A study on consumer behaviour of hathway broadband services, bangalore

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. Buoyed by the rapid surge in the subscriber base, huge investments are being made into this industry.

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  The Russian government is likely to pick up equity amounting to US$ 670 million-US$ 700 million in Sistema Shyam Tele Services Ltd (SSTL), a joint venture between Russia-based telecom major Sistema and Shyam Group in India, by the end of this financial year. SSTL is also planning to invest US$ 5.5 billion over the next 5 years in India.
  
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  Norway-based telecom operator Telenor has bought a 60 per cent stake in Unitech Wireless for US$ 1.23 billion.
  
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  Japanese telecom major NTT DoCoMo acquired a 27.31 per cent equity capital of Tata Teleservices for about US$ 2.6 billion in November 2008.
  
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  Bahrain's Batelco has signed a deal to buy 49 per cent in Chennai-based S-Tel, a GSM service provider, for US$ 225 million.
  
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  BSNL, India's leading telecom company in revenue terms, will put in about US$ 1.16 billion in its WiMax project.
  
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  Vodafone Essar will invest US$ 6 billion over the next three years in a bid to increase its mobile subscriber base from 40 million at present to over 100 million.
  
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  Telecom operator Aircel, which launched GSM mobile services in Bangalore in February 2009, plans to invest US$ 220.58 million over the next year to set up base stations across the state.
  

One of the most frequent definitions that prevail in the telecom circles for number portability is: "Number portability is a circuit-switch telecommunications network feature that enables end users to retain their telephone numbers when changing service providers, service types, and or locations."

Why mobile number portability (MNP)? When fully implemented nationwide by both wire line and wireless providers, portability will remove one of the most significant deterrents to changing service, providing unprecedented convenience for consumers and encouraging unrestrained competition in the telecommunications industry. In short, this is the best method to increase the efficiency of the service provider by increasing the competition, thereby ensuring better services in all respects.

From the subscribers’ perspective, this is a deceptively simple and very welcome change, because they can change wireless service providers without worrying about notifying friends, family and business contacts that their wireless number is changing. In addition, being able to ‘port’ a number from one provider to another eliminates the hassle and expenses of changing business cards, stationery, invoices and other materials for businesses.

From the wireless carrier’s perspective the change is anything, but simple. Virtually all of wireless carriers’ systems are affected. Especially any system that relies on mobile identity numbers (MINs) or mobile directory numbers (MDNs) will be affected. Examples of critical systems and processes that would be affected are: billing, customer service, order activation, call delivery, roamer registration and support, short messages service center, directory assistance, caller ID, calling name presentation, switches, maintenance and CSC systems, home location registers (HLRs), and visiting location registers (VLRs).

INDUSTRY UPDATES

Consolidation in Industry

Telecom players are looking to tap into global funds to finance their aggressive growth plans. This will result in partnerships joint ventures and equity sellout to foreign players. New license holders will continue to look to sell their stake at a premium. New policies will seek to curb this license arbitrage. Smaller players with operations in only a few circles will find in difficult to compete with the nationwide players. The industry may see consolidation with these smaller operators being acquired by the larger ones. “Unbundling of the corporation” will continue as companies will seek f or economies of scale and lower startup cost by infrastructure sharing. 3G and WiMax license will spur M&A and partnership activity.

There were three transactions as part of this acquisition; acquisition of shares of Spice, a non-compete fee and a capital infusion of about Rs 7300 crores received from TM International Bhd (TMI). With respect to shares, Idea acquired 40.8% stake of Spice Communications at Rs 77.30 a share for Rs 2,716 crore. There was a share swap in which Spice shareholders got 49 Idea shares for every 100 Spice shares held. An additional Rs 544 crore was paid to the promoters of Spice group as 'non-compete fee'. The deal was strategically important for Idea Cellular as it was looking forward to transfer itself into a pan-India telecom service provider. The spectrum auctioned by GoI is a scarce resource nowadays and cost a premium. Also there’s restriction by TRAI with respect to number of operators per telecom circle. So it makes sense to acquire a small telecom operator. Small players like Spice Telecom operating at only a few circles(Karnataka and Punjab) will find difficult to compete with the nationwide players in the long run. So it was a win-win deal for both companies.

Vodafone paid a discounted price of $10.9 billion in cash for acquiring the 52% stake held by Hutchison Telecom International (HTIL) in Indian mobile firm Hutch-Essar. HTIL declared a special dividend of 6.75 HK dollars per share following the completion of the formalities. The final price was a reduction of $180 million from the originally agreed price of $11.08 billion. Vodafone is the largest mobile telecommunications network company in the world. The deal gave them access to one of the fastest growing mobile markets in the world.

Norwegian Telecom major Telenor is in the process of acquiring controlling stake of 67.25% in Unitech wireless via equity infusion. The enterprise valuation of Unitech Wirelsss is about Rs 10,900 crore. As per the deal, Telenor will infuse cash in four stages and at each phase, by increasing its stake in Unitech Wireless. In the first phase, they got 33.5% ownership in Unitech Wireless. In the second phase they completed the acquisition for a 49 per cent stake in Unitech Wireless by paying Rs 1,130 crore for a further 15.5 per cent stake in the company. The acquisition is expected to be completed by end of this quarter.

Japanese carrier NTT DoCoMo acquired 26 per cent stake in Tata Teleservices (TTSL). The Tata DoCoMo-branded GSM service has already started in Southern India and gradually will be expanded nationwide. DoCoMo’s international expansion plans have not always proven successful, with the firm historically preferring to take small stakes in firms and then try to influence their strategy. It has been less prepared to take majority stakes and impose its will, as other leading carriers have chosen to do.

The difficulties faced by the firm in spreading its domestically successful i-mode service internationally typify the obstacles it has faced overseas. WithTata, DoCoMo had said “participating proactively in TTSL’s management by providing human resources and technical assistance to help realise improved network quality and the possible introduction of leading-edge, value-added services.”

Bharti-MTN deal (in talks).

Recently Bharti Airtel has re-started its audacious merger bid with MTN that could create a $61-billion transnational telecom goliath with combined revenues of $20 billion and over 200 million subscribers across Africa, Asia and Middle East, will be among the world's 10 biggest telecom companies. The deal could be win-win for both parties. Bharti is under pressure in its home country due to severe competition and looking forward to spread its risk across geographies. Meanwhile, the African telecom operator is also encountering some of the problems that its counterpart in India is confronting. MTN may have higher ARPUs (in the range of $12-20), but they are also falling fast.

In this section we have listed down the future technologies which are in roadmap and are speculated to make an impact on current business model of telcos.

IP Multimedia Subsystem (IMS) is a generic architecture for offering multimedia and voice over IP services, defined by 3rd Generation Partnership Project (3GPP). IMS is access independent as it supports multiple access types including GSM, WCDMA, CDMA2000, WLAN, Wire line broadband and other packet data applications. IMS will make Internet technologies, such as web browsing, e-mail, instant messaging and video conferencing available to everyone from any location. It is also intended to allow operators to introduce new services, such as web browsing, WAP and MMS, at the top level of their packet-switched networks. IP Multimedia Subsystem is standardized reference architecture. IMS consists of session control, connection control and an applications services framework along with subscriber and services data. It enables new converged voice and data services, while allowing for the interoperability of these converged services between internet and cellular subscribers. IMS uses open standard IP protocols, defined by the IETF. So users will be able to execute all their services when roaming as well as from their home networks. So, a multimedia session between two IMS users, between an IMS user and a user on the Internet, and between two users on the Internet is established using exactly the same protocol. Moreover, the interfaces for service developers are also based on IP protocols. Some of the possible applications where IMS can be used are:

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  Presence services
  
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  Full Duplex Video Telephony
  
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  Instant messaging
  
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  Unified messaging
  
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  Multimedia advertising
  
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  Multiparty gaming
  
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  Video streaming
  
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  Web/Audio/Video Conferencing
  
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  Push-to services, such as push-to-talk, push-to-view, push-to-video
  

4G or Fourth Generation is future technology for mobile and wireless communications. It will be the successor for the 3Rd Generation (3G) network technology. Currently 3G networks are under deployment. Approximately 4G deployments are expected to be seen around 2010 to 2015. The basic voice was the driver for second-generation mobile and has been a considerable success. Currently , video and TV services are driving forward third generation (3G) deployment. And in the future, low cost, high speed data will drive forward the fourth generation (4G) as short-range communication emerges. Service and application ubiquity, with a high degree of personalization and synchronization between various user appliances, will be another driver. At the same time, it is probable that the radio access network will evolve from a centralized architecture to a distributed one. The evolution from 3G to 4G will be driven by services that offer better quality (e.g. multimedia, video and sound) thanks to greater bandwidth, more sophistication in the association of a large quantity of information, and improved personalization. Convergence with other network (enterprise, fixed) services will come about through the high session data rate. It will require an always-on connection and a revenue model based on a fixed monthly fee. The impact on network capacity is expected to be significant. Machine-to-machine transmission will involve two basic equipment types: sensors (which measure parameters) and tags (which are generally read/write equipment). It is expected that users will require high data rates, similar to those on fixed networks, for data and streaming applications. Mobile terminal usage (laptops, Personal digital assistants, hand helds) is expected to grow rapidly as they become more user friendly. Fluid high quality video and network reactivity are important user requirements. Key infrastructure design requirements include: fast response, high session rate, high capacity, low user charges, rapid return on investment for operators, investment that is in line with the growth in demand, and simple autonomous terminals. The infrastructure will be much more distributed than in current deployments, facilitating the introduction of a new source of local traffic: machine-to-machine.

Hathway is a major cable television service operator in India that is based in Mumbai. It has large operations in many cities, including Hyderabad, Mumbai, Pune and Bangalore. It has diversified into providing internet via cable and was one of the first to do so in Chennai. In India, it was the first company to provide internet using the CATV network. The company has a 51 percent stake in Divya Bhasker's Bhasker Multinet and in Gujarat Telelinks P L. This gives it a strong position in Gujarat CATV. In 2006, Hathway launched first cable operator to launch a digital platform in India.

Consumer behavior is the study of how people buy, what they buy, when they buy and why they buy. It blends elements from psychology, sociology, socio-psychology, anthropology and economics. It attempts to understand the buyer decision-making process, both individually and in groups. It studies characteristics of individual consumers such as demographics, psychographics, and behavioral variables in an attempt to understand people's wants. It also tries to assess influences on the consumer from groups such as family, friends, reference groups, and society in general.

Problem recognition results when there is a difference between one's desired state and one's actual state. Consumers are motivated to address this discrepancy and therefore they commence the buying process.
OBJECTIVES OF THE STUDY

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  The objective of the study is to understand the consumer’ pre, post, during perception of broadband connection and consumer buying behaviour and attitude for Hathway Broadband services.
  
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  To Analyzing the satisfaction level of customers towards Hathway Broadband service.
  
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  To find out the consumer awareness and also creating an Awareness to customers about the facilities in broadband connections and its new products.
  
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  To find out best sales promotional technique.
  
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  To find out consumer needs and expectations.
  
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  To understand the needs of different consumer segments.
  

This study includes Consumers response and awareness towards the brand, products and services of Hathway Broadband. The results are limited by the sample size 100 numbers and therefore the opinion of only selected customers is taken into consideration. Mainly this study is conducted in Bangalore and the scope is limited.

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   Consumer- A Consumer is a broad label for any individuals or households that use goods and services generated within the economy.
   
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   Consumer Behaviour- It is the study of when, why, how, and where people do or do not buy a product.
   
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   Respondents- A person who replies to something, esp. one supplying information for a survey or questionnaire or responding to an advertisement.
   
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   Objective- An end that can be reasonably achieved within an expected timeframe and with available resources.
   
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   Broadband- The term broadband refers to a telecommunications signal of greater bandwidth, in some sense, than another standard or usual signal.
   
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   Service- A service is the intangible equivalent of an economic good.
   

The research will be carried out in various phases that constitute an approach of working from whole to part. It includes subsequent phases trying to go deeper into the user’s psyche and develop a thorough understanding of what a user looks for while buying a broadband service.

The first phase is completely internal where it is stormed over the most effective route of action, considering that Hathway users in Bangalore are more in number.

The second phase is with some respondents who will be interviewed with the help of questionnaire keeping in mind the time and cost constraints.

The information relevant for study was drawn from Primary data collected through survey method, which alone was not sufficient. Hence Secondary data was collected to study successfully.

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  Primary data- In order to find out customer satisfaction regarding bikes of Royal Enfield Primary Data was collected by personally visiting the dealerships and showrooms. With the help of a well laid questionnaire, I took the feedback from the customers who were coming for the services of their broadband. As well as i contacted some of the customers through tele calling by taking the data about the customers from the customer data register of the dealership. I interviewed them and discussed with the employees at Hathway which helped me to prepare the research Report.
  
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  Secondary data- The Secondary Data collection involved internet search, browsing magazines, newspapers and articles and papers related to the two wheeler industry in India. Numerous Journals and books related to the topic were also browsed to understand the dynamics of the industry.
  

The research was carried out in various phases that constituted an approach of working from whole to part. It included subsequent phases trying to go deeper into the user’s psyche and develop a thorough understanding of what an user looks for while buying a broadband service.

For the consumer behviour study a sample of 100 persons was chosen from the Bangalore city. The sample was judgmental and methodology was random sampling.

Size of Sample	100
Sampling technique	Convenient Sampling method or Random Sampling
Location from which samples were taken	Bangalore city

Plan of Analysis

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  Raw Primary data has been collected with help of questionnaire. The raw data has been tabulated with the help of table. From the tables, concept, analysis and inferences are drawn which in turn was used for interpretation. Based on, these charts were prepared to better pictorial understanding of the study.
  
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  From the set of inferences and interpretation, conclusion have been drawn which is followed by suggestions, keeping the objectives in mind throughout the study.
  

Although all efforts were taken to make the result of survey as accurate as possible the survey had the following constraints:

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  Customers were not willing to give answers of the questions due to their busy schedules.
  

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  Few customers were not cooperating during the project survey. It was quite difficult to collect necessary data.
  
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  Due to the time constraint and other imperative workload during the training period it could not be made possible to explore more areas of concern pertaining to project study.
  
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  The survey was carried out in some parts of Bangalore city, hence it doesn’t reflect the entire market scenario DEL and DSL.
  
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  This study is based on the prevailing customer’s satisfaction. But the customer’s satisfaction may change according to time, fashion, technology, development, etc.
  
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  As per the population of the study is huge, the researcher has taken only 100 sample respondents.
  

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  Method of data collection was through personal interview and therefore bias becomes a major limitation.
  
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  Owing to their pre occupation some customers were unable to answer the complete questionnaire.
  
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  Majority of the customer were too aggressive in nature.
  

Competition from emerging digital direct-to-home or “DTH” satellite pay-TV networks, which have grown in scale over the past five years is another key trend in the Indian cable television industry. Concurrently, due to continued growth of the national economy in real terms and rising household incomes resulting in further enhanced affordability, there is increasing consumer demand for more entertainment and information services from television distribution networks and communications platforms. To benefit from this demand upswing, incumbent cable operators are investing to upgrade existing distribution infrastructure and technology by quickening the deployment of digital set top boxes, consolidating last mile networks and offering new broadband and interactive services. This gradual structural transformation is similar to what has already been witnessed in

developed markets such as USA and Europe.

Internet services in India started with dial up access, where speeds were limited to approximately 56 kbps. However, due to the growing popularity of certain high bandwidth internet applications, such as internet telephony (introduced on April

2002), music and video download as well as online gaming, internet services providers (“ISPs”) started providing “always on” high speed internet access with speeds starting from 64kbps. The Government recognizes that deeper penetration of broadband and Internet is essential and will be the catalyst for economic growth and modernization. India has approximately 16.18 million internet households. Internet subscribers have grown at the average rate of 25 % per annum over the last

five years. However, the total internet penetration in India is low and represents less than 7 % of all households and this offers significant growth potential. As per TRAI report broadband internet subscribers at 8.77 million comprise 54.2% of internet subscribers on 31st March 2010.
BUSINESS OVERVIEW

We are the leading cable television services provider in India, as well as one of the leading cable broadband services providers. We offer cable television services across 125 cities and towns and high-speed cable broadband services across 18 cities. We have won a number of awards for our cable television services such as being named “Best cable operator of the year” by the Indian Telly Awards in six out of the last seven years. Our Company has established 19 digital head-ends in the country.

We hold a pan-India ISP license and were the first cable television services provider to offer broadband internet services. We are currently India’s largest cable broadband services provider, with approximately 1 million two-way broadband enabled homes passes, as on March 31, 2010. As of March 31, 2010, our subscriber base constituted approximately 52 % of the total cable broadband market in India.

In addition to our cable television and broadband service offerings, we also generate advertising and airtime revenue from advertisements aired for and on behalf of channels owned by third parties, such as the Hindi movie channel, Cine Channel, and the music channel, I TV.