WORLD ELECTRONICS FORIUM

Indian Opportunities in ICTPresentation

ByN K GOYAL

President, CMAI Association of India, CMAIChairman Emeritus, TEMA

Director, National Fertilizers Ltd. ( Government of India Undertaking)

nkgoyals@yahoo.co.in 98 111 29879

www.cmai.asia

14-17th November, 2009

Telecom in Asia Asia is a region of superlatives in the ICT arena

with over two billion telephones, including 1.4 billion mobile subscribers, and 42 per cent of the world’s Internet users

Asia is also the world’s largest broadband market with a 39 per cent share of the world’s total at the end of 2007.

(ITU’s 2008 Asia Pacific Telecommunications and ICT Indicators Report)

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Advantage India At $ 1.15 Tr India is the third largest consumer on PPP basis. India ranks better than China and Vietnam on the Index of

Economic Freedom although it is lower than the world average as awarded by The Heritage Foundation and WALL STREET JOURNAL.

India scores higher than China and Vietnam on “World Rankings property rights”, which describes the protection of property and intellectual property rights

India has a score of 38 on “economic measure of income inequality” better than China (47) US (45) Japan(38) but poorer to UK (34). Shows equal distribution of wealth.

The annual supply of science and engineering graduates is higher than China and other developed countries

Over 2.3 million graduates and 0.7 million post-graduates each year

2nd largest pool of scientists/ engineers in the world Highest number of qualified engineers, second on trained

doctors 389 universities, 14,169 colleges, 1,500 research institutions

India’s Electronics Potential Current India market size about US $ 34 Bill. out of which production

$16.1 Bill. Ranked 26th in the world in sales, 29th in production Demand growing 25% CAGR, from 4% of GDP to 12% by 2015 i.e..

320 Bill. Total production may go up to $ 150 Bill. with employment potential of 21 mill.

Indian ICT spending is expected to grow at 19% from $ 29.5 Bill. During 2004 to $54.8 Bill by 2008

Consumer Electronics (CE) is the largest segment of the Electronics sector. It contributes 33% to the Electronics production in the Country. The total production of Consumer Electronics is estimated $5625 million during 2007-08 registering a growth of 12.5%

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Opportunities in Indian ICT Sector 63.5 million telecom subscribers in rural India 2nd largest and fastest growing wireless market in the

world Average addition of 15 million telecom connections every month

India to have 13 million WiMAX subscribers by 2010 Mobile gaming market expected to reach US$250 million

by 2010 at an annualized growth rate of 106% Indian IT market is projected to grow to US$25bn by 2013 Network security market to grow at CAGR of 17.6% till

2013 89.1 million IPTV subscribers by 2012 Demand for set-top boxes expected to grow upto 60

million by 2015 Total Pay-TV subscribers to grow from 73 million to 137

million by 2012

Electronic Components Consumption of electronics equipment in India

will be $363 bn. by 2015. (Frost & Sullivan)

India has the potential to manufacture electronics equipments worth $155 bn by 2015.

Most of this growth is expected to come from manufacturing of information and communication technology products, and office automation.

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BELL’S TELEPHONE Alexander Graham Bell, keenly interested in the

education of deaf people, invented the microphone and in 1876 his "electrical speech machine," ie today’s telephone. Bell set up the first telephone exchange in New Haven, Connecticut in 1878. By 1884, long distance connections were made between Boston, Massachusetts and New York City.

Since his death in 1922, the telecommunication industry has undergone an amazing revolution. Today, non-hearing people are able to use a special display telephone to communicate.

Bell's "electrical speech machine" paved the way for the Information Superhighway. Fiber Optics are improving the quality and speed of data transmission.

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Indian Telecom World’s fastest Growing Telecom Market – 10-15 Million plus

subscriber addition per month Second largest in the world after China 509 Mn. subscribers, 475 wireless 281 state-of-the art Networks (GSM+CDMA) 24 National Long Distance & 19 ILD Licensees Lowest tariff but highest profitability. Lowest Call Rates in the World India ranks highest in Mobile monthly Minutes of Usages per

subscriber in Asia Pacific Region and second to USA in the world….500 minutes per month

Innovative approach of doing business at lowest operation costs.

Innovative value added concepts…missed calls, rural applications, lowest prepaid charge, per second billing

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CONTINUED WIRELESS GROWTH EXPECTED DUE TO

Booming economy, rising income, increasing available disposable surplus

Continued big demand, rural potential Introduction of Number Portability by mid 2009 New Operators bringing in competition, spread and

cheaper tariffs Introduction of 3G, Wimax technologies Operators allowed intra service roaming Operators scouting cheaper handsets eg. Spice with IDH

Media Tek, Taiwan for $15 handest. Also no screen sets being considered.

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Opportunities Ahead

World’s second largest market after China, growing highest per month.

3G & Broadband wireless Auctions to start shortly MVNO to be allowed shortly ISPs, NLD, ILD licenses available FDI 74% in operations and 100% fro manufacturing Rural Telecom, Broadband, VAS market New Innovative services, Mobile payments, location based

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Telecom challenges worldwide

Health and environmental concerns resulting in several law suits, myths and alarms.

Consumer concerns on quality, tariff and after sale service issues.

Use of telecom network by terrorists, ant social activities Technology misuse in all sorts of crime ranging from credit card

fraud to data theft to simple defamation. Regulatory means for this and also to avoid unsecured wireless networks.

Increasing awareness of restrictions sought for use of mobiles in schools, public areas, while driving, offices etc. For ex.

New York banning cell phones in schools and Indian Parliament Committee examining need for reasonable restrictions in use of mobile.

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Technology Battles

Telecom is characterized by Hype and Technology debates.

At any given time there must be a live technology debate in telecom era.

The question for network operators is no longer which technology is best--WiMAX or LTE--but which application will compel consumers and enterprises to upgrade to 4G. Will it be video? Or will it just be more bandwidth for the always-on, always-available wireless broadband connection that consumers have come to expect?

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Game of Patents IPR American Society of Composers, Authors & Publishers is

taking it one step further and calling it a violation of copyright law. According to a filing obtained by the Electronic Frontier Foundation (EFF), the performance rights organization has filed suit against AT&T, claiming that every time a musical ring tone goes off in public, the song constitutes a performance and, therefore, violates copyright law.

Both carriers and mobile content providers already pay a licensing fee to songwriters and publishers for each ring tone a consumer downloads, but ASCAP is alleging that additional royalties are owed when these same ring tones publicly perform – i.e. ring in public.

Free….Not so free June, 2009 Verizon paid $ 1.5 Mill. to Florida

State as settlement for third-party charges that appeared on consumers' bills.  The customers were charged for ring tones, wallpapers and other mobile content that had been marketed as free

February,2009 AT&T Mobility refunded thousands of Florida consumers for the same problem. AT&T agreed to pay Florida $2.5 million and contribute $500,000 toward consumer education on safe Internet use.

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Hype v/s reality Internet speed….India Govt. says 256 Kbps,

vendors talk of 2 Mbps….as per TRAI no body even gets 256 Kbps.

We hear faster speed…but what and under what conditions…no body declares

There is no one in the world who knows for sure where we are heading or how we will get there.

Hype: LTE will provide about 50 Mbps data services. Fact: Only in a lab where there is a 20 MHz wide LTE system and there is only one user.

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LTE SPEEDhttp://www.fiercebroadbandwireless.com/story/vodafone-no-lte-europe-2010/2009-07-09?utm_medium=nl&utm_source=internal

Ericsson UK's CTO John Cunliffe, "The technical guys know that advertising those big speeds is

damaging, but they're the numbers the marketing guys want to push,"

"It's difficult, if one company is advertising the maximum speed, for another to then turn around and advertise the likely speed. It's going to need everybody to be honest."

While the technology is theoretically capable of hitting 150 Mbps, Ericsson admits they are unlikely to be replicated in the real world. A company spokesman suggested users could see an improvement of around "10 times over their current experience on a 3.6 Mbps mobile broadband connection."

Cunliffe said Ericsson's road map will see the vendor moving from 150 Mbps to 300 Mbps and then 600 Mbps during the initial phase of LTE. Advanced versions of the technology will exceed 1 Gbps, but that capability is a ways off.

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New Innovations costing others and now self? Almost every week a new application is announced which also

aims to take additional revenue from existing others. And slowly it has started affecting the industry itself. Take example of Mobile VOIP

Mobile VoIP is moving beyond its initial function as a new mechanism to get inexpensive international/local calls.

MVNOs and 3G operators without legacy networks using Mobile VoIP to more cost effectively add voice to data offerings.

While Mobile VoIP still poses a direct threat to operator voice revenue, it also represents a dynamic new capability that promises numerous applications.

Skype and Vonage have influenced users to think of voice as a data application.

As user habits are being shaped by rich on-line communication experiences, mobile carriers control over devices and data applications is waning.

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Security Threats

The speed with which criminals are capitalizing on world events, growing collaboration among cyber criminals and a growing threat from disgruntled former employees.

Less than 24 hours after the news of Michael Jackson’s death first broke, spammers had sent more than 5 billion spam emails, reaching a peak of more than 5% of global spam

The creators of the Conficker worm, which infected an estimated 9 million computers starting late last year, had established an agreement with the makers of the spambot, Waledac, to help monetize each other’s efforts in a partnership of product and distribution.

RIM makers of blackberry says UAE Etisalat issued update during July, 2009 for increasing performance was actually spay ware. It could allow unauthorized access to private information and emails and it reduces drastically battery life.

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SIM Card Security Scheme

Security Accreditation Scheme (SAS), the global programme voluntarily managed by the GSM Association.

Under this certification there are 20 SIM card manufacturers globally accredited by GSMA. There are six are from China.

Yet there is only one SAS-compliant manufacturer

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We talk of Numbers & $ ?

We always listen to big numbers like "12 operators committing deployments in 2010" and "$1 billion R&D investment required to build LTE products" and more are making frequent headlines.

Viewing these numbers in isolation provides only a partial and one-dimensional view of the issues facing the industry and what this means.

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We talk of Speed in Telecom?

JOHANNESBURG South Africa 11-month-old pigeon took one hour and eight minutes to fly the 50 miles from Unlimited IT's offices near Pietermaritzburg to the coastal city of Durban with a data card strapped to its leg.

Including downloading, the transfer took two hours, six minutes and 57 seconds — the time it took for only four percent of the data to be transferred using a line provided by Telkom.

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Cracking GSM Codes The Chaos Computer Club, Germany-based hacking

community with more than 4,000 members, is co-coordinating worldwide efforts to crack the code. They say they are doing so to raise awareness about security flaws in the GSM system. They say governments and organized crime gangs already hack into the GSM network and want to push mobile phone companies to improve security.

In 2007 a reporter from the UK’s News of The World Sunday tabloid and a private investigator were jailed for illegally tapping into the mobile phones of hundreds of high-profile figures in the quest for news stories.

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About CMAI

CMAI is an apex business and trade promotion organization, based in India with MOU partners and representatives spread across over 30 Countries with branch offices in Japan, Korea, Singapore, Taiwan and Malaysia.

CMAI is integrated telecom and IT association covering all verticals.

CMAI is involved in policy formulations with Government and other stake holders for Technology Innovations, Indigenous manufacturing

CMAI is developing scientific knowledge and practical means for protecting human ecology and environment from the harmful effects of environmental hazards like e waste, radiation etc.

CMAI assists manufacturers to maximize competitiveness in the domestic and international markets.

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About CMAI

With CMAI membership, you gain access, authority, and intelligence designed to help you to:

Protect interests when standards and policies are being formulated

Engage peers regularly about market challenges or business opportunities

Access timely news, information, and market intelligence Expand business to overseas markets efficiently and

effectively Gain a competitive advantage through convergence Take the Lead on green initiatives in the ICTE Industry Participate in Indian and global Exhibitions, Seminars,

Workshops

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Where is my cell phone mama..

I want to SMS to God that I have reached safely!

THANKS….

www.cmai.asia+91 98 111 29879

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