overview of telecommunication sector in india and bsnl salem ssa
TRANSCRIPT
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CHAPTER 3
OVERVIEW OF TELECOMMUNICATION SECTOR IN
INDIA AND BSNL SALEM SSA
3.1 Evolution of Indian Telecommunication Industry in India
During British Raj, Rajdhani of East India Company was at Calcutta and then
the capital got shifted to Delhi in 1911 by Lord Hardinge and gradually the power
center was shifted to Delhi and continued to be capital of India and after
independence, New Delhi became the capital of India. When telecom operations were
first started, PWD ran the business with headquarters at New Delhi. Then, the control
of telecom operations was gradually transferred from Public Works Department
(PWD) to Director General Postal and Telegraph (DGP&T), from DGP&T to
Department of Telecommunication (DOT), from DTO to Department of Telecom
Services (DTS) and finally landed in Bharat Sanchar Nigam Limited (BSNL). The
head quarters of telecom operations during all these years of transition was New Delhi
and for BSNL and Mahanagar Telephone Nigam Limited (MTNL) after their coming
into existence also, still New Delhi continues to be the head quarters.
During pre-independence days as far as telecom operations are concerned, the
four metros Delhi, Calcutta, Bombay and Madras were given special status and after
independence also it continues. As on today, telecom operations in Mumbai and New
Delhi Metropolitan areas are covered under MTNL, where as separate Telecom
Operation Circles were created to cater for Chennai and Kolkata Metropolitan areas,
which came under BSNL.
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BSNL is fully owned Government Public Sector Unit (PSU), offering wire
line, wireless, data and long distance services on pan India basis except Mumbai and
New Delhi, which come under MTNL jurisdiction. Each state in India is named as a
Telecom Circle which is called “Primary Switching Area” and one or more Revenue
Districts of the state circle are grouped together to form a Telecom SSA (Secondary
Switching Area).
The total number of executives working in BSNL (entire country) are around
48,420 and there are around 2,497 executives working in Tamil Nadu Telecom Circle
alone. Some under developed / far flanged / border telecom circles may have less
strength of executives when compared to other telecom circles. Altogether there are
26 Circles in India and Tamil Nadu Telecom Circle (consisting of Tamilnadu state
and Puducherry, except Chennai Meropolitan area) has 17 SSAs. The various
historical events of Indian Telephone systems are presented in Table 3.1.
Table 3.1 Historical Events in the Evolution of Telecommunication
Sector in India
Year Events
November
1850
The first Experimental Electric Telegraph Line was started between
Calcutta and Diamond Harbour.
October 1851 The Line completed and opened for East India Company‟s traffic.
April 1852 Dr. O‟Shaughnessy‟s report on successful working of the
experimental Line landed before the Bengal Govt.
November
1953
Construction started for 4,000 miles of telegraph lines connecting
Calcutta and Peshawar in the North via Agra and Bombay through
Sindwa Ghats, Bombay and Madras in the South as well as
Ootacamund and Bangalore.
October 1854 The first Telegraph Act enacted.
February 1855 Electric telegraph opened to public traffic.
1857 The „Mutiny‟. Electric Telegraph saved India‟ – Dalhousie.
1858 First Indo-Ceylon cable laid
January 1865 First Indo-European telegraphs communication effected.
1867 A new cable laid between India and Ceylon.
Contd…
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Table 3.1 Historical Events in the Evolution of Telecommunication Sector in
India (Contd…)
Year Events
1871 International Telegraph Conference at Berne and Rome.
October 1872 Interference to Telegraph Working by Magnetic Storm.
1873 Duplex Telegraphy introduced in India between Bombay and
Calcutta
1873 Indigenous manufacture of cables for river crossing by Telegraph
Workshops, Alipore.
August 1875 The first Private Telephone line supplied by the Telegraph
department.
August 1877 Indian Telegraph Department erected telegraph line between
Srinagar and Gilgit on behalf of the Maharaja of Kashmir.
1878 For the first time (except the first year) the receipt of the Indian
Telegraph Department exceeded the expenses, netting a surplus Of
Rs. 182,128.
1880 I.T.D. transferred responsibility of the Ceylon Telegraph System and
offices to the Ceylon Government.
November
1881
Licenses granted to Private Companies to operate Telephone Systems
at Madras, Bombay, Rangoon, Calcutta.
January 1882 Opening of telephone exchange at Bombay.
October 1885 Upper Burma Campaign – I.T.D. helps in providing communications
for swift advance. Introduction of Quadruplex telegraphy and
copper wire for transmission.
1886 Copper wire for transmission between Bombay and Madras
Instead of iron wire.
1887 Facilities afforded to Indian Meteorological Service for
communicating „Storm Signals‟ to all places.
1888 Post Office and Telegraph Department combined as quasi-
commercial departments.
January 1889 Death of Dr. O‟Shaughnessy at Southern India.
1892-95 Construction and control of Telegraph System of Kashmir State by
I.T.D.
1895-96 Phonograms introduced for the first time at Bombay and Calcutta.
1902 First wireless telegraph station established between Saugor Islands
and Sandheads.
1903 Field Telegraphs for Sikkim, Tibet.
1903 Re-organisation of Superior Establishment in Telegraph.
Departmental Wireless Telegraph introduced.
1904 Wireless Telegraph introduced between Elephant Point and Amherst.
1905 Control of Telegraph Department transferred from P.W.D. to
Commerce and Industry Department, except for matters connected
with Buildings and Electricity.
Contd…
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Table 3.1 Historical Events in the Evolution of Telecommunication Sector in
India (Contd…)
Year Events
1906 Baudot system introduced between Calcutta and Bombay, and
Calcutta and Rangoon.
August 1907 Central Battery working of telephones was first introduced in
Kanpur.
December
1907
Women signalers employed for the first time.
1907-08 Wireless Telegraph working between Diamond Islands and Port Blair
were successful during the nights of cold weather.
1908 Wheatstone working between London and Calcutta, Madras and
Rangoon.
1909 Wireless Telegraph Traffic was maintained with ships at-sea from
Calcutta stations at Diamond Island, Table Island, etc.
April 1910 Birth of Technical Branch as a separate organization for dealing with
the technical matters under Electrical Engineer-in-Chief.
December
1910
Telegraph Department awarded a gold medal in the United Provinces
Exhibition held at Allahabad.
1910-11 Introduction of Circle Scheme in the department and
decentralization.
1912-14 Amalgamation of Postal and Telegraph Department under a single
Director-General. Reversion of control of P&T again to P.W.D.
1913-14 First automatic exchange at Simla with a capacity of 700 lines with
400 actual connections.
1914-18 Production of war materials by Workshops.
April 1919 Lady operators employed in Simla Exchange.
1920 Madras-Port Blair route for Wireless Telegraph opened.
May 1921 Recurrence of Magnetic Storm after a period of 50 years. Telegraph
Traffic in south India interrupted.
August 1921 National Cash Registers introduced in Calcutta C.T.O. for the first
time.
1921 Continuous wave transmitters for wireless telegraphy replaces the
spark transmitters.
1921 Introduction of R.A.X. at Poona.
1922 Department erected a line for Tibetan Government from Gyantse to
Lhassa.
1923 Long distance dialing (90 miles) introduced between Lahore and
Lyallpur.
1923 First Trunk Telephone Circuit in Burma established between
Rangoon and Pegu.
1923-24 152 questions relating to Department were asked and answered in the
Legislative Assembly.
1924 Floods and cyclone interrupted Telegraph Traffic throughout India.
1st April 1925 Accounts of the Department re-constituted on the basis of a full-
fledged commercial unit.
Contd…
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Table 3.1 Historical Events in the Evolution of Telecommunication Sector in
India (Contd…)
Year Events
1925-26 Conversion of Delhi Manual system to Auto System. Deluxe
telegrams for greeting messages with foreign countries introduced.
23rd
July 1927 Radio-Telegraph started working between U.K. and India. The
beam station at Kirkee and Dhond opened by Lord Irwin and
greetings exchanged with the King of England.
May 1933 Radio-Telephone communications between England and India
opened by India Radio and Cable Communication Co. Special Trunk
Exchange was installed at Kirkee.
December Indo-Burma Radio-Telephone service started functioning between
Madras and Rangoon.
1936-37 Use of Trunk Lines for broadcasting programmes introduced.
1937 Burma and Aden Telegraph Systems, which were a part of Indian
Telegraph System, separated.
1938-39 Construction of short wave and medium wave wireless telegraph
receivers in a number of stations and direction finding stations at
Gaya and Allahabad.
1940 Introduction of „Urgent Private Inland Trunk Calls‟. Overseas
Telephone Service temporarily suspended due to war conditions.
1942 Bombay Australian wireless Telegraphic service inaugurated.
February 1942 Bombay-China Wireless Service inaugurated. Training center at
Calcutta transferred to Jabalpur.
1942 The Bombay Telephone Workshop was taken over by the I.T.D.
1943 The Jabalpur Telegraph Workshop started.
1943 The Bombay, Calcutta and Madras Telephone Systems were taken
over by I.T.D.
1942-47 Telecommunication Development Scheme came into operation.
A Telecommunication Development Board was set up.
August 1944 Bombay-New York Wireless Telegraph Service was commissioned
into service.
September
1944
Second civilian outlet to U.K., Delhi and London Wireless Telegraph
Service inaugurated.
1947 India was represented at the important Atlantic City International
Radio Conference.
1947 Direct Telephone link to Kashmir and Assam.
1947 The late Sardar Patel launched Jalaprabha on Telephone Carrier
Channel and Wireless.
1st June 1949 Introduction of Hindi telegram in Devanagari script.
December
1949
„Own Your Telephone‟ Scheme inaugurated.
1949 Wireless Station commenced functioning at Srinagar.
1949-50 State Merger Scheme; the P&T gradually took over the respective
State P&T Systems.
Contd…
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Table 3.1 Historical Events in the Evolution of Telecommunication Sector in
India (Contd…)
Year Events
January 1950 India-Afghanistan Wireless Telegraph Service inaugurated. Radio-
Telephone Service between India and Nepal inaugurated.
May-June
1950
Coastal Wireless Stations at Karwar, Ratnagiri and Mangalore
started.
October 1950 The Wireless Telephone Service between Indonesia and India
opened.
November
1950
Private Priority Telegram introduced.
1950
December
„Own Your Telephone Exchange‟ Scheme began to operate.
„Telegraph Wires (Unlawful possession) of 1950, Act was passed by
Parliament.
1950 March The First Asian Games held at Delhi was conveyed by a direct Radio
telephoto service between India and Japan.
1951 Innovation of Radio-Telephoto Service.
December
1951
Launching of S.S. Jalapushpa of Scindia Steam Navigation Company
at Vizagapatam by Shri N.V. Gadgil from Bombay through telegraph
circuits. Wireless Telegraph link to Thailand.
June 1951 Wireless Telegraph link to Moscow.
July 1951 Wireless Telegraph and Telephone link to Egypt.
First Toll Cable: Delhi-Ghaziabad.
September
1951
Wireless Telegraph and Telephone link to Iceland.
Mar/Aug 1952 Wireless Telephone link to Iran/Japan.
1953 12 channel carrier systems introduced.
1953 First Automatic Exchange in Calcutta. Telex Service in Bombay.
First 12-Channel Carrier Systems. Introduction of Frequency
Modulation. Mechanisation of Telephone Revenue Accounting.
July 1959 First Coaxial route between Delhi-Agra commissioned.
November
1960
First subscriber trunk dialing route commissioned between Kanpur
and Lucknow.
December
1965
First microwave route between Calcutta-Asansol opened
February 1967 First crossbar-local exchange commissioned at Mambalam – Madras.
December
1967
First crossbar trunk automatic exchange out into service at Madras
March 1975 First PCM system between City and Andheri Telephone exchanges
commissioned in Mumbai.
„Advanced Level Telecom Training Centre‟ commenced training
activities from Delhi to be eventually shifted to its own campus in
Ghaziabad.
Contd…
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Table 3.1 Historical Events in the Evolution of Telecommunication Sector in
India (Contd…)
Year Events
1976 Installation of SPC gateway telex exchange and introduction
of International Subscriber dialed telex service.
First Digital Microwave System introduced in Calcutta Junction
network
1978 Introduction of Press Bulletin Service (PBS).
„Telecommunications Consultants India Limited‟ set up in the
public sector to provide consultancy services in telecommunication.
1979 First optic fibre system for local junction commissioned at Pune.
1980 First satellite earth station for domestic communications established
at Secunderabad (U.P.)
1981 Troposcatter system link between India and U.S.S.R. inaugurated.
1982 First SPC electronic digital telex exchange commissioned at
Bombay.
1983 First SPC analogue electronic trunk automatic
exchange commissioned at Bombay.
1984 „Centre for Development of Telematics (C-DOT) was established as
a society for development of digital switching system.
1985 First Mobile Telephone Service introduced at Delhi.
First Radio Paging introduced in Delhi.
1986 „Mahanagar Telephone Nigam Limited‟ and „Videsh Sanchar Nigam
Limited‟ were established.
1987 First digital coaxial 140 Mb/s between Ahmedabad and
Rajkot commissioned.
1988 International gateway packet switch system commissioned
at Bombay.
1991 I-Net exchange commissioned.
Inmarsat coastal earth station at ARVI to provide
maritime communication.
Voice Mail Service (VMS) introduced in Delhi.
1994 Announcement of National Telecom Policy.
Cellular telephone service started in Calcutta and Delhi.
Internet service provided by VSNL.
ISDN service started commercially.
1995 The “Telecom Regulatory Authority of India” was set up.
Wireless in Local Loop (WLL) telephone system introduced in
MTNL Delhi.
Indo – Nepal Optical Fiber link Commissioned.
Basic Telecom Services opened for private competition.
1998 New ISP Policy was announced.
1999 New Telecom Policy
DOT is separated into two organs-DTS and DTO
2000 Bharat Sanchar Nigam Limited (BSNL) is born Source : www.bsnl.co.in
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3.2 Telecom Scenario in India
The Indian telecommunications industry is one of the fastest growing one in
the world. The industry has witnessed consistent growth during the last year on the
back of rollout of newer circles by operators, successful auction of third-generation
(3G) and Broadband Wireless Access (BWA) spectrum network rollout in semi-rural
areas and increased focus on the Value Added Services (VAS) market.
According to the Telecom Regulatory Authority of India (TRAI), the number
of telephone subscriber base in the country reached 742.12 million as on October 31,
2010, an increase of 2.61 per cent from 723.28 million in September 2010. With this
growth, the overall tele-density (telephones per 100 people) has touched 62.51 per
cent. The wireless subscriber base has increased to 706.69 million at the end of
October 2010 from 687.71 million in September 2010, registering a growth of 2.76
per cent.
Meanwhile, Indian Global System for Mobile Communication (GSM) telecom
operators added 17.45 million new subscribers in November 2010, taking the all-India
GSM cellular subscriber base to 526.18 million, according to the Cellular Operators
Association of India (COAI). The GSM subscriber base stood at 508.72 million at the
end of October 2010.
3.3 Value-Added Services (VAS) Market
Mobile VAS include text or Short Message Service (SMS), menu-based
services, downloading of music or ring tones, mobile TV, videos and sophisticated m-
commerce applications. As per a report, „India Telecom 2010‟ released by KPMG in
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December 2010, currently, the VAS market is worth US $2.45 billion to US $2.67
billion, which is around 10 per cent of the total revenue of the wireless industry. The
share of VAS in wireless revenue is likely to increase to 12-13 per cent by 2011, on
the back of increased operator focus on VAS due to continuous fall in voice tariffs,
increasing penetration of feature rich handsets, availability of vernacular content and
increased user adoption of VAS applications.
3.4 Major Investments in Telecom Industry in India
The booming domestic telecom market has been attracting huge amounts of
investment which is likely to accelerate with the entry of new players and launch of
new services. According to the Department of Industrial Policy and Promotion
(DIPP), the telecommunications sector which includes radio paging, mobile services
and basic telephone services attracted Foreign Direct Investment (FDI) worth US
$1,062 million during April-October 2010‟-2011. The cumulative flow of FDI in the
sector during April 2000 and October 2010 is US $9,993 million.
As per an industry report, the telecom industry witnessed Merger and
Acquisition (M&A) deals worth US $16.60 billion during April-December 2010,
which represented 28.26 per cent of the total valuation of the deals across all the
sectors during the period analysed. There were 10 inbound, outbound and domestic
M&A deals in the telecom sector during the first nine months of the current fiscal.
The biggest M&A deal in the sector was made by telecommunications service
provider Bharti Airtel through the acquisition of Zain‟s African mobile services
operations in 15 countries. The deal involved a transaction of US $10.7 billion. In
another deal, Bharti Airtel acquired 100 per cent stake of Telecom Seychelles Ltd for
US $62 million.
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Other major M&A deals included the acquisition of 95 per cent stake in
Infotel Broadband for US $1,032.26 million by Reliance Industries and 26 per cent
stake of US-based mobile chipmaker Qualcomm‟s Indian arm for US $57.72 million
by India's Tulip Telecom and Global Holding. Further, India-based GTL
Infrastructure Ltd. has bought 17,500 telecom towers of Aircel Ltd. for US $1,702.95
million.
3.5 Manufacturing Telecom Equipments in Telecom Industry
The Indian telecom industry manufactures a vast range of telecom equipment
using state-of-the-art technology. As per a press release by the Ministry of
Communications and Information Technology, the production of telecom equipments
in value terms is expected to increase from US $10.87 billion during 2008-09 to US
$11.87 billion in 2010-2011. Favourable factors such as policy moves taken by the
Government, incentives offered, large talent pool in Research and Development
(R&D) and low labour cost can provide an impetus to the industry. Exports increased
from US $89.24 million in 2002-2003 to US $3 billion in 2009-2010 accounting for
26 per cent of the total equipment produced in the country and it is expected to
increase to US $3.33 billion in 2010-2011.
Meanwhile, telecom regulator TRAI has released a consultation paper on
„Encouraging Telecom Equipment Manufacturing in India‟ seeking views of
stakeholders for promoting R&D and manufacturing of telecom equipment in the
country. The consultation paper issued on December 28, 2010 aims at discussing,
debating and finalising measures for promotion of R&D and creation of intellectual
property as well as manufacture of telecom equipment and electronic components in
India.
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Further, the Indian mobile handsets market continued to grow in the third
quarter 2010 as well to record a quarter-on-quarter growth of 3.6 per cent to touch
40.08 million units in the quarter, according to market intelligence firm International
Data Corporation‟s (IDC) India Quarterly Mobile Handsets Tracker. The year 2010 is
expected to end with total mobile handset sales of 155.9 million units.
"We expect India to move up to the third spot (after China and South Korea)
with a share of 8.5 per cent of the total (estimated) Asia Pacific (Apac) telecom
equipment production revenue of US $277 billion by 2014," Gartner said. The firm
estimates India's telecom equipment production revenue to grow at a Compound
Annual Growth Rate (CAGR) of 17.1 per cent to reach US $22.6 billion in fiscal
2014. India will be the fastest growing telecom equipment production market in the
Apac region over the next five years, it predicts.
3.6 Rural Telephony
The rural telephone connections have gone up from 3.6 million in 1999 to 12.3
million in March 2004 and further adding to 200.77 million in March 2010. Their
share in the total telephones has constantly increased from around 14 per cent in 2005
to 32.75 per cent at the end of October 2010. The rural subscribers have grown to
243.04 million at the end of October 2010. The wireless connections have
contributed substantially to total rural telephone connections; it stands at 233.95
million in October 2010. During 2010-2011, the growth rate of rural telephones was
21.05 per cent as against 18.69 per cent of urban telephones.
The private sector has contributed to the growth of rural telephones as it
provided about 84.27 per cent of rural telephones during October 2010.
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The government plans to connect all revenue villages in India either through
landline, mobile or Wireless Local Loop (WLL) by February 2011. “We have already
connected about 96 per cent of the revenue villages. The remaining 25,000 villages
will have connectivity by February 2011,” stated Mr. Sachin Pilot, Minister of State
for Communications and Information Technology.
Further, the Government, under Bharat Nirman II Programme, has envisaged
providing broadband coverage to all 250,000 Gram Panchayats by 2012.
3.7 Policy Initiatives by Government
The government plans to formulate a comprehensive „National Telecom
Policy 2011‟ including the recognition of Telecom as infrastructure and as an
essential service, encouraging Green Telecom, steps to accelerate migration from
Internet Protocol Version (IPv) 4 to IPv6 at the earliest, release of IPv6 standards by
Telecom Engineering Centre for implementation in the country, etc., as per a press
release by the Ministry of Communications and Information Technology.
Further, the government plans to take concrete steps towards finalisation of
„National Broadband Plan‟ including strategy for implementation and initiation of
steps for roll out of optical fibre.
The government has taken many proactive initiatives to facilitate the rapid
growth of the Indian telecom industry which include,
1) In the area of telecom equipment manufacturing and provision of IT-
enabled services, 100 per cent FDI is permitted,
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2) No cap on the number of access providers in any service area. In 2008, 122
new Unified Access Service (UAS) licenses were granted to 17 companies
in 22 services areas of the country,
3) Revised subscriber based criteria for allocation of GSM and Code Division
Multiple Access (CDMA) spectra were issued in January 2008 and
4) To provide infrastructure support for mobile services a scheme has been
launched to provide support for setting up and managing 7,436
infrastructure sites spread over 500 districts in 27 states. As on December
31, 2009, about 6,956 towers have been set up under the scheme.
According to the Consolidated Foreign Direct Investment (FDI) Policy
Document, the FDI limit in telecom services is 74 per cent subject to the following
conditions:
1) This is applicable in case of Basic, Cellular, Unified Access Services,
National/ International Long Distance, V-Sat, Public Mobile Radio
Trunked Services (PMRTS), Global Mobile Personal Communications
Services (GMPCS) and other value added Services,
2) Both direct and indirect foreign investment in the licensee company shall
be counted for the purpose of FDI ceiling. Foreign Investment shall
include investment by Foreign Institutional Investors (FIIs), Non-resident
Indians (NRIs), Foreign Currency Convertible Bonds (FCCBs), American
Depository Receipts (ADRs), Global Depository Receipts (GDRs) and
convertible preference shares held by foreign entity. In any case, the
'Indian' shareholding will not be less than 26 per cent,
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3) FDI up to 49 per cent is on the automatic route and beyond that on the
government route. FDI in the licensee company/Indian
promoters/investment companies including their holding companies shall
require approval of the Foreign Investment Promotion Board (FIPB) if it
has a bearing on the overall ceiling of 74 per cent. While approving the
investment proposals, FIPB shall take note that investment is not coming
from countries of concern and / or unfriendly entities,
4) The investment approval by FIPB shall envisage the conditionality that the
Company would adhere to license Agreement and
5) FDI shall be subject to laws of India and not the laws of the foreign
country / countries.
3.8 The Road Ahead
According to a report published by Gartner Inc in June 2009, the total mobile
services revenue in India is projected to grow at a compound annual growth rate
(CAGR) of 12.5 per cent from 2009-2013 to exceed US $30 billion. The India mobile
subscriber base is set to exceed 771 million connections by 2013, growing at a CAGR
of 14.3 per cent in the same period from 452 million in 2009. This growth is poised
to continue through the forecast period, and India is expected to remain the world's
second largest wireless market after China in terms of mobile connections.
"The Indian mobile industry has now moved out of its hyper growth mode, but
it will continue to grow at double-digit rates for next three years as operators focus on
rural parts of the country", said Mr. Madhusudan Gupta, senior research analyst at
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Gartner. "Growth will also be triggered by increased adoption of value-added
services, which are relevant to both rural and urban markets".
Mobile market penetration is projected to increase from 38.7 per cent in 2009
to 63.5 per cent in 2013, according to Gartner.
The much-awaited mobile number portability was launched on November 25,
2010 in Haryana and will be available to more than 700 million subscribers from
January 20, 2011 across the country. As continued efforts of the Government to
increase competition in the market and to provide wider choice to customer, Mobile
Number Portability will be an important step.
3.9 Profile of BSNL
The BSNL, New Delhi has the following organization structure (Figure 3.1) in
India with a total employment compliment of 2,85,749 (all India).
The vision, mission, objectives and organizational hierarchy of BSNL are as follows
Vision
To become the largest telecom Service Provider in Asia.
Mission
To provide world class telecom infrastructure in its area of operation and to
contribute to the growth of the country's economy.
Objectives
a. to be the Lead Telecom Services Provider,
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b. to provide quality and reliable fixed telecom service to our customer
and thereby increase customer's confidence,
c. To provide mobile telephone service of high quality and become no. 1
GSM operator in its area of operation,
d. To provide point of interconnection to other service provider as per
their requirement promptly,
e. Implementation of Triple play as a regular commercial proposition and
f. To facilitate R & D activity in the country.
b) Figure 3.1 Organisational Structure of BSNL in India
Source: BSNL Reports
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3.10 Present Status of BSNL in Indian Telecom Market
BSNL is an integrated Telecom Service Provider which provides services in
the areas of Landline, Broadband, Mobility, Data Circuits and Managed services in
the form of VOICE, DATA and VIDEO.
As on 31.10.2010, BSNL has a customer base of 106.78 million. Out of this,
26.04 million are Landline connections, 75.02 million are GSM connections, 5.72
million are WLL connections and 8.53 million are Broadband connections.
BSNL has 38,330 Digital Telephone Exchanges, 6.55 lakh route kilometre of
Optical Fibre Cable across the country. BSNL has significant presence in rural areas
with 13.7 million rural landline & WLL customers. Villages to the extent of 96 per
cent are covered with Village Panchayat Telephones (VPT) and 65 per cent villages
are covered with Mobility services.
As far as market share is concerned, BSNL stood 2nd
, on the basis of gross
revenue and has a market share of 73.51 per cent in wire line segment - (1st Position),
11.42 per cent in Wireless segment - (5th
Position) as on 30.09.2010. With regard to
Tamilnadu Telecom Circle is concerned, the number of wireline connections are
34,81,360 and number of wireless connections are 62,79,283. The various
developments taken place in BSNL since its inception 2000 -2011 are presented in
Table 3.2.
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Table 3.2 Developments in BSNL from its Inception
Year Developments
2000 Bharat Sanchar Nigam Limited (BSNL) is born.
Telecom disputes, settlement and Appellate Tribunal were established.
National Long Distance Service opened for private competition.
2001 Convergence Bill to promote, facilitate and develop the carriage and
content of communications tabled in the Parliament.
Policy for GMPCS service has been announced.
Policy for PMRTS has been announced.
Policy for UMS was announced.
2002 International Long Distance Service opened for private competition. Internet
telephony was started.
Country wide Cellone Mobile service launched.
2003 First MPLS-VPN technology goes commercial
2004 International Roaming facility of Cell One service launched.
2005 Broad band facility (with 256 Kbps speed) launched
2006 Broad band facility (up to 2 Mbps speed) launched
2007 Broadband multiplay service launched
2008 IP TV launched commercially
2009 Wi-MAX service launched in select cities across the country
2010 3 G –Third Generation Mobile Services launched.
2011 Nationwide Mobile Number Portability (MNP) service started
Planning to launch country wide BWA technology access. Source : BSNL Report
3.11 Role of BSNL in Future Indian Telecom Scenario
The present Indian Telecom Market scenario is characterized by,
a) Shift from Fixed to Mobile services,
b) Voice becoming a commodity with massive price erosion,
c) Severe competition from around dozen Telecom Operators in each circle
d) Entry of foreign players
e) Severe price competition leading to falling of tariffs and
f) Transition from Technology led business to consumer business
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Hence, future growth of Indian Telecom industry lies in DATA SERVICES.
In such circumstances, BSNL is transforming its organization setup to cater to the
needs of emerging technologies as well as consumer business requirements.
Also, BSNL, being a Government Organisation , has many social obligations
viz., to fulfill Service in rural areas, service during natural calamities/disasters,
emergency situations, elections, etc., The above services have to be maintained, even
though it is economically unviable. For example, when cloud burst occurred in Leh
area, all the communication facilities were destroyed by flash floods. Only BSNL
deputed extra staff to the area and restored the communication link to defence and
public operations in a record time. This was widely appreciated and acknowledged by
Honorable Ministers also. Also, the maintenance of the Telegraph System is
adversely affecting the performance of BSNL. Due to no growth rate of fixed lines,
stiff competition in Mobile segment, removal of Government subsidies and
Government compensation, USO fund obligations, License fee reimbursements, 3G /
BWA spectrum charges, BSNL is incurring losses on these score.
Telecom is a strategic sector and a strong PSU in this sector is a must. Also,
BSNL is fulfilling the country‟s strategic needs to provide a reliable network and
telecommunication services to remote and other sensitive areas. BSNL is also
fulfilling the social obligations of the Government in the Telecom field. Hence, the
Government of India is planning to bear the cost of providing these strategic telecom
needs in sensitive and strategic areas and to bring BSNL in the fore front of Telecom
field by focusing.
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3.12 The Organisational Structure and Hierarchy of BSNL,
Salem SSA
This hierarchy is a well defined and established one in BSNL and is
depicted in figure 3.1 and 3.2. The operation is carried out by the lower most
executives viz. Junior Telecom Officers (JTO) at field level. They will be
reporting to the immediate higher level in the hierarchy called Sub Divisional
Engineers (SDEs) located at the head quarters as well as at the field levels.
These SDEs will be reporting to Divisional Engineers (DEs) who will be mostly
at Head Quarters / Administration (HR) Levels/Field levels. The next level of
reporting goes like Deputy General Manager (DGMs) / General Managers
(GMs).
The Present study is conducted in Salem SSA. This Salem SSA
comprises of two revenue districts namely Salem and Namakkal of Tamilnadu.
This Salem SSA is headed by one General Manager for Administration and
Development of Salem SSA. The General Manager is assisted by three Deputy
General Managers (DGMs for Administration / Planning at Salem and the other
at the district headquarters like Namakkal .
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Figure 3.2 Organisational Structure of Executives/NonExecutives of BSNL
Salem SSA
Executives : The following are included in executive cadre in BSNL,
Salem
Divisional Engineer (DE) will be the overall in charge of that particular
division which he is heading and Sub Divisional Engineers (SDE) and Junior Telecom
Officers (JTO) will be working under him. In all the above cases executive job
profile, and JTO / SDE job profile will be more or less same in most of the sections or
departments depending on staff availability, working hours etc. As DE will be the
overall in charge of that section, monitoring of SDE / JTO work will be the major
profile of DE cadre.
1
2
3
4
5
General Manager (SSA)
Deputy General Manager
(Planning)
Deputy General Manager
(Urban / Rural) Deputy General Manager
(Administration)
Divisional Engineer
(Planning)
Divisional Engineer
(Internal / External) Divisional Engineer
(Administration)
Sub Divisional Engineer
(Eqpt./Operns/Planning)
Sub Divisional Engineer
(Internal/Extnl/Commerci
al)
Sub Divisional Engineer
(HRD)
Jr. Telecom Officer
(Internal/External)
Jr. Telecom Officer
(Commercial) Jr. Telecom Officer
(Eqpt./Operns/Planning)
6
Telecom Technical
Assistant
Telecom Technical
Assistant
Telecom Technical
Assistant
Source : BSNL, Salem SSA; Note : 1 & 2 are top management deputation cadre from Department of
Telecommunications, 3, 4 & 5 are Executive cadres and 6 is Non-Executive
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Non-Executive : The non executive cadre include all telecom technical
assistants (TTAs) who are the base level employees working in BSNL, Salem. They
will be reporting to their immediate supervisors JTOs and SDEs (Figure 3.2).
3.13 Job Roles of Respondent Employees (Executives and Non
Executives)
Job Profile of Executives
Job roles of executives in various departments and sections are as under :
a) HR / Staff Department
The job profile of the executive in HR/Staff Wing includes HR related staff
matters, staff grievances, issuing of transfer orders/posting orders/promotion orders,
attending to the personal claims , personal advances and all other miscellaneous staff
related activities.
b) Commercial Department
The job profile of the executive in Commercial Section includes commercial
related activities, new telephone connection advice note issuing, telephone related
commercial duties, disconnection/reconnection job and all other miscellaneous
commercial related activities.
c) General Section
The job profile of the executive in General Section includes stationery
procuring related activities, printer papers / floppy / CD / DVD purchases
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management, furniture and other contingency expenses and all other miscellaneous
general section related activities
d) Computer Department
The job profile of the executive in Computer Section includes computer
system maintenance, computer purchase, computer networking, software developing
and other related computer peripheral management and all other miscellaneous
computer section related activities
e) Planning Department
The job profile of the executive in Planning Section includes complete
planning activities pertaining to SSA, telephone exchange, outdoor plant and
transmission network planning work, Coordination for installation and commissioning
of new exchanges and transmission equipments, complete planning activity pertaining
to SSA and all other miscellaneous planning related activities
f) Transmission Section
The job profile of the executive in Transmission Section includes
installation/maintenance/testing and trouble shooting of transmission equipments,
attending to faults in transmission equipments and all other miscellaneous
transmission unit related activities
g) Indoor Section
The job profile of the executive in Indoor Section includes installation,
maintenance, routine testing, trouble shooting of indoor telecom equipments viz.,
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battery, power plant, engine and switch equipments and all other miscellaneous
indoor section related activities
h) Outdoor Section
The job profile of the executive in Outdoor Section includes laying of
underground cables, testing and maintenance of the same, maintenance of telephone
post, pillar, distribution box, outdoor line/ attending cable fault and all other
miscellaneous outdoor section related activities.
i) Rural Section
The job profile of the executive in Rural Section includes maintenance of
indoor and outdoor of a group of small and medium exchanges spread over a few
small towns/villages and all the indoor/outdoor/transmission activities for these
exchanges and all other miscellaneous rural section related activities.
j) Civil Section
The job profile of the executives in Civil Section includes new telephone
exchange building construction, existing telephone exchange building maintenance
and all other miscellaneous civil section related activities.
i) Electrical Section
The job profile of executives in Electrical Section includes installation, testing
and commissioning engine alternator, maintenance of A/C plant and maintenance of
all other electrical related works and other miscellaneous electrical section related
activities
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Job profile of Non-Executive (TTA) : The job includes Customer Care
Manning, Out Door fault attending and Assisting JTO / SDE / DE in their job
3.14 Profile of HRD Functions Leading to Organisational Climate
in BSNL, Salem SSA
The Researcher searched the records, circulars and interacted with executives
and other staff of HR Department in BSNL and profiled the prevailing HRM
functions so as to relate the employees perceptions leading to organizational climate.
Bharat Sanchar Nigam Limited has a vast reservoir of highly skilled and
experienced work force of about 2, 85,749 personnel in India and 449 employees in
Salem SSA and the HR functions of BSNL, Salem SSA include.
a) Leadership Facilitation and Support
Leadership facilitation and support does exist in BSNL, Salem. In most of the
cases, the supervisor is friendly and can be approached easily and they provide new
ideas and new methods to overcome the problems and all this rely directly on the
individual capacity / calibre of the supervisor. However, the success and the ability of
a True Leader (Supervisor) lies entirely on his/her individual characteristics and
charisma. The researcher interacted with top executives of BSNL and got confirmed
that the executives undergo many management training, counseling, negotiating skill
development programmes so as to enable them to lead their workforce under them.
We observe the following to become true in the organization.
“Leadership is influence, the ability of one person to influence others”
(Sanders, 1980)
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The primary goal of a leader is to produce more leaders. “The substance of
the leader‟s job is to produce more leaders, not more followers”. The ultimate
measure of leadership success is whether “the organization and the followers grow”
(Fairholm, 1997).
George Litwin and Robert Stringer first wrote up their ground-breaking
research on organizational climate in 1968. They demonstrated that certain leadership
styles produce a positive and stable organizational climate that makes an impact on
motivation and performance.
b) Management Effectiveness
An Organisation should be run effectively by the management in order to deal
with any eventualities during the process of its operation. Management tries to be
more effective by defining the job role, goals of the executives in an exhaustive way.
Every task is planned only to succeed and the management expects a greater role of
the executives in doing so. However, meticulous implementation and follow-up lead
to the stage where the task becomes a successful project. Hence, the effectiveness of
the management depends entirely on the proper functioning of the equipments and on
the sincerity of the executives, which is an open secret. The company had issued
periodical guidelines, work rules, circulars on business and staff role related matters
and conduct periodical revision, review and follow up measures.
c) Organisational Support and Work Environment
The work environment in BSNL is very safe as it reduces job pressure in most
of the cases. As being a PSU, establishment of job environment as available in other
MNC / Corporate sector is highly impossible and hence a balance in job nature is
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maintained to offload the unnecessary work load. Many plans are formulated for
executives (self & family) in detail and it gets diluted in the implementation stage,
leading to loss of good will among the executives and non executives. Also, this may
lead to create a bad image for the organization/superiors and BSNL as a whole.
Hence, it is found that a damage control exercise is initiated to rectify the mistake
committed and to regain the lost glory.
d) Power Conflict and Ambiguity
Power politics does exist in BSNL and is in a controlled stage .The
manipulation of the situation by the executives for their personal advantages are
tackled effectively. Ambiguity of job role does not exist in BSNL as the job
responsibilities and job roles of the executives are clearly defined. However,
variation in the job role and work nature changes dynamically for certain executives
working in particular sections due to the field requirements. The normal job activities
are sometimes hampered by adherence to excessive rules and regulations, which has
to be avoided to make the organization an effective one.
e) Job variety, Challenge and Autonomy
The job role of the executives is clearly defined to each individual and they are
encouraged to try different things in their respective sections. This leads to
development of skills / competence/knowledge by executives in their respective fields
of proficiency and can be termed as job variety. However, this situation is not
applicable to all the sections of BSNL as most of the sections are having fixed or
routine job schedule.
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f) Workgroup Cooperation, Friendliness and Warmth
The atmosphere prevailing in many work groups/sections depends purely on
the individual character/charisma of the superior and his / her rapport with the
subordinates in that particular section. An able and good supervisor sets an example
by creating warmth and friendliness in organization, which leads to better work group
cooperation and a winning formula for their sections. However, the effectiveness of
cooperation, friendliness and warmth in a workgroup depends entirely on the
individuals and collectively on the section.
g) Creativity and Innovation
Creativity and Innovation help an organization to withstand competition and to
maintain a sustainable growth. The platform for exhibiting one‟s own creativity
exists only in certain sections, where it is required to do so. Executives working in
such special/elite sections have the advantage over other executives in implementing
the new ideas and innovative thoughts. Hence, it can be concluded that executives in
normal routine work sections can also be migrated at regular intervals to innovative
elite sections to have a taste of creativity and innovation in their job role.
h) Communication
Communication is the method of conveying information from one place to
another place (or) from one person to another person in BSNL. It is a widely agreed
fact that communication barrier exists in the organization. Normally, the message
related to the personal benefits / promotions / transfers / trainings / miscellaneous
matters of the concerned executive section or department is received in advance
through SMS / Phone and the proper communication will be received in due course.
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Another method of proper communication practice in BSNL will be sending of letters
through departmental proper channels and receiving in the same way. Moreover,
executives are free to express their suggestions/responses to the superiors through the
available modes of communication viz. E-mail / SMS / Letter or Circulars. Regular
business purpose meetings are also held as and when required to communicate with
employees.
i) Training
To meet the technological challenges, employees are trained for technology
up-gradation, modernization, computerization etc., in BSNL's training centers spread
over across country. These centers are properly equipped with the requisite
infrastructure facilities such as lecture rooms, modern audio-visual aids, libraries,
hostels etc.
The two apex training centers of BSNL i.e., Advance Level Telecom Training
Center (ALTTC) at Ghaziabad and Bharat Ratna Bhimrao Telecom Training Center at
Jabalpur are comparable to any world class Telecom Training Center. Moreover; 43
zonal training centers and a National Academy of Telecom Finance and Management
at Hyderabad have been running for several years from now.
Different curriculum of these centers imparts technology based training,
training for attitudinal change, basic educational and skill development programs etc.
The training needs of entire executives of BSNL (all over India) is managed by the
Training centre having the central headquarters at Jabalpur (MP). This institute
designs and schedules the courses for imparting training to both new recruits as well
as existing executives. For the sake of convenience of the executives, one Regional
Training Centre each at Circle (state) headquarters is established and training is
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imparted accordingly to the executives from that circle. In addition, one advanced
level training centre is established at Ghaziabad (UP) to impart training in
latest/emerging technologies to all the executives.
j) Recruitment
Recruitment in BSNL is done in the following methods
Direct recruitment of JTOs and Promotion of JTOs to higher cadres.
Direct recruitment for the post of JTOs (Junior Telecom Officer to Executive
cadre) is through competitive written examination conducted by BSNL New Delhi on
all India basis on a single day. The higher cadres viz., SDE, DE, DGM cadres are the
promotion cadres from JTO and no other cadre is directly recruited other than JTOs.
Direct recruitment for the post of TTAs (Telecom Technical Assistant-Non
Executive cadre) is through competitive written exam conducted by BSNL at Circle /
SSA basis on a single day.
The further cadres viz. SDE, DE, DGM cadres are promotion cadres from
TTA / JTO, no other cadre is directly recruited other than TTAs / JTOs.
The above said examinations are conducted as and when any vacancy /
requirement arises and not conducted periodically.
k) Career Opportunity
Plenty of growth is available for the executives in BSNL leading to a bright
future. BSNL conducts departmental competitive examinations (whenever vacancy
arises) and wide publicity is given to the executives to take up the said examination.
Also, superiors encourage their subordinates to attempt the departmental competitive
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examinations to achieve higher goals of the individuals. Regular coaching classes are
conducted by the experienced / talented executives in the office during weekends /
evening hours for the benefit of the probable candidates, who are writing the
examination. Competitive examination guide / technical manuals are prepared by the
experts in the department / executive trade unions and circulated to the candidates.
Also, executives are encouraged to take up higher studies in their respective field of
proficiency. The executives are provided with cash assistance for the academic
course being studied by them. Hence, a lot of opportunity for growth in career exists
in BSNL and it is left with the individual executive to utilize the same effectively.
l) Promotion
Promotion in BSNL is broadly divided into two categories:
1) Post based Promotion
2) Time bound Promotion
1) Post based Promotion
This is implemented whenever vacancies arise in SDE/DE cadres due to
retirements/promotions from previous cadres on all India basis. The corporate office
at New Delhi decides on the number of posts (based on the report from circles) for
promotion. The process involves short listing of probable candidates among the
executives based on seniority, fitness, attendance conditions and performance, by
scrutinizing the candidates‟ details and issuing of promotion orders. In addition 25 per
cent of the above said promotions are filled up through limited departmental
competitive examination among eligible candidates.
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2) Time bound Promotion
This is implemented once in 5 years irrespective of the availability of
vacancies. Promotion committee is formed every year and eligible executives are
placed in next immediate higher pay scale (without change of designation/job profile).
The process involves short listing of probable candidates among the executives based
on attendance conditions, performance and scrutinizing the candidates‟ details and
issuing of time bound promotion orders.
m) Rewards and Recognitions
Awards are presented to executives on SSA / Circle / All India basis based on
their performance. An award committee is formed every year at each level (SSA /
Circle / all India) and probable candidates are shortlisted for the award. The selection
of the executives for the award is based on performance, any additional (or) special
task accomplished and other related factors as applicable for the corresponding year.
The executives selected for the all India award are presented with the award on 17th
May, every year at New Delhi (17th may is International Telecommunication Day) by
Honorable Minister. The SSA and Circle award winners are presented with the award
at District and State Head quarters respectively at the same time. Each award carries a
citation and a cash award.
n) Motivation
The job of a manager in the workplace is to get things done through
employees. To do this the manager should be able to motivate employees. Motivation
practice and theory are difficult subjects, touching on several disciplines.
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In spite of enormous research, basic as well as applied, the subject of
motivation is not clearly understood and more often than not poorly practiced. To
understand motivation one must understand human nature itself. And there lies the
problem! BSNL Provides following motivational packages to its employees; they
have free telephone facility, Promotion, Transfer, Time to time revision of pay scale,
Central government par facility, Quarters and Good working environment. There is
award / reward system and letter of appreciation for good work done by employees.
o) Grievance Redressal and Staff Suggestion Scheme
Grievance redressal mechanism is implemented as available in all other
Government PSUs. The executives have before them a clearly formulated method of
reporting their grievances to the next higher level authorities through proper channel.
The staff grievance redressal committee analyses grievance report received and
accordingly a genuine solution is arrived. In this way the employee grievances are
addressed amicably. Moreover, a separate Women‟s wing is established in each SSA
for addressing exclusively the grievances of female executives .There is a system to
offer staff suggestion scheme.
p) Trade Unionism and Participative Management System in BSNL
The Trade Union practice in BSNL is followed as available in all other
Government run PSUs. The Trade Unions are broadly classified as follows:-
1) Non-Executive Trade Unions
2) Executive Trade Unions
As per labour and industrial law regulations, membership verification election
has to be held once in two years to elect the majority represented trade union. The
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elections are held at SSA/Circle/all India basis on a single day and the polled votes
are counted as per prevailing rules. The representatives of the victorious Trade Union
are allowed all the permissible benefits, affiliations and permitted to represent the
grievances of the non-executive/executive employees to the Top Management. As the
absorption process of non-executives is already completed, the election for the non-
executive trade unions are being held regularly (once in TWO years) and the union
viz., BSNLEU (BSNL Employees Union) emerged victorious in the last elections
held in February 2011.
As the absorption process of the executives is not yet completed, the elections
for the same could not be held. As of now, the four major executive trade unions viz.,
SNEA, AIBSNLOA, AIBSNLEA, and AIGETOA are representing the grievances of
their respective executive employees of BSNL to the top management.
Representatives of majority trade unions (executive and Nonexecutive cadre) and all
recognized trade unions are members of Joint Coordination Meeting (JCM). This
JCM will have frequent interactions with BSNL top management on important of
matters and day today affairs of BSNL.
q) Perks, Loans and Advances to Staff
Perks are being paid to the executives apart from their regular pay and
allowances for specific recreation / enhancement purpose and also to boost the
employee morale. The type of various perks being paid to the executives include,
1) Professional upgradation allowance to upgrade their professional skills,
2) Food allowance to meet out their food requirements while in office,
3) Transport allowance for commuting from home to office and back,
4) Medical allowance to foot the bill of out-patient hospital treatments,
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5) Complete Hospital bill payment for undergoing surgery / check-ups, etc.,
and also for undergoing in-patient treatment in select hospitals,
6) Reimbursement of newspaper bill purchased in the residence,
7) Festival allowance,
8) House building advance,
9) Motor car advance,
10) Personal computer advance and
11) Leave travel concession
Apart from the above said allowances there are some special allowances like
Special compensatory remote locality allowance, Special compensatory bad climate
allowance, scheduled / tribal area allowance, Island special duty allowance, hard area
allowance and Rural duty allowance.
r) Pension and Retirement Benefits and Gratuity in BSNL
The following are the different kinds of Pension that are in vogue in BSNL
1) Superannuation pension
2) Retiring Pension
3) Invalid Pension
4) Compensation Pension
5) Compulsory Retirement Pension
6) Compassionate allowance
7) Voluntary retirement Pension
Commutation of pension can be done to the maximum of 40 per cent of
pension that can be commuted with or without medical certificate and a lump sum in
lieu then of can be obtained. Apart from this family pension, enhanced family pension
and family pension to family of missing employees are also provided.
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Service gratuity, retirement gratuity and death gratuity is granted to
employees.
s) Miscellaneous Facilities in BSNL
Staff cooperative society is functioning since its inception in 2000 with head
quarters at Chennai. Once the employee gets enrolled ,subscription fee has to be paid
by employees towards the society membership and all facilities like loans, advances
and exgratia are extended to members. The society is functioning well and employees
are happy about its performance.
Staff clubs and canteen are established at each and every telephone exchanges
for the benefits of the employees. Thus by profiling the existing organizational
climate dimensions, the researcher achieves the realization of the first research
objective namely, To Study the existing Organisational climate and dimensions led
by present HRM practices.This Objective achievement also paved way for
standardizing the questionnaire used in the study.