Idea Cellular

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Type Industry Founded Headquarters Key people Products Revenue Operating income Net income Total assets Employees Parent Website

Public BSE: 532822 NSE: IDEA Telecommunications 1995 Santacruz East, Mumbai, India[1] Kumar Mangalam Birla
(Chairman)

Mobile 12,447.08 crore (US$2.76 billion) (2010)[2] 1,475.87 crore (US$327.64 million) (2010) 953.94 crore (US$211.77 million) (2010) US$5.334 billion (2010) 6,763 (2010) Aditya Birla Group (49.05%) Axiata Group Berhad (15%) Providence Equity (10.6%) IdeaCellular.com

Idea Cellular, usually referred to as !dea, (BSE: 532822, NSE: IDEA) is a wireless telephony company operating in all the 22 telecom circles in India based in Mumbai. It is the 3rd largest GSM company in India behind Airtel,Vodafone.

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[edit] Inception and growth

In 2000, Tata Cellular was a company providing mobile services in AP. When Birla-AT&T brought Maharashtra and Gujarat to the table, the merger of these two entities was a reality. Thus Birla-Tata-AT&T, popularly known as Batata, was born and was later branded as !dea. Then Idea set sights on RPGs operations in Madhya Pradesh which was successfully acquired, helping Batata have a million subscribers, and the licence to be the fourth operator in Delhi was clinched. In 2004, Idea (the company had by then been rechristened) bought over the Escorts groups Escotel gaining Haryana, Uttar Pradesh (West) and Kerala and licences for three more UP (East), Rajasthan and Himachal Pradesh. By the end of that year, four million Indians were on the companys network. In 2005, AT&T sold its investment in Idea, and the year after Tatas also bid good bye to pursue an independent telecom business. And Idea was left only with one promoter, the AV Birla group. When the companys stock listed on the bourses in March 2007, its subscriber base was 13 million with presence in 11 circles. In less than three years, the subscriber numbers have more than quadrupled. The public issue was oversubscribed 50 times and raised Rs 2,450 crore.In June 2008, Idea Cellular bought out BK Modis stake in Spice Communications for Rs 2,700 crore adding Punjab and Karnataka circles. Modis joint venture partner, Telekom Malaysia, invested Rs 7,000 crore for a 14.99% stake in Idea. Just around then, Ideas subsidiary, Aditya Birla Telecom sold a 20% stake to US-based Providence Equity Partners for over Rs 2,000 crore.

[edit] Customer service

The company has its retail outlets under the "My Idea" banner. The company has also been the first to offer flexible tariff plans for prepaid customers[citation needed]. It also offers GPRS services in urban areas. Idea Cellular won the GSM Association Award for "Best Billing and Customer Care Solution" for 2 consecutive years[citation needed]. IDEA Cellular has been recognized as the 'Most Customer Responsive Company' in the Telecom sector, at the prestigious Avaya GlobalConnect Customer Responsiveness Awards 2010[citation needed] .

[edit] Holding
Initially the Birlas, the Tatas and AT&T Wireless each held one-third equity in the company. But following AT&T Wireless' merger with Cingular Wireless in 2004, Cingular decided to sell its 32.9% stake in Idea. This stake was bought by both the Tatas and Birlas at 16.45% each. Tata's foray into the cellular market with its own subsidiary, Tata Indicom, a CDMA-based mobile provider, cropped differences between the Tatas and the Birlas. This dual holding by the Tatas also became a major reason for the delay in Idea being granted a license to operate in Mumbai. This was because as per Department of Telecommunications (DOT) license norms, one promoter could not have more than 10% stake in two companies operating in the same circle and Tata Indicom was already operating in Mumbai when Idea filed for its licence. The Birlas thus approached the DOT and sought its intervention, and the Tatas replied by saying that they would exit Idea but only for a good price. On 10 April 2006, the Aditya Birla Group announced its acquisition of the 48.18% stake held by the Tatas at Rs. 40.51 a share amounting to Rs. 44.06 billion. While 15% of the 48.14% stake was acquired by Aditya Birla Nuvo, a company in-charge of the Birlas' new business initiatives, the remaining stake was acquired by Birla TMT holdings Private Ltd., an AV Birla family-owned company. Currently, Aditya Birla Group holds 49.1% of the total shares of the company. Malaysia based Axiata controls a 14.99% stake in the company.[3]

[edit] 3G
On 19 May 2010, the 3G spectrum auction in India ended. Idea paid 5768.59 crores for spectrum in 11 circles. The circles it will provide 3G in are Andhra Pradesh, Gujarat, Haryana, Himachal Pradesh, Jammu & Kashmir Kerala, Madhya Pradesh, Maharashtra, Punjab, Uttar Pradesh (East) and Uttar Pradesh (West).[4]

[edit] Subscriber base

Idea's subscriber base as at the end of January 2011 according to the [1] is as follows

Maharashtra and Goa - 12,075,220 Madhya Pradesh and Chhattisgarh - 8,401,422 Andhra Pradesh - 7,831,260 Kerala - 6,398,170 Kolkata -10,001,804 Gujarat - 6,632,034 Uttar Pradesh (West) & Uttarakhand - 7,361,534 Delhi - 3,609,746 Haryana - 2,847,079 Uttar Pradesh (East) - 4,935,224 Rajasthan - 2,823,910 Himachal Pradesh - 479,882

Mumbai - 1,822,280 Bihar & Jharkhand - 4,280,626 Tamil Nadu & Chennai - 1,202,343 Orissa - 985,737 Punjab (Spice) - 4,160,189 Karnataka (Spice) - 3,775,443 West Bengal - 1,728,308 Assam - 206,140 Jammu & Kashmir - 93,072 North East India except Assam - 128,807

Totalling to 84,289,641 or 10.93% (Approx.) of the total [5] mobile connections in India.

[edit] Competitors
Idea competes with 14 other mobile operators throughout India. They are Aircel, Airtel Cheers Mobile, BSNL, Loop Mobile, MTNL, MTS, Ping Mobile, Reliance Communications, S Tel, Tata DoCoMo, Tata Indicom, Uninor, Videocon, Virgin Mobile and Vodafone