India are expected to get a minimum of 2 megabits per second (MBPS) Wi-Fi
speed at every government owned service point such as railways stations, airports, bus
stops, hospitals and all government departments that deal with the public on a daily basis.
The Union Cabinet of India has approved the largest ever telecom spectrum auction that
is targeted to fetch at least Rs 64,840 crore (US$ 10.43 billion). The government will sell
380.75 megahertz (MHz) of second generation (2G) spectrum in three bandsthe
premium 900 MHz, 1800 MHz and 800 MHz.
To speed up the national optical fibre network (NOFN) project, the Department of
Telecommunications (DoT) has advised officials to use public buildings such as post
offices, railway stations and schools.
The Government of Kerala has decided to allow mobile telecom service providers to set
up towers on government land and buildings. This is the first time that a State
Government has opened its own land, buildings and offices to mobile companies

Market Structure in the Telecom Industry

Teledensity means number of telephones per hundred people. The current teledensity in
India is 78.10. However, there is a large disparity between urban teledensity and rural
teledensity. The urban teledensity stands at 169.37 whereas rural teledensity is 38.53
only. The reason for the slow growth in teledensity in the rural areas is that it is less
attractive for the telecom service providers to invest. Furthermore, providing service in
the remote and rural areas also requires massive investment.
Teledensity in India (Rural, Urban and Cumulative) 2007 December, 2011

Source: Department of Telecommunication, Annual Report 2011-2012

Public and Private Share in the Market

Annual Growth Rate in the Telecom Industry (1981 to December, 2011)

CAGR: Compounded Annual Growth Rate

Source: TRAI, Telecom Sector in India: A Decadal Profile
After the Government of India gave up its monopoly in the telecom sector in 1992 the
growth of the telecom industry was slow due to lack of roust policy. However, with the
change in the policy and licensing regime in the 1999, it is evident from the above graph
that the telecom industry recorded a phenomenal growth. There was 35 per cent growth
in the compounded annual growth rate.

Wireless
Market share in the wireless subscription as on February, 2012

The pie chart clearly shows

that currently the private
sector dominates the cellular
market. However, this was
not the case in the
beginning. The changes in
the market structure were
due to the changes in
telecom policy in 1999. The
growth rate of number of
wireless subscribers from
1996-2011 in the graph
below, clearly depicts the
growth
in
wireless
subscribers after the change
in policy in 1999. Currently,
the three main players in the
mobile services sector are
Vodafone, Reliance and
Bharti.

Wireline
Market share in the wireline subscription as on December, 2011
In the basic telecom services
or wireline services the
incumbent

Bharat
Sanchar
Nigam
Limited
(BSNL) has the majority
share in the market. This is
due to the expanse of the
infrastructure available to the
incumbent, and its ability to
provide
basic
telecom
services in the rural and
remote areas. The private
wireline service providers do
not have the capital to invest
in
building
such
infrastructure and there is no
profit
in
such
capital
investment
as
well.
Therefore,
the
private

players mainly concentrate

in urban areas where they
can earn more revenue.