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Mobile Handset Industry In India. Essay

1256 words - 5 pages

Communication has come a long way from the sign language used by prehistoric man to the modern ways like e-mail, cellular phones, etc. This evolution, which was not an overnight process, saw the development of languages, written script, development of postal services, invention of telephones and internet, etc. Invention of the telephone in 1876 by Graham Bell changed the way man communicated to long distances. Instead of the snail mails, man began using telephones which transmitted the messages instantaneously and also to the correct person as well as get a reply at the same instant. With its growth in popularity, many new innovations were added to the basic telephone, one of which is the cell phone, which has become a near necessity for all those on the move. Due to its simplicity and convenience it has became an instant hit.Cellular Phones represent the best of modern wireless technology and are one of the best popular tools of the early twenty first century facilitating business, recreation and vital emergency communication. It has ceased to be a luxury as more people are realizing its advantages. Hence, it will not be surprising when in the near future the number of landline telephone owners is less than the number of cell phone users.Due to the ever growing demand for cell phones in India, mobile handset industry has broken all records and achieved a growth of 568% in value terms. This unprecedented growth has been due to a variety of reasons like opening up of markets for foreign companies, providing operating licenses to numerous service providers, etc. As a result of which, the Indian mobile handset industry has recorded a turnover of Rs 8,344 crore from a measly Rs 1,250 crore in the FY (Financial Year) 2002-03. While comparing the GSM and CDMA markets, we find the former to be leading by a narrow margin of around Rs 38 crore. In FY 2003-04, the GSM market contributed around Rs 4,191 crore, registering a growth of 476% from Rs 727 crore in FY 2002-03. The CDMA registered a growth of 694%, which was estimated at around Rs 4,153 crore in FY 2003-04, from Rs 523 crore in 2002-03.The main stimulant for this growth was the drastic cut in prices by service providers. With duty reduced to four percent, the cost of handsets has gone down significantly in calendar year 2004, thereby driving volumes in the last quarter of Jan'04 to Mar'04. Almost all telecom giants are present in India viz., NOKIA, MOTOROLA, SONY ERICSSON, SAMSUNG, LG, SAGEM, KYOCERA, etc. Moreover, in the last fiscal, Chinese and Taiwanese players have also entered the Indian market and so the market has become very competitive. On the GSM side around 20 companies are present in India whereas on CDMA it is around 10 companies. On the CDMA side, all the major players have launched their handset in the Indian market. In the last fiscal there were two new entrants-Nokia and Motorola-and they are giving some fight to established players like LG and Samsung. On the GSM side, LG has...

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