Slowly, trying to build a telecom empire, the Tata Group has started its telecom journey at a good pace. The group is present in all the segments and has an edge over others in ILD, network integration, telecom software and enterprise voice solutions, where it is way ahead of its competitors.

The combined turnover of Tata group companies touched Rs 7,961 crore during FY 2002–03, thus making it the largest private sector telecom group in India. The group’s negative 5 percent growth is mainly due to the erosion in VSNL’s revenues. The incumbency factor and the lowering of settlement rates made impact on the top line as well as bottom line of the company. With market share reducing on the voice front, the focus is more on value-added services. The company plans to use Tata Power’s bandwidth for its Mumbai operations and offer MPLS services to corporate customers and carriers. Other new services being planned are voice-over-IP and e-learning.

VSNL also took the international expansion route during the last fiscal, obtaining a gateway operator license to operate international long distance voice and data services in Sri Lanka. Another important development was its entry into the NLD business. Here, VSNL is lagging behind Bharti Group by a year.

On the basic services front, the Tata Group acquired Hughes Tele.com and has consolidated operations in basic services by becoming the number one private operator. With the lucrative Maharashtra circle under its belt, the company now has an advantage over Bharti and BSNL. During the last fiscal, the company also launched services in Delhi, Karnataka, Tamil Nadu, and Gujarat, and also increased its service area from one circle to six circles.

On the cellular services front, group company Idea Cellular is third in terms of revenue and fourth in terms of subscriber base.

Another group company, TCS was the clear leader in telecom software, providing services to many telecom service providers and equipment manufacturers worldover. Tata Telecom exclusively represents Avaya, world’s No. 1 enterprise voice equipment company, and is the top provider of enterprise voice solutions and structured cabling in India. CMC and Tata Infotech are among the best network integrators in the country, with the former’s services being now exported through TCS’ international contacts.

The group began finally tapping the synergies between its various telecom service providers through its Tata Indicom Enterprise Business Unit (TEBU) initiative. Earlier, group companies were targeting the corporates on an individual basis. Now, TEBU will provide total telecom solution by outsourcing services from different Tata Group. This will also help Tata Group to keep intact its top corporate customers and also optimizing its various operations.

This is a good initiative, but it can be further broadened in the future by also obtaining the contributions of the rest of the Tata group companies, which are into telecom equipment, software services and network integration businesses.