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Entry Strategies of Foreign Companies in Indian Telecommunications Market University of Fribourg Switzerland Entry Strategies of Foreign Companies in Indian Telecommunications Market Thesis presented to the Faculty of Economics and Social Sciences at the University of Fribourg (Switzerland) to obtain the doctoral degree in Economics and Social Sciences By Kiruba Jeyaseeli BENJAMIN LEVI from India Accepted by the Faculty of Economics and Social Sciences on 4 th July 2006 on the recommendation of Prof. Dr. Rudolf Gruenig (First Advisor) and Prof. Prabhu Guptara (Second Advisor) Fribourg, Switzerland 2006 The Faculty of Economics and Social Sciences at the University of Fribourg neither approves nor disapproves the opinions expressed in a doctoral dissertation. They are to be considered those of the author (decision of the Faculty Council of 23 January 1990). Dedication iii Dedication I dedicate this thesis to my husband Benjamin Levi Moses, our son Steve Benjamin, and to my parents Grace Ambika and David Selvaraj. Dedication iv Acknowledgements v Acknowledgements I wish to thank all those people who provided personal and practical support without which this doctoral thesis would not have been possible. I would like to thank my first advisor, Prof. Dr. Rudolf Gruenig, the Head of the Chair of Management, the former Dean of the Economics and Social Sciences Department and the current Vice Rector of the Universtiy of Fribourg in Switzerland. He not only guided my thesis but also was readily available for me and always responded to the drafts of each chapter of my work patiently and quickly. His extensive knowledge of Strategic Management, and his comments and suggestions were always perceptive, helpful and appropriate. He fostered an affable working relationship, which was critical to the completion of the work. I wish to thank him not only for his expert guidance and patience but also for giving me the privilege to work in the Chair of Management as his Assistant, which gave me an opportunity to improve my knowledge base, appreciate his style of working, support myself financially and also enabled me to contribute to his teaching programs and publications. I wish to thank my second advisor, Prof. Prabhu Guptara, Director, Organizational Development, Wolfsberg (a wholly-owned subsidiary of Union Bank of Switzerland); Chairman of Advance Management Training Limited, UK; Freeman of the City of London and of the Worshipful Company of Information Technologists; Fellow: of the Institute of Directors, of the Chartered Institute of Personnel and Development, of the Royal Commonwealth Society, and of the Royal Society for Encouragement of the Arts Commerce and Manufactures; and a Visiting Professor at various Universities and Business Schools. With vast experience internationally, he is an eloquent speaker and a charismatic person with an abundance of ideas. His suggestions were thought provoking and valuable at all times. In spite of shouldering numerous responsibilities and being involved with activities round the globe, he responded to me quicker than expected. His immense knowledge on internationalization strategies brought new in-sights to the thesis work. I am grateful for the interest, love and support he showed not only to me but also to my family. I want to give my heartfelt thanks to my father, Dr. D. Selvaraj, a Senior Civil Service Officer of the Department of Telecommunications, Government of India, who has been associated with the telecom department at various levels for the last 35 years, Fellow of the Institute of Cost and Acknowledgements vi Management Accountant of India, visiting faculty of leading professional and management Institutions in Delhi and possessing various post graduate degrees in management for rendering all help and assistance in completing my thesis. But for his help it would have been very hard to procure latest and appropriate material on Indian telecom and to get in touch with key persons from the Indian telecom market. Though being a busy person himself, he was always just an e-mail or phone call away and went to any extent to help me in carrying out the work. I wish to thank my former MBA colleague, Mr. Paramvir Singh from New Delhi in India, currently working as Senior Executive in the Information & Communications division of the telecommunication business of the Siemens AG group in India, for updating and providing me with some key information about private telecom operators in India which aided in the choice of companies for the case studies in this thesis. I am grateful to Prof. Dr. Paul M. Swiercz of the Department of Management Science of George Washington University and Dr. Joseph Shields, Senior Associate – Research, Software Engineering & Technology Labs of Infosys Technologies Limited in Bangalore, India, for sharing their views. I also extend my sincere thanks to Mrs. Dr. Jocelyne Imbach, Vice-Director and Studies Coordinator of the International Institute of Management in Telecommunication of the University of Fribourg for allowing me to use their library where I could find a plethora of material related to strategies and telecommunication. I am grateful to Dr. Tim Kelly, Head of Strategy and Policy Unit of the International Telecommunication Union in Geneva; and Dr. Paul Polishuk from the Telecom Research and Consulting of the IGI Group Incorporated in Boston and the Asia Pacific Telecommunity in Bangkok, for furnishing me with valuable printed and electronic material free of charge, which otherwise was unaffordable. I am thankful, too, for much assistance received from numerous libraries, especially the Economics Library of the University of Fribourg, BCU (the cantonal library of Fribourg), and the inter library loan facility. I wish to give special thanks to Dr. Hans Ulrich Pestalozzi the former CEO of Bayer International S.A. Fribourg, Switzerland, Mr. Beat Fasnacht the Director of Almedica AG Switzerland, and the committee of the Federal Commission of Scholarship in Bern for offering me financial support Acknowledgements vii during the period I worked on my thesis. Without this support, my thesis would not have been accomplished. I wish to thank my interviewees who held the following position at the time of the interview for giving me their valuable time and information: Mr. Antoine Andenmatten, Deputy Head of Participation Management of Swisscom AG; Mr. Michel Vetil and Amresh Sood, CEO and General Manager Accounts and Finance respectively of Alcatel India Limited; Mr. Niru Mehta, Managing Director of Avaya Communications India Limited; Mr. Manoj Kohli, Executive Director & Chief Executive Officer of First Pacific India/Escotel Mobile Communications Limited; Mr. Joseph Samuel, Managing Director of Nortel Networks India Limited; Mr. Jagdish Kini, Chief Executive Officer of Bharti Mobile Limited; Dr. Harsha V. Singh, Secretary cum Principal Advisor of Telecom Regulatory Authority of India; Mr. Narinder Sharma, Chairman & Managing Director of Mahanagar Telephone Nigam Limited; and Mr. Rajneesh Gupta, Director of Videsh Sanchar Nigam Limited. I would be remiss in my responsibilities if I did not acknowledge my colleagues at the Chair of Management who offered their valuable suggestions during the internal doctoral seminars, our friend Mr. Urs Baumann who read portions of the thesis and gave his helpful suggestions, and for friends who prayed for strength and wisdom to complete the work. Last but not the least, my deepest thanks goes to my family, especially to my husband Rev. Dr. Benjamin Levi Moses, who was also working on a Ph.D at the same time. Next to God, he was the source of love, support and patience. He encouraged and supported me whenever I was physically and mentally weary. Not only did he extend his hand to reduce the strain and the over-load of responsibilities at home but also provided me assistance by helping me find material and going through my work and giving his opinion as a layman. Our four-year-old son Steve Benjamin was the greatest source of joy after hours of strenuous mental work. He quietly tolerated the deprivation of many rightful privileges due to the time and effort I had to invest on my thesis ever since he was born. My sincere gratitude goes to my parents Mrs. Ambika Selvaraj and Dr. David Selvaraj who encouraged me to pursue a career in this field and inspired and motivated me. I am also thankful to my sister Mrs. Niranjana David, who is currently working as an Educational Consultant for Fortrust International, Singapore for furnishing me with first hand information regarding the latest publications on telecom and related items from various journals. Fribourg, February 2006 Kiruba J. B. Levi (Jessy) Acknowledgements viii Brief contents ix Brief contents Dedication.............…………………………………………………… iii Acknowledgments.…………………………………………………... v Brief contents……………………………………………………..….. ix Contents…………………………………………………………..….. xi List of figures……………………………………………………..….. xvii List of tables……………………………………………………..….... xix List of abbreviations...……………………………………………..… xxiii I. Introduction.…………………………………………………... 1 II. Strategic management and market entry strategies in the literature.………………………………………………………. 17 III. Telecom market in India…………………………………….… 63 IV. Description and assessment of cases on market entry strategies of foreign companies in Indian telecom market….… 117 V. Recommendations and guidelines for foreign companies entering Indian telecom market in future.…..…….…………... 191 VI. Final remarks……………………………………...………….. 215 Appendices.……………………………………………..…………… 219 Company specific sources.……………………………………...…… 269 Bibliography.…………………………………………………………
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