Stampede of companies hoping to get new telco operating license (& hence the spectrum) in India

More than 500 companies have applied for new telco operating licenses in India. AT&T was one those who applied just before the closing bell for applications.
If AT&T should get the license, it would set the stage for a battle royale between it and Vodafone for a share of the world's fastest-growing cellular market.
AT&T's wireless unit, the former Cingular, is of course already in a death match in the United States with Vodafone because Vodafone owns 40 percent of Verizon Wireless. An extension of that battle to India, where cellular-phone use is growing at an estimated eight million subscribers per month, thus would have the industry worldwide on the edge of its seats.
Just to make things even more interesting, Sistema, the owner of Russia's largest wireless carrier, Mobile TeleSystems (MTS), also has applied for an Indian cellular license. There's also some suspicion that, buried in the pile of 500 applications, are papers from proxies for other Tier One cellular players on the world stage.
While DoT is scratching its head over how to decide which of the applicants should get licenses - it hadn't expected to need a process to sort through hundreds of applications. Planning is said to center around a two-stage procedure, most likely the initially weeding out those whose goal is to get a license simply to resell it, instantly becoming quite rich in the process.
What the flood of applicants wants is what's called a Universal Access Services Licence (UASL). Such a license, though, doesn't come with any spectrum; that will be a separate - and potentially expensive - issue. Indeed, there are said to be more than 20 Indian companies that last year were allowed to buy licenses, but they aren't in the cellular business yet because they haven't gotten any spectrum.
At this point, the Indian authorities haven't said exactly what spectrum they eventually will put on offer, although the widespread expectation is they will be looking at channels for 3G and possibly 4G service offerings.
In an almost identical arrangement, Vodafone is paired with India's Essar Group - having bought the Hutchison Telecommunications International Limited (HTIL) stake in what had been Hutchison-Essar earlier this year (TelecomWeb news break, Feb. 12). Vodafone-Essar, though, already is a licensed cellular carrier in India - with Number Three market share as is Idea, sitting in the sixth spot. In all, there are 13 wireless competitors in the market (10 of them offering GSM, three CDMA and one both), although most do not have licenses and spectrum that cover the entire country.
The list of applicants is known to include at least eight major real-estate firms in India.

New "Tilt" in the enterprise phone segment

BlackBerry , iPhone and now Tilt. AT&T is launching new enterprise segment phone. This has not been one of my favorite topics, but the enthusiasm raised by iphone has forced me to look into the features of new "Tilt". We might soon have them in India (Provided DoT acts fast on new applications for licences)

The new "Tilt" phone from AT&T, that may be available in mear future may become the next enterprise phone that may also fit the bill (unlike ipone).
AT&T says the Tilt is its first Windows Mobile 6 smart device, featuring a slide-out QWERTY keypad, a 3-megapixel camera, 3G data speeds from AT&T's UMTS/HSDPA-based BroadbandConnect network and complete global connectivity.
Windows Mobile 6 Tilt users get "the familiar look and feel of their desktop computers at home or in the office," the carrier says, enabling them to view e-mail in their original rich HTML format with live links to Web and Microsoft Office SharePoint sites. All Windows Mobile 6 devices include Microsoft's Direct Push Technology for e-mail delivery and automatic synchronization of Outlook calendars, tasks and contacts through Microsoft Exchange Server. Especially important to enterprises, Windows Mobile 6 offers important device security and management features, including capability to remotely wipe all data from a device should it be lost or stolen, thus helping to ensure that confidential information remains that way.
In addition to Microsoft Direct Push, the AT&T claims its Tilt will be "the first Windows Mobile device in North America to include BlackBerry Connect v4.0 software, which provides BlackBerry e-mail service, security and device management for IT administrators and the benefit for users of wireless synchronization of e-mail, calendar, contacts, task list and memo pad information." BlackBerry Connect v4.0 supports push e-mail for Microsoft Exchange, IBM Lotus Domino and Novell GroupWise through the BlackBerry Enterprise Server and personal e-mail through the BlackBerry Internet Service.
Customers also can use the Tilt to access personal e-mail through AT&T's Xpress Mail service. By completing five steps, AT&T customers can set up their Xpress Mail accounts and begin getting personal e-mail from most major POP3/IMAP personal e-mail services pushed to their AT&T Tilt at preset intervals. They also can sync their calendars, access contact lists and view attachments.
Designed by HTC, which really has been putting itself out there this year at wireless industry shows, the AT&T Tilt also features a 2.8-inch color screen that slides back to reveal a full QWERTY keyboard, and then it "tilts" up to position the screen for reading or creating e-mail, browsing online, using applications or just playing videos and games. The Tilt supports Bluetooth 2.0, allowing as many as six Bluetooth devices to be connected simultaneously to the device; Bluetooth Stereo also is supported.

In addition, the AT&T Tilt features the latest version of TeleNav GPS Navigator that provides GPS-enabled turn-by-turn voice and on-screen driving or walking directions, colorful 3-D moving maps and traffic delay alerts with one-click rerouting. The new GPS version also includes address sharing that allows users to share their current locations or the location of their favorite businesses with other mobile users. Business users have access to TeleNav Track, a mobile workforce-management solution that includes GPS-enabled tracking, time sheets, wireless forms, navigation, job dispatching and bar-code scanning.

Regarding the mobile enterprise need for speed, with 3G broadband speed connectivity across the globe and tri-band UMTS/HSDPA capabilities, the Tilt can operate in Japan and South Korea along with the more than 135 countries in which AT&T offers UMTS, EDGE or GPRS international data roaming. For voice, AT&T says road warriors can make or receive phone calls in more than 190 countries
In the States, the Tilt can connect to AT&T's BroadbandConnect network in more than 170 major metropolitan areas, and coverage outside of 3G service areas is available via AT&T's EDGE network where available. Wi-Fi connections are supported by the 802.11b and g frequencies, and enterprise users can use the Tilt to link to corporate wireless LANs or home Wi-Fi networks.
The new phone is pretty affordable at $299.99 after rebate; customers are held to a two-year contract. Unlimited monthly data plans for corporate e-mail are $44.99 with a voice contract. Data plans for personal e-mail, begin at $29.99 a month for 20 MB; that price reflects a $5/month discount for voice and requires that an eligible wireless voice plan be activated and maintained on the same device (limited to one discounted price per eligible voice plan, the carrier says). AT&T also offers an international data plan for the Tilt -- 20 MB in nearly 30 countries -- for an additional $24.99 a month. TeleNav GPS Navigator is available for additional monthly charges of $5.99 for 10 trips and $9.99 for unlimited trips. TeleNav Track service plans range from $12.99 to $21.99 for each device.
In a related product announcement across the border, Rogers Wireless in Canada says it is increasing its presence Windows Mobile market with the introduction of the Palm Treo 750 smartphone and the MOTO Q 9h. The carrier also announced a free online Windows Mobile 6 upgrade for the HTC S621. In support, Rogers launched an ad campaign earlier this week raise enterprise awareness about how Windows Mobile-based applications help mobile professionals stay productive while away from the office.
"The Canadian converged mobile device market has experienced tremendous growth over the past few years registering 56 percent year-over-year growth in 2006. This has been fuelled largely by Canadian organizations' need to improve employee effectiveness by helping them access company information," says Eddie Chan, research analyst/Mobile/Personal Computing & Technology at IDC Canada. "The availability of high-speed connectivity, combined with the familiarity of the Windows-based platform in a mobile environment, such as Windows Mobile 6, can help organizations and their employees realize the benefits of a mobile solution."

(The features have been sourced ffrom telecom news break story)

Enterprise solutions - AT & T launches 1 Gb/s bandwidth on demand

AT & T's business arm has launched a 1 Gb/s bandwidth on demand offering, as part of its year-old optical mesh offering, for its enterprise and wholesale customers.
The Optical Mesh Services offering lets customers reallocate bandwidth as needed by increasing or decreasing network capacity in what AT&T calls "near real time." It also lets enterprise customers build and self-administer their own SONET networks using the AT & T BusinessDirect customer portal.
AT&T said that the new 1 Gb/s speed is available at 275 locations around the country linked by what it calls its Intelligent Optical Network - a self-healing network with claimed five nines reliability.
A dynamic Layer 1 service helps companies trying to solve the dilemma of build versus buy. An on-demand optical solution with as much needed bandwidth is a compelling solution for mission-critical business applications with zero tolerance for downtime, as well as for business continuity.

Battle won for Wimax - ITU Accepts IEEE 802.16 as a 3G Standard

The IEEE 802.16 has been accepted by the International Telecommunication Union (ITU) as the sixth technology that it has accepted as a 3G wireless standard. The move has caused celebration in both the WiMAX and WiBro communities - both of which are based on 802.16 variations.
WiMAX/WiBro/802.16 join rival technologies W-CDMA, CDMA-2000 and TD -SCDMA in the ITU's IMT-2000 3G spectrum standard.
Technically the ITU has accepted what it has termed "IMT-2000 OFDMA TDD WMAN," a specification "based on a normative reference to IEEE Std 802.16. In other words, IEEE Std 802.16 is now part of the IMT-2000 family. WMAN, is short for "wireless metropolitan area network," which is the real name for 802.16, as set by the IEEE. Put another way, the ITU didn't accept WiMAX. It accepted WMAN. WiMAX, as defined by the WiMAX Forum, is "based upon the harmonized IEEE 802.16/ETSI HiperMAN standard.
South Korea's WiBRO is a mobile form wireless broadband also based on 802.16 and that may even some day be compatible with what's emerging as mobile WiMAX.
Indeed, even Ambassador Richard M. Russell, the U.S. Representative to the World
Qualcomm has fought hard to keep 802.16 away from ITU acceptance whereas Intel has spent a large fortune promoting the technology so that it could break what it sees as Qualcomm's stranglehold on 3G.
One little caveat in the ITU action that at least some observers noted is that what the ITU approved was 802.16 as a Time Division Duplex (TDD) technology. That's fine for the attempt to craft a mobile WiMAX, which is based on TDD. However, the ITU didn't accept 802.16 for use in Frequency Division Duplex (FDD) bands, which account for an estimated 80 percent or more of all the licensed frequencies in the world.
On the other hand, the ITU approval specified OFDMA - Orthogonal Frequency Division Multiple Access - the first time the ITU's done that. Many in the industry believe OFDMA will be a key technology included in the standardization of 4G wireless technology.

New standard for WiMAX unveiled

The CDMA Development Group (CDG) and the Third Generation Partnership Project 2 (3GPP2) has recently released their proposed Ultra Mobile Broadband (UMB) standard, the technology they hope will trump the mobile iterations of IEEE 802.16e-2005 (so-called mobile WiMAX) and Long-Term Evolution (LTE) as the world's eventual 4G standard.
The proposal now needs to undergo final standardization, which backers predict will be a rapid process. In the United States, UMB is scheduled to emerge as Telecommunications Industry Association (TIA) standard TIA-1121.
The UMB proposal is an Orthogonal Frequency Division Multiple Access (OFDMA) solution that uses
- "sophisticated" control and signaling mechanisms;
- radio resource management (RRM);
- adaptive reverse link (RL) interference management; and
- such advanced antenna techniques as Multiple Input Multiple Output (MIMO), Space Division Multiple Access (SDMA) and beamforming.

It supports inter-technology handoffs and seamless operation with existing CDMA2000 1X and 1xEV-DO systems. It claims to be able to deliver both high-capacity voice and broadband data in all environments, including fixed, pedestrian and fully mobile in excess of 300 km/hr. It supports, proponents say, as many as 1,000 simultaneous VoIP users within a single sector, using 20 megahertz of bandwidth. Average latency is 14.3 mSec over-the-air to support VoIP, push-to-talk and other delay-sensitive applications with minimal jitter.
The unveiling of the UMB proposal, an IP-based mobile broadband standard alleged to enable peak download data rates of 288 Mb/s in a 20-megahertz bandwidth, is clearly evidence that a 4G technology potentially four times as fast as mobile WiMAX is almost market-ready. The CDG and 3GPP2 estimate initial commercial availability at the first half of 2009, and they clearly hope to convince carriers looking at 802.16 to instead wait just a little longer what the CDG fancies is a technology that will "leapfrog other wireless broadband technologies to become the leading standard adopted for next generation mobile telecommunications."
And, of course, all the players - including UMB, LTE and the mobile WiMAX camp - are in a death match for designation as the official definition of wireless 4G technology. That definition won't be released until the 2008/09 timeframe, in the form of the International Telecommunication Union's (ITU) IMT-Advanced requirements. However, some folks, like those at research house In-Stat, also think initial implementations of LTE, UMB and 802.16 WiMAX may fall short of throughput and other expectations, with later enhancements or even some type of technology combination actually bringing real 4G to the table But that's not what the corporate backers of each of the technologies really wants (Qualcomm is behind UMB, which it considers a member of the CDMA 2000 family; Ericsson is touting LTE; and Intel has spent uncounted millions singing the glories of WiMAX). Each wants its technology to be "the one" - thus the faster the push to get UMB at least certified as a TIA standard before the ITU acts, the better to compete with the fact there is an IEEE designation for the foundation technology behind what is being called WiMAX (without, interestingly, the official permission of the IEEE).
"It is expected that the UMB specification will be quickly converted into an official global standard by the 3GPP2 organizational partners," the 3GPP2 said in its statement unveiling the final UMB proposal. It also noted that those "organization partners" include the Association of Radio Industries and Businesses (ARIB) in Japan, China Communications Standards Association (CCSA), TIA in North America, the Telecommunications Technology Association (TTA) in South Korea and the Telecommunications Technology Committee (TTC) in Japan.

Enterprise Segment - The new mantra for Telecom equipment vendors & service providers

Every Vendor in Hardware/software Telecom space is eying at Enterprise segment. The offerings are based on variety of hardware and software platforms. Here are few examples -

- Cisco has recentlyunveiled a new line of hardware and software in its "Empowered Branch" portfolio, building on the offerings it already has that are designed to give branches essentially the same type of service as corporate headquarters.
The latest gear even extends to tiny offices with fewer than 20 workers.
The new offerings include the first "lite" version of Cisco's flagship IOS software, hardware that includes routers and LAN switches, and new support for 802.11n wireless. With the emergence of new business applications and a more collaborative global business environment, Cisco customers are putting a greater emphasis on their remote offices. Cisco Empowered Branch allows them to take advantage of new business opportunities by providing them with a network platform that addresses all their application and service needs today, yet continuously evolves to provide service innovations required for the future.

- The International Association of Managed Service Providers, better known as the MSPAlliance, has launched a Vendor Accreditation Program (VAP) for the managed-services industry and named the first seven vendors certified under that program.
Those first seven are Intel, SilverBack Technologies/Dell, Asigra, Untangle, XRoads Networks, LiveCargo and N-Able Technologies.
The Alliance, which claims membership of some 2,000 managed-service providers (MSPs), already has been accrediting MSPs, but this is the first time it's accredited the suppliers that provide systems and software to those MSPs. The group wants to grow the first seven accredited vendors quickly to a group of at least 50.

- BT Conferencing, the conferencing and collaboration services division of BT, entered into a strategic partnership with the Corporate Executive Board to provide global collaborative services for the next three years to the Board's enterprise clientele.
As part of the agreement, BT Conferencing will provide Corporate Executive Board with managed audio and Web services to its network of more than 14,000 C-suite executives and their staff from more than 3,700 leading global corporations and organizations, including much of the Fortune 500. Implementation of the new service already has begun, and it should be in full swing by the end of the week.
BT Conferencing has offices in the United States, EMEA and Asia Pacific; it specializes in delivering conferencing and collaborative solutions and product hardware to some of the largest companies in the world, and its solutions are designed for enterprises a million minutes or more of conferencing time. The Corporate Executive Board Company provides best-practices research and analysis focusing on corporate strategy, operations and general management issues.

- In North America and Western Europe, large companies will play an increasing role in VoIP adoption, says ABI Research, adding hosted services will be used on a more regular basis as well, becoming a stronger engine for enterprise VoIP growth in the future.
The hosted services market for VoIP applications initially focused on (and found success with) smaller companies, the research firm says. Typically, smaller companies do not have the IT staff or the budget to install their own VoIP systems. As a result, they often rely on service providers for VoIP services that include the type of features found in large-enterprise phone networks. Service providers have not focused on large-enterprise-hosted phone services, but this is likely to change in the future as telecom operators (i.e., the traditional market leaders) face new competition in the smaller-business market from competitive operators, cable operators and other alternative-service providers. ABI Research believes service providers will take their experience with easy-to-serve small companies to adaptively re-size to favor larger companies.

The news from all quarters on enterprise telecom business and solutions are pouring in from all quarters. In India also the market is already estimated to be sized at Rs 10,000 cr pa and is growing fast. The success of telecom operators in this segment will depend not on an early move but on the right move. The one who can mix the right technologies with the best service level agreements will emerge as winner

US Treasury to get next-generation enterprise network - Similar large enterprise business opportunities to crop up in India soon

Came across the following news item. My comments are at the end.

AT&T has picked up what could amount to a $1 billion order to build a next-generation enterprise network for the U.S. Treasury. The award is the first of what eventually will be dozens of billions of dollars spent by the U.S. government under the Networx Universal contract, the largest single telecom order in the history of the world, shared by teams led by AT&T, Verizon and Quest.
Under the Treasury order, AT&T and members of its team are to build and transition the Treasury to a next-gen enterprise network known as the Treasury Network (TNet). Technically, the award is for $270 million but, with various add-ons and options, it's expected to hit $1 billion. What the Treasury has ordered is a fully managed network service, coupled with service-level agreements and performance incentives to deliver secure voice, data and video communications.
The Networx contract actually represents a reiteration of a $1 billion, 10-year contract Treasury had awarded AT&T in December 2004. That award was the following year, following protests upheld by the GSA. Initially, it had been thought Treasury would re-bid the contract itself but, as it now turns out, it's now under the Networx umbrella.

In India also many of the state government treasuries have built their networks at the cost of millions of rupees. Govt. of M.P., Karnataka etc have been leaders in this respect. The next wave of upgrading these networks to next -generation manages service networks is expected soon and will be a big business opportunity for Indian Telcos

A case for implementing number portability in India

Well friends the debate on implementation of number portability in India is now almost 3 years old. The issue keeps popping up every time TRAI comes out with some statements. Here are the extracts of my arguments in favor of implementing the same. These were presented at a debate at IIM Bangalore. I have covered them in a post earlier , but am repeating them in view of the currency of the issue. I welcome your comments on the same. -

What is number portability (NP)?

Number Portability
 allows subscriber to change their service provider to one having –
 the best service quality
 lower tariff options,
 & better network coverage

while retaining their old telephone number.

Technological reasons for implementing

Arguments against implementation - India not yet ready as Implementation requires large technological changes;

My Argument why it should be implemented
Our Mobile network is state of the art; technically much better than many countries where MNP is already working
 We introduced many services ahead of even developing countries e.g. GPRS
 Fixed line NP may have problems; can be sorted and taken up in next stage
 If it can work in S Korea – 2004; Greece – 2004; Lithuania – 2005; Belgium – 2000; Honk Kong - 1998
 why not in India

Arguments against implementation - India not yet ready as Our tele-density is still much below developed countries; We should concentrate on increasing tele-density; We have enough operators for competition

My Argument why it should be implemented
 Mobile nos. in India are largely in Urban areas. Our urban tele-density is ~40.
 We added almost 18m mobiles in last 3 months. That means urban teledensity has increased over 6 in last three months.
 Requires 12-18 months in implementation after decision. Urban tele-density may cross 50 by then. following table indicate that we will be at par or better than developed countries in terms of tele-density for implementing Number Portability(NP)

 For one service say GSM mobile we have maximum 4 operators per service area

Economic reasons

Arguments against implementation - Implementation require huge initial investments, which will outweigh the benefits. Rather we should Concentrate on improving service quality

My Argument why it should be implemented
 Its exactly the service quality for which we need NP
 Today India has one of the lowest rates for mobile services but quality of service offered is poor
 NP eliminates pseudo and psychological barriers to churning thus providing truly competitive market and service quality improvement
 Some estimate costs as high as 5000 Cr for implementation which are amplified and incorrect estimate even for implementing full fledged NP across services, operators & Locations
 Implement just Mobile NP, then go for fixed line
 Call forwarding technology does not requires much costs
 Even other technologies for mobile number portability we require central database, routing and query arrangements. It will not cost more than 150 cr to implement.
 India has 85m mobile connection now. By 2007 they will be more than 150m. Even if 10% use NP we have 15m users. (Spain 3m used.); International Data Corporation India conducted a survey and found that “30% of mobile subscribers are likely to shift to an operator offering better service, if given the option.” Internationally 10% churning of numbers with NP is common as shown in following figure-

 Charge of Just Rs 200 can cover costs. Internationally average charges are around 12-14$.
 If consumer is ready to pay for better service and availing better tariffs, why it should not be implemented

Operational reasons

Arguments against implementation - Implementation will have problems of distortions by donor networks

My Argument why it should be implemented
 Good planning and proper regulations on following issues can help in smooth operations –
 Go for all India implementation
 Don’t go for call forwarding option
 Locking of handsets to be banned
 Address lock in period problems
 Costs to be collected and born by recipient networks
 Operational problems can always be sorted out in time. After all India is not the first country to implement the NP

The US Supreme Court has directed adoption of number portability and India should also follow. The department of telecommunications (DoT) has set April, 2007 as the deadline for the implementation of mobile phone number portability. The deadline had been recommended by the Telecom Regulatory Authority of India (Trai) and submitted to the DoT in March '06
 India is well prepared for introducing number portability
 It should be introduced in phased manner –
 Mobile number portability across the nation amongst all operators
 Then fixed number portability
 Non implementation of NP will negate the concept of “True market” and operators will go on compromising on service quality standards

Snapshot picture of CDMA deployment in India

These extracts from report of CDMA Development Group (CDG) gives a good snapshot picture of CDMA deployment in India. I thought the extracts were worth sharing.

"The CDMA arena in India is booming, with that country's CDMA2000 subscriber base now topping 50 million fixed and mobile users. The India's subscriber growth reached this milestone in only five years, half the time it took GSM to reach the same number in the subcontinent. The CDG attributes this rapid growth in the region to the economic delivery of differentiated value-added services, network expansion into the rural areas of India and the growing availability of very-low-end (VLE) devices.

With 2 million net subscriber additions in July, CDMA2000 subscriber base in India reached 51.1 million. Reliance Communications and Tata Teleservices, which the group says are among the Top 20 fastest-growing operators in the world, are investing in the CDMA2000 business to further accelerate this growth rate. CDMA2000 devices have experienced 50 percent year-over-year growth since 2003, with more OEMs participating in CDMA than in GSM.
In addition, the rapid expansion of CDMA2000 networks into rural areas of India to deliver voice and broadband Internet access has been a primary factor in reaching the 50- million-subscriber milestone. India reportedly leads the industry in the introduction of affordable fixed and mobile broadband access to underserved markets. In fact, the CDC says Reliance has launched one of the largest CDMA2000 network expansions on the planet -- with plans to reach more than 20,000 towns and 300,000 villages. In addition, CDMA2000 operators are poised to begin a seamless upgrade of their existing networks EV-DO Rev A.
With trials underway and operators rapidly expanding into the rural areas of the country, EV-DO Rev. A is expected to become an effective platform for enabling affordable broadband Internet access and value-added services in India's rural and urban markets. BSNL has already announced tariff plans for 1X and EV-DO broadband data services, supported by PC cards and USB thumb-drive modems. Tata introduced what it says is India's first 1X USB thumb-drive modem to support its Plug2Surf wireless Internet services, while Reliance recently acquired Yipes Holdings to address the enterprise market. And recent research predicts more than 35 million people will be using mobile broadband services in India by 2010."

CDMA2000 subscriber growth is also being driven by what the CDG says is India's global leadership in the selection and availability of VLE handsets; there reportedly are 45 VLE CDMA2000 devices from 14 suppliers available in country, and that number is expected to increase dramatically with the further availability of single-chipset devices. Another 10 single-chipset VLE handsets are expected to be launched within the next month, and the Indian CDMA industry has plans to support the local production of CDMA2000 devices.

Mobile VAS revenues in India to touch Rs 8200 Cr by next fiscal !!!

According to an estimate by industry body Assocham, the mobile value added services are poised to grow by over 65 per cent to touch Rs 8,200 crore by the end of this fiscal from Rs 4,950 crore in the last fiscal . The high growth is attributed to a rapidly increasing large subscriber base and easy accessibility to the end-users. Various downloads such as ringtones, bill-related information, contest, exam results and messages received from public services such as banks, railways and airlines earn revenues for the industry. Such revenues will grow and multiply to add volumes to mobile value added services (VAS).

Indian music industry earned more than 35 million dollar from such services which is equivalent to 20 per cent of its total revenue. The total mobile music downloads in Indian markets are valued at 75 million dollars and is expected to grow by 25 per cent in the next year. SMS interactivity, which has become an integral part of most of TV shows, would become a major source of revenue for the channels. TV show Indian Idol on Sony got more than 55 million votes via SMS -- at a rate of Rs 3 per SMS, that is Rs 16.5 crore. The telecom companies earned Rs 11.5 crore and Sony made Rs 5 crore.

What should be the limit on market share after M & A in Telecom space ?

TRAI's consultation paper on licensing norms review has attracted following views from major Indian Telcos :

State-owned BSNL has suggested lowering of the market share limit to 40 per cent from the current 67 per cent following the merger and acquisitions of two entities in the telecom sector to avoid monopolistic situation. "It is felt that the existing provision of 67 per cent market share will create non-competitive or monopolistic situation. It is, therefore, suggested that this limit should be brought down to about 40 per cent"

Vodafone Essar, which has recently acquired number two slot in terms of subscriber base, said "We are of the opinion that the 67 per cent limit is appropriate when applied to a narrow mobile market definition. "But regime of the current M&A Guidelines, not a single intra-circle merger between licensees has taken place to date and it cannot be said that the current guidelines have produced an environment of undue consolidation. The guidelines, therefore, remain appropriate."

CDMA player Tata Teleservices wants this cap to be at 45 per cent. "We recommend a maximum market share of 45 per cent for the merged entity," the company said. The PSU also wants fixing a maximum spectrum limit that would be held by a merged entity be. It also does not want any merger to be allowed between a CDMA and a GSM company. Vodafone Essar said the merged entity should have a spectrum limit.

GSM players in India add 5.4 m subscribers in June 07

GSM players in India added 5.4 million new subscribers in June. the public sector BSNL has registered negative growth in five of the 21 telecom circles where it offers services. Overall, the PSU has added just 4.3 lakh new subscribers in June compared to 1.96 million by Bharti Airtel and 1.54 million by Vodafone-Essar. This also implies that the PSU, which had lost its position as the second largest GSM player in the country to Vodafone Essar in May 2007, has slipped further down. Vodafone Essar now has a total of over 30.75 million subscribers and a market share of 22.61% when compared to 28.42 million and 20.90% for the PSU.

As per the latest data compiled by the Cellular Operators Association of India (COAI), the industry association representing all GSM operators, the GSM subscriber base has touched 136 million as of June end, 2007, up 4.12% when compared to 130.1 million in May 2007. The growth witnessed in June was lead by Bharti Airtel, which added just under two million new users taking its subscriber base to 42.7 million. Bharti now commands a market share of 31.40% in the GSM space. Reliance Telecom, the GSM arm of Reliance Communications has also performed poorly — the company, which has 4.34 million subscribers, has failed to show even a single new addition in all the eight circles it operates. BSNL’s subscriber additions over the last couple of months have been thrown off target as the company has exhausted its capacity in most key circles. The PSU has not undertaken any major expansion contract since October 2005.

This has witnessed even regional players like Idea Cellular which has operations in just 11 circles and Aircel Cellular which has operations in 9 circles overtaking the PSU in terms of subscriber addition over the last couple of months. While BSNL has issued tenders for the supply of over 45 million lines in March 2006, it was so far been unable to place orders for the network equipment. In fact, Idea has added about 0.9 million subscribers last month, which is twice that of BSNL. Last month, among all circles, Category B circles witnessed the highest rate of growth at nearly 5.0%. Within the Category B circles, the highest growth was recorded by the UP (West) Circle at (6.5%) closely followed by West Bengal and Andaman & Nicobar Circle at (6.1%).

Reliance awards US $ 200 m contract to Huawei

India's Reliance Communications has announced the award of a network expansion contract, worth over US$200 million, to Huawei Technologies. Under the agreement, Huawei will supply and provide services for CDMA & GSM base stations, including BSC (Base Station Controller) and switches, and help to create first class all-IP Next Generation Network infrastructure.

Earlier in first week of July , Reliance awarded a similar contract worth US$400 million to Alcatel-Lucent

WCDMA HSPA connections to reach 40m by 2008 !

As per Wireless Intelligence, WCDMA HSPA cellular connections are expected to reach 40 million worldwide by end of 2008. By 2010, WCDMA HSPA is expected to represent around 45% of total WCDMA cellular connections, which are also on track to exceed GSM connections by 2010 in those countries where the network has been launched.
Asia-Pacific is driving growth during the initial phase of adoption, while European operators will boost total WCDMA HSPA cellular connections from the end of 2008. WCDMA HSPA is expected to increase data traffic and non-voice revenues.

WCDMA HSPA will be commercially present in more than 60 countries by the end of next year, based on announced plans. With the aim of bringing broadband speeds to mobile networks, WCDMA HSPA is a software upgrade to existing WCDMA networks typically launched from 2003. WCDMA HSPA will go through a slow adoption phase until the end of 2008. WCDMA HSPA is expected to represent around 6% of total WCDMA connections by the end of 2007 (11 million connections).
"The fastest early growth is coming from Asia-Pacific, with operators such as KTF, Telstra and NTT DoCoMo already very aggressive in migrating their installed base to the new technology," says Gillet. At an operator group level, Vodafone Group could reach 4.5 million WCDMA HSPA cellular connections by the end of next year. T-Mobile has been focusing more on its EDGE network and is expected to be more aggressive in launching WCDMA HSPA, especially in Germany, its home market. Orange and Telefonica O2 are following the same pattern as they expand coverage in their key markets, including Eastern European countries such as Poland and Czech Republic. Finally, from 2009, WCDMA HSPA uptake in Western and Eastern European countries will trigger a fast adoption of the technology worldwide. "In 2010, worldwide WCDMA HSPA cellular connections are expected to represent around 45% of total WCDMA connections, numbering around 278 million cellular connections.

Handset launches - In 2006, operators were offering high-speed services mainly through HSDPA datacards. HSUPA datacards are expected to be introduced in the second half of 2007. HSDPA handsets will be more affordable from 2008, driving volume.
Handset pricing - As WCDMA moves towards the sub-€100 ASP segment, HSDPA benefits from time and volume advantages and is expected to hit the mid tier by the end of 2008. WCDMA HSPA handsets will hit the mass market faster than the existing WCDMA handsets.
Tariffs - Operators will differentiate by offering new services based on flat-rate tariff plans withWCDMA HSPA as one of the enablers.
Network cost of development - WCDMA HSPA is a software upgrade to the existing WCDMA network infrastructure and is therefore not particularly costly except for backhaul.
Network coverage - WCDMA HSPA will generally be implemented over the whole WCDMA network of an operator, starting with the most densely populated zones.
Technology migration - We have assumed that WCDMA to WCDMA HSPA migration will follow a similar pattern to migration from CDMA2000 1X to CDMA2000 1XEV-DO.
Exceptions - Networks in China and India have not been included in the WCDMA HSPA forecasts as operators have not yet announced any official deployment. Similarly, Russian WCDMA HSPA connections have not yet been forecasted.

Source -

ZTE overtake LG to become largest CDMA handset supplier to Indian market

China's ZTE is reported to have overtaken Korea's LG Electronics to become the largest supplier of CDMA handsets to the Indian mobile phone market. The handset manufacturer now has a 26% market share according to market sources cited by the DigiTimes news publication.
ZTE originally entered the Indian market through an agreement with Tata Telecom in 2005 and now includes BSNL and the dominant CDMA operator, Reliance Communications as its customers.
ZTE is reported to have shipped some 15 million handsets in 2006, but had already passed that landmark by the beginning of June this year. The company is expected to ship something like 40 million handsets in total this year.

"Fund transfer market using mobile to grow to $8 billion by 2012" - New opportunity for Telcos

According to ABI Research, The market for mobile fund transfers will grow to a revenue opportunity of nearly $8 billion for wireless carriers by 2012, up from some $10 million last year.
By enabling subscribers to send and receive money using their wireless phones, wireless carriers have the opportunity to bring local banking services to millions of people around the world. Such services also could deliver a valuable new revenue stream. Mobile networks offer a number of advantages over existing fund transfer offerings, but most convincing is the high level of adoption and reach of wireless services both geographically and demographically. However, wireless carriers can't do this alone. The need for a banking license to offer such services in most countries means carriers must partner with established banking institutions. Partnerships are encouraged by offering services institutions an effective way to reach new as well as existing customers. ABI Research believes these partnerships, once forged between operators and the financial sector to target mobile fund transfers, also will provide a foundation for a host of additional joint offerings. Meanwhile, startups focused on delivering mobile fund transfers to mobile subscribers also have emerged to drive mobile fund transfer adoption. In one of my earlier postings - "Banks and Telcos - Partnerships of future", I have actually stressed on the same

While enabling national and even localized fund transfers delivers a good business case for operators, ABI says it is in the realm of international payments or remittances that the bulk of the market opportunity lays. Large sums already flow from workers who move overseas but send payments back to family members and friends in their home countries. Targeting these transactions, several wireless carriers and international financial institutions already are offering or developing an international capability for mobile fund transfers.

Another study by Juniper Research predicts that P2P fund transfers and mobile payments in the developing world, together with the commercialization in 2009 of NFC (Near Field Communications) based mPayments will generate transactions worth approximately $22bn and Mobile Payments to be Adopted by 204 Million Mobile Phone Users

"Customers increasingly want telecom services and products to be bundled" - says study on US market

The J.D. Power and Associates 2007 Residential Regional Telephone Customer Satisfaction Study says cable companies, which for the first time lead the customer-satisfaction rankings for telephone service in all six U.S. regions, are proving to be tough competition, mostly due to the rise of triple-play bundles.
The study is based on responses collected in April and May from 11,911 customers nationwide who receive their local and long-distance telephone service from one provider. J.D. Power looked at six factors are examined in determining overall satisfaction: performance and reliability, customer service, billing, image, cost of service, and offerings and promotions.
The study says 86 percent of cable-based voice subscribers also subscribe to data services from the same provider--up from 71 percent in 2006. Conversely, 36 percent of telecom-based voice subscribers also use their providers to fulfill their data needs, an increase of 7 percentage points year over year. The impact of bundling is further evidenced by the boost in importance weight of the offerings and promotions factor, which has increased by 3 percent since the 2006 study.

Customers increasingly want multiple services and products bundled into one convenient package under a single provider, and cable companies are doing a great job of achieving this with their voice, data and video packages. Even still, local and long-distance phone services remain the most widely accepted services to bundle, with data and video steadily closing the gap over the past three years. While rolling out their video-service offerings, telephone companies can improve their near-term competitiveness by either lowering prices on their core products or perhaps even adding wireless service to their bundle options, as some have already done.
The study also finds that 43 percent of customers are loyal to their voice provider, an increase from 41 percent in 2006. However, among the 12 percent of subscribers who "definitely" or "probably" intend to switch providers, the most frequently cited reasons for doing so include competitive/discounted pricing, convenience and receiving a single bill.

It seems as though most subscribers are becoming more loyal, with 36 percent of those who currently bundle reporting they would add even more products or services from their current provider, making the next several years crucial for both telephone and cable companies. Kirkeby continues.

U.K.'s DTH satellite-TV giant BSkyB has become Britain's fastest-growing broadband provider

U.K. direct-to-home (DTH) satellite-TV giant British Sky Broadcasting (BSkyB) has become Britain's fastest-growing broadband provider in less than a year, with broadband now driving overall growth of the company. In the three months ended June 30 (BkyB's fourth fiscal quarter), it had added a net of 259,000 new broadband subscribers, bringing its total broadband subscriber base to 716,000. It also added 171,000 telephony customers, bringing that total subscriber base to 526,000. In contrast, on the television side of the house, it reported a far lower growth rate and netted only 90,000 new subscribers (after taking into account a hefty churn rate of 12.1 percent, which at least was down a bit from 13.7 percent in the first three months). It now has some 8.6 million subscribers to its core DTH service.
BSkyB is adding more broadband customers than any other provider. The company, which jumped into telephony and broadband last year in order to have a triple-play bundle to fend off such competitors as BT and U.K. cable giant Virgin Media, is on track to reach it target of 3 million broadband subscribers and 10 million TV subscribers by 2010.

BSkyB now is delivering service from 1,150 BT exchanges where it has unbundled local loops, representing 70 percent coverage of U.K. households. The unbundling efforts are six months ahead of plan, the company touts.

Saudi Telecom Co. makes back door entry into Indian Telecom market

In a deal that gives it indirect entrance into the high-growth Indian Telecom market, Saudi Arabia's largest carrier Saudi Telecom Co. has bought a 25-percent piece of Malaysia's Maxis Communications for $3 billion.
As a result of this purchase, Saudi Telecom Co. will own 18.5 percent of GSM carrier Aircel, which is 74-percent owned by Aircel. Aircel provides services in Chennai, Tamil Nadu, West Bengal, Assam, Orissa, Jammu & Kashmir, Bihar, Himachal Pradesh and the North-East. It has a subscriber base of 5.5 million.
Saudi Telecom reportedly had been considering India for some time, this purchase is the first major investment outside Saudi Arabia for the government-owned carrier. "
Officials in the Middle Eastern country apparently have the same concerns over a national telco having ties with foreign carriers, but it looks like those concerns weren't enough to kill the deal. The deal may raise eyebrows of security concerns in India. I will be posting the developments on the blog

Indian telco's inrease oversea activities - Airtel enters European market; Reliance communication signs roaming pact with PBTL

Indian leading private telco, Airtel launched its first foray in telecom in the European market on Thursday, with the launch of its services in Jersey, Channel Islands. Jersey Airtel, a subsidiary of the Bharti Group, on Thursday announced the launch of its mobile services on the Island. The company will offer products and services under the Airtel-Vodafone brand to customers on the Island, over its full 2G, 3G and HSDPA enhanced network. Jersey, along with Guernsey, is a crown property off the coast of France, is one of the world’s leading offshore financial centres with an exclusive focus on financial services, and a playground for the rich and financially famous. Jersey’s GDP and per capital are among the highest in the world, topping most developed nations. The services are being launched under the Airtel-Vodafone brand name.
Customers are being offered significant discounts if they choose to keep their existing handset. Pre-paid customers will get flat rates across all networks in Jersey and another flat rate to all networks across the EU including UK. All of these are still unheard of in Europe, where customers mostly have to pay higher rates for calls from mobiles, to other networks, and so on.

In another move, Indian private telco, Reliance Communications, on Thursday announced a tie up with Pacific Bangladesh Telecom Limited (PBTL) to provide its customers seamless roaming in Bangladesh on CDMA handsets. Following the alliance with PBTL, which runs CDMA service under the name CityCell, Reliance CDMA users would now be able to roam in 200 countries, an RCom spokesperson said. For local and national calls, charges would be Rs 18 per minute while calls into India would cost Rs 29 per minute and incoming calls Rs 18 per minute. PBTL is a joint venture between Singapore Telecom and was the largest operator in Bangladesh. The tie-up will generate revenues from lot of user in West Bengal, Assam and the northeastern part of India who regularly visit Bangladesh.

T-mobile's new hot service - Hotspot@home

HotSpot @Home is the newest one-stop-shop offering from T-Mobile USA, combining the power of Wi-Fi and T-Mobile's nationwide voice and data network, and allowing subscribers to gab as much as they want at home without burning minutes. The carrier says its customers can use their cellphones in a VoIP manner while at home or in a T-Mobile hot-spot-enabled area, and then switch back to the GSM/GPRS/EDGE wireless network when they exit hot-spot coverage. Calls also transfer from T-Mobile's network onto Wi-Fi.
T-Mobile HotSpot @Home is a first-of-its-kind service . Key components of the T-Mobile HotSpot @Home service include new mobile phones designed to seamlessly connect the user to a home Wi-Fi connection or T-Mobile HotSpot. The Samsung t409 and the Nokia 6086 are the first to market, each retailing for $49.99 with a two-year contract on a qualifying rate plan.
T-Mobile also partnered with router manufacturers D-Link and Linksys for Wi-Fi routers optimized for a first-rate calling experience with the T-Mobile HotSpot @Home service. These select routers are designed for simple setup and enhanced battery life for the handset, and T-Mobile says they help ensure voice calls are carried "with the utmost call quality." These routers have commonly available data features found on standard routers, and they reportedly work with customers' existing broadband connection. Consumers can choose which router to use with the service; each is currently offered at no charge with the HotSpot @Home service via mail-in rebate.
For a limited time, to kick off the launch of T-Mobile HotSpot @Home, the service can be added to any qualifying T-Mobile voice plan for only $9.99 per month for a single line, and $19.99 per month for up to five lines on a FamilyTime plan. This means five family members each can have unlimited calling from home over Wi-Fi for one price, when the service is added to a qualifying FamilyTime plan.

Bharti to launch 3G services, Revenues from VAS expected to go up !

Bharti Airtel has completed trials of third generation services that it plans to introduce. The company is now awaiting the allotment of spectrum from the government to launch 3G services in India. Other telecom majors such as BSNL, Vodafone-Essar, Reliance Communications and Tata Teleservices are also carrying out trial runs of 3G appellations and services. According to company executives, the pilots included testing all high-speed internet applications, next generation gaming, video and wireless streaming. Bharti has also put processes in place for seamless migration of all value-added services to the 3G space from its current 2G networks.

Bharti is said to have successfully tried out IMS-based applications, a software platform in line with the latest 3G standards. This implies that content and application developers can use this platform to develop services for Bharti customers. Currently, about 10% of Bharti’s revenues come from value-added services (VAS). This figure is likely to increase to about 15% following the introduction of a slew of new data services following the introduction of 3G services. Operators are currently unable to launch 3G services as the radio frequency for these services are occupied by the country’s defence forces. This comes as the project to get the defence ministry to release 45 Mhz of spectrum (20 MHz for 2G and 25 MHz for 3G) is long overdue. As per the initial plan, the release was due in the second half of 2006, which was later extended to March 2007 and then to July 2007. With the department of telecom (DoT) and the defence ministry locking horns over the release of spectrum, the launch of 3G services is set to be further delayed.

Calling cards market is calling - Airtel says 'Wait' !

Bharti Airtel has put off its plan to kick off a series of tariff wars abroad with the launch of its virtual calling in global markets on account of the complexities and excess demand that the company faced with the launch of this service in the US. Bharti Airtel had launched calling cards in the US in 2006 and said this service would soon be extended to the top 10 countries in terms of the NRI population, which include Canada, the UK, Singapore, Malaysia, Saudi Arabia and other Gulf countries. As per industry estimates, the outgoing traffic from the US to India is about 450 million minutes per month, of which about 200 million minutes are through calling cards. Besides, close to 80% of the incoming calls to India are made from the top 10 NRI countries.

But now, the company has decided to defer the global expansion of this until the glitches faced in the US are solved. In the US, the demand was far higher than the capacity that was installed. Airtel therefore had to upgrade IN platform and augment the capacity. They also had some problems with the subscription process with regard to how customers signed up for this service. Airtel expect to address all issues in the US by August-end. The excess demand for its calling cards in the US—so much so that the back-end could not handle the load—was because the tariffs were reportedly 40% cheaper than the prevailing tariffs there. For instance, its offering of 7.9 cents per minute in the US resulted in AT&T slashing the tariffs for its India 60 Plus calling card from $14.99 per month (around 25 cents a minute) to $11.99 per month (around 20 cents a minute) for 60 minutes talktime to India. “

Airtel expects to be present in the other markets by March 2008 and is currently working on regulatory clearances and network agreements with other long distance carriers in these markets. According to Airtel spokesperson, another reason for the temporary delay was that Bharti did not want to make any compromises on the quality of service. “We have learnt from the US experience. As we take the Bharti Airtel brand outside India, the launch of this service offers us the best chance to make the first impression. We are cautious and we have to do it right as this also marks the foray of the Bharti brand. Our long-term positioning is therefore important as any of the Bharti Group companies can enter these markets in the future,” . After the launch of calling cards, Bharti is planning to target Indian corporates and other companies abroad that employ a large numbers of Indians. It plans to offer them a two-way business model—connectivity to and from India. Bharti’s logic for venturing into this segment in global markets stems from the popularity that calling cards enjoy in these countries.

Saudi telecom to buy 25% of Maxis Communications

Saudi Telecom Co, the largest phone company in Saudi Arabia, bought 25 per cent of Malaysia's biggest mobile-phone operator Maxis Communications Bhd to reach out to more subscribers. Saudi Telecom paid 11.4 billion riyals ($3 billion) for the acquisition, its first major foreign purchase, the company said on Tuesday in a statement posted on the Saudi stock market Web site. The deal will give the company access to a market of 1.4 billion people. “The transaction will be financed through borrowing and self-financing,” the state-controlled company said. Phone companies in Persian Gulf monarchies are expanding as domestic markets mature and demand increases. Saudi Telecom competes with Etihad Etisalat in Saudi Arabia. A third mobile-phone company, Saudi Mobile Telecommunications Co, will enter the market next year.

Saudi Telecom was looking at markets in the Middle East and Asia, and this purchase makes sense because both markets share the same culture, and Maxis services a huge population in Malaysia, India and soon Singapore. The transaction would value Maxis at about $12 billion. Maxis is controlled by T Ananda Krishnan, Malaysia's second-richest man.

I was thinking why the Indian companies are not aggressively moving into the South East Asian, Middle Eastern and African markets. They are rather agreesively fighting for the telecom space within India, in the process cutting each others margins heavily. The rates of telecom services in India are too low and the companies should start looking out of India, instead of chopping each others profits within India.

Verizon to offer wireless wallets to their subscribers

Verizon Wireless has announced their m-commerce service, enabled as a BREW application from technology partner obopay as the first mobile payment offering for any major U.S. carrier, will be available in the coming weeks. The Obopay service will allow customers to receive, send and spend money via their mobile phones, check their account balances, collect money owed from other mobile users, view transaction histories and invite friends to use the system.

With the recent announcement of Verizon Wireless about its partnership with Obopay, analysts are seeing a bright future for mobile payments and for mobile commerce as a whole. Even research firm Strategy Analytics Wireless Media Strategies has reaffirmed its forecast on contactless payment. Wireless Media Strategies Service in their December 2006 report has predicted significant activity in the form of payment and ticketing trials towards the end of 2007 and maintain our projected outlook of $36 billion in spending via contactless payment interfaces on mobile phones by 2011.

Future growth trends in mobile industry - Greener pastures ahead !!

During last few months I have come accross several reports on future growth projections on mobile industry. Some of this data have already been posted on my blog. I thoought it was a good idea to compile some of these projections at a single place so that the readers can conviniently co-relate them. The various sources from where these projctions have been taken are also quoted below.

Mobile advertising worth $14 billion in 4yrs (2011)

Predictions and suppositions on the future evolution of mobile advertising have been going by for some time now. The latest comes from a Strategy Analytics report and says that advertisers hope on reaching more than USD14 Billion by 2011.Still, just recently, debates have emphasized the fact that mobile advertising is considered by many companies as being rather risky and less profitable than the TV alternative. This comes from the fact that the video content they use is still in a primary state and there is room for a great amount of improvement. One thing that might attract companies as to choose mobile phones for placing their advertisements is exactly the fact that this environment is yet little used. This means that it proves to be considerably easier for an announcement to stand out and be fully received by the handset users when there are no other adverts around to distract him from this specific one. The outlook for mobile advertising spend has significantly advanced in the past 12 months. The supply of advertising inventory is rapidly increasing as mobile publishers look to develop advertising as a revenue stream. Major mobile network operators like SprintNextel, Verizon Wireless and Vodafone have all accelerated plans to sell advertising within their mobile media channels and advertisers appear to be responding positively. The Strategy Analytics report also regards game downloads, mobile broadcasting and video on demand, all used as spaces for mobile advertising. Even more, several advertising companies have teamed up with mobile software and service providers in order to better develop means of reaching high profit rates.

Mobile apps worth $66 billion over 5 years

The transformation of variousenterprise applications from fixed to mobile access technology will generate more than $66 billion in carrier service revenue over the nextfive years, says a new market research report from Insight Research Corp.By the close of 2007, service revenues generated by mobile applicationstraversing wired and wireless networks in the US will reach just over $9billion; by 2012, the value of services revenue supporting thoseapplications is forecasted to grow to nearly $13 billion, according to thenew market study. Insight's newly released market analysis report, "The Mobile Workforceand Enterprise Applications 2007-2012," states that telecommunicationsindustry consolidation and job growth in the services sector are bothspeeding a transformation of various enterprise applications to a mobilityenvironment. Citing Bureau of Labor statistics, the study finds thatoccupations working outside of corporate offices are increasing at a muchfaster rate than average employment growth. At the same time, consolidationwithin the telecommunications industry has put all of the requisite pieceparts required to deliver integrated wireless applications within the handsof the remaining companies. "Analyze AT&T, Sprint, or Verizon and you will find that each companynow commands the local, metro, long-haul, and wireless assets required todeliver an end-to-end corporate solution," says Robert Rosenberg, Presidentof Insight. "Equally as important is the fact that these companies areshifting capital expenditures from infrastructure to service control,managed services, and applications. This shift in resource allocations willbenefit enterprises looking to mobilize their traditional applications, soin the months ahead we see a real rush to develop mobile applications,"Rosenberg concludes.

Mobile games worth 11.2 billion by 2010

Total global revenues from mobile games are forecast to increase from USD 2.6 billion (2005) to USD 11.2 billion by 2010, according to Mobile Games, a new strategic research report from Informa Telecoms and Media.
Downloads will account for around two-thirds of total global revenues through 2010, but online multiplayer traffic will start to generate significant income for mobile operators, as cellcos launch more multiplayer games and introduce community features that will encourage user uptake. By 2010, online multiplayer games will generate 20.5 percent of total global revenues.
"The Asia-Pacific and Europe will continue to dominate the global mobile gaming market in terms of revenues and users," says Pamela Clark-Dickson, co-author of the report, and editor of continuous research service Mobile Games Analyst, published by Informa Telecoms and Media. "However the U.S. is set to become the second largest individual market by revenues and users, behind Japan and China respectively, by 2010."
Meanwhile the mobile games industry still has work to do to encourage mass-market adoption of mobile games. This year, just 6.7 percent of all mobile subscribers globally will download and play a mobile game, rising to 15.2 percent by 2010.
"The cellcos' strategy of targeting hardcore gamers was the right thing to do when the market was in its early adopter phase," says Stuart Dredge, co-author of Mobile Games and reporter at Mobile Games Analyst. "But now what the market needs is mass-market take-up, which means that the mobile games industry has to provide games that will encourage more casual users to play."
Merger and acquisition activity is thinning out the mobile games market, especially in the games development and publishing sectors. The race is on to acquire the smaller mobile games companies whose survival to date has relied on the production and distribution of good quality games based on desirable licenses, but which haven't been able to scale their operations.
"Previously consolidation occurred mainly among mobile games companies but recent acquisitions and investments by vendors such as RealNetworks and Cisco Systems attest to a growing interest in this sector from the wider digital media and information technology industry," says Clark-Dickson.
Mobile games companies will also likely embark on brand-building and consumer marketing activities during 2005, as they launch their own direct-to-consumer offerings, and seek to build the profile of mobile gaming in the marketplace.
While the cellcos' decks will continue to be the primary source of games for mobile users, games companies have also started distributing their titles through third-party content portals and through bricks-and-mortar retailers.
"Multimedia memory cards will become an increasingly important games delivery mechanism at retail, particularly for 3D and feature-rich 2D titles," says Dredge. MMCs will contribute 9.1 percent of total global revenues for mobile games by 2010.

Mobile entertainment worth $76 billion by 2011

The mobile entertainment industry, if actualized, could reach a potential of $76 billion by the year 2011, a recent study conducted by technology market analysts Juniper Research claims. Made up of music, games, TV, and sports, the entertainment business via mobile phones has a set stage for an explosion of mobile entertainment in the coming years.

“The face of mobile entertainment is expected to change significantly over the next five years as next generation mobile services continue to be rolled out around the globe and take up steadily increases,” said Juniper Research Mobile Entertainment principal author Bruce Gibson in a company press release.

This mobile entertainment industry could reach the $76 billion mark, up from $17.3 billion in 2006. One of the main reasons for the potential boom is the current wave of third generation networks, which offer the bandwith to support mobile entertainment . Other factors include the rise of mobile video feeds and live mobile TV. Supplemented by a growing market in Asia, the mobile entertainment industry could grow along with it.

Juniper Research warns opening up a Pandora’s box for perturbed mobile users. The possibility for the monetization may be eclipsed by possible pitfalls such as gambling or pornography. These two factors alone could impinge on the successes of this untapped market.

“Whilst the potential to generate dramatically increased revenues is certainly there, many uncertainties affecting sections of the market still exist and could put a break on growth – the development of legislative environments for mobile gambling and adult content, and the success of broadcast mobile TV trails currently underway or planned, are just two examples,” said Gibson.

Mobile social networks worth $13.1 billion by 2011

Red Herring (04.16.07) reported that according to London-based Informa Telecon and Media mobile communities and user generated content (often bracketed together as social networking) will be worth $13.1 billion by 2011.

Mobile content to reach $43 billion by 2010

The global market for mobile phone premium content will exceed US$43 billion by 2010, according to a new study by iSuppli. This compares to the figure in 2004 which barely reached US$5.2 billion. Over the next four years, the market for such extra mobile services as music, gaming and video will expand at an annual rate of 42% argues the US-based research company.
According to Mark Kirstein, vice president of multimedia services and content for iSuppli, "After years of hyper growth, mobile phone markets in several major regions around the world are maturing, resulting in slower subscriber growth and declining average revenue per user for carriers. Meanwhile, new 3G networks offer increased bandwidth, but require compelling applications and content to drive revenue and provide a return on investment to operators. Against this backdrop, mobile-service carriers and content providers are establishing new business models to capture the growing opportunity."
The company believes that the main driver of premium mobile content services will be music, led by ring tones and ring tunes. iSuppli believes that this market alone was worth US$3.8 billion in 2004 and grew very quickly last year as the industry made a major transition from traditional polyphonic ring tones to ring tunes. Coming a close second in terms of growing popularity is mobile gaming, which the company believes grew by 80% in revenue terms last year. However, mobile video is seen as the best long term bet for expanding premium content services, even though the market for such services is still in its infancy.
The company argues that the success of mobile TV depends entirely on new phone deployments. According to iSuppli even with reasonably strong adoption of mobile-TV technology and subscribers, the installed base of TV-capable phones will only represent 12% of the total by 2010.

Braodband satellite industry revenues to increase at an average annual rate of 11 percent during next five years !!

According to Northern Sky Research Ltd. (NSR), service revenue for the broadband satellite industry will increase on a global basis at an average annual rate of more than 11 percent during the next five years, with the fastest growth coming for consumer-class satellite broadband Internet access services like North America's WildBlue and HughesNet.
Broadband satellite Internet services and satellite IP trunking are experiencing rapid subscriber growth, which in turn translates into greater service revenue. In addition, single-site satellite broadband services have had success in markets outside of North America, like Thailand and Australia, and new service launches in Europe and possibly elsewhere in the world will help to generate service revenue growth in excess of 22 percent per year through 2011.
Service revenue from the IP trunking segment actually will decline on a global basis as demand for trunking continues to shift from satellite to undersea cable and fiber, the group says, though some regional markets like Africa will see positive gains in the coming years as demand continues to grow in specific countries.
Solid, steady growth in classic enterprise & SME broadband VSAT services along with continued growth in shared-hub and managed services in most regions of the world will enable service revenue to increase at a steady rate through 2011. In addition, increasingly fat bandwidth pipes for existing broadband VSAT networks will increase service revenues as companies take advantage of standardization to carry on adding additional IP-based applications to their enterprise networks.
Turning to customer premise equipment (CPE) sales, total CPE revenue for the entire market are forecast to remain in the $400 million-$500 million range per year through 2011. The declining CPE cost will be one of the key factors in driving up subscriber uptake for single site satellite broadband Internet access services and will push growth in the enterprise & SME broadband VSAT networking segment as well.
Another trend in the enterprise & SME segment is that better performance is being obtained in CPEs of lower or the same price. This is especially true as bandwidth-saving technologies like DVB-S2 and Adaptive Coding & Modulation are adopted and ever-smaller broadband VSAT networks become financially viable.
The majority of CPE revenues are generated in the enterprise & SME broadband VSAT networking segment. "Interestingly, NSR even forecasts CPE revenues to decline substantially in a number of regional markets. Again, this is a positive sign that does not point to slowing demand for services but a lowering of one of the important cost barriers to broadband satellite services uptake" - as per the report.

Oiling the rural connectivity - Idea Cellular uses biodiesel to fuel its BTS's power !

Indian mobile operator Idea Cellular, in an attempt to bring cellular phone service to remote areas where the electric supply is at best spotty, has begun installing mobile base stations powered by fish oil and used frying oil from local restaurants. It's believed to be the first time in the world that biofuel has powered a cell phone installation.
The oil is processed locally into biodiesel fuel and used to fuel the generators that power the base stations. So far four base stations have been installed in the Indian state of Maharashtra by Ericsson for Idea, using a grant from the GSM Association's Development Fund. The four sites were described by Ericsson as "greenfield sites that have not previously had access to a mobile network and are located in areas with unreliable power supply."

Exploring alternative power solutions, such as biofuels, is key to the development of cost-effective ways to extend mobile networks to the 20 percent of the world's population that don't have coverage today. The three companies pointed out that an important factor is that the biofuel is produced locally, creating employment in rural areas while reducing the need for transportation. Biodiesel has a much lower impact on the environment than conventional diesel, they also pointed out. The cleaner burning renewable fuel also requires fewer site visits and also extends the life of the base station generator, reducing operator costs, according to the companies.

The use of fish and cooking oil, while novel and undoubtedly an interesting recycling technique, is only temporary. Eventually the biodiesel for the cellular base stations is going to come from oil made from the seeds of the Jatropha Curcas, a tree being widely promoted worldwide as a biofuel source. That tree is said to yield four times as much biofuel as soybeans for a given size piece of land, and about half as much as highly cultivated corn. Unlike corn, though, Jathropha will grow in wastelands. India has been pushing use of Jathropha in a huge range of applications, from the biodiesel fueling the cellular base stations to use of a Jathropha extract as an anti-constipation medicine. According to an article in Wikipedia, the rail line between Mumbai and Delhi is planted with Jatropha and the train itself runs on 15-20 percent biodiesel.

Saudi Arabia's Cellular operator 'Hits' planning to create a pan-African network!

Saudi Arabia cellular carrier Hits has set up an African subsidiary funded with $1 billion and chartered to attempt to create a pan-Africa company operating across eight countries by 2012.
The new unit - Hits Africa - starts out life with a controlling stake in Liberian mobile operator Liberiacel, to soon be renamed Hits Liberia; Hits bought the Liberia property in March. The company reportedly is on the verge of receiving licenses in the Democratic Republic of Congo and Tanzania, and it says it is seeking more in at least four other countries, reportedly including Nigeria, Niger, Burundi and Ethiopia. Hits' goal is said to be to create the "first African converged player" with between 4 million and 6 million subscribers within five years.
The new African unit of Hits reportedly already has put together the team it expects to use to build its African empire. That group starts with China's Huawei, which apparently will provide the wireless network hardware. Others chosen include Devoe Team, a French company specializing in technical project management solutions; project management company MCM of Singapore; and telecom legal consultant Squire Sanders.

Mobile WiMax will connect 8 percent of world's 1.1 billion mobile broadband subscribers by 2012 !!!

According to new research from Parks Associates - Mobile WiMax will connect 8 percent of the world's 1.1 billion mobile broadband subscribers by 2012, accounting for nearly 88 million users worldwide, The firm also forecasts 52 percent of these subscribers will be from Asian countries, while North and South America will account for another 28 percent.
Today, most existing WiMAX deployments are the province of aspiring start-up service providers or incumbent telecom carriers looking to fill coverage gaps. The imminent availability of commercial products and increasing availability of spectrum around the world will change the market for Mobile WiMAX and make it viable among major service providers. Taiwan alone will have 8 million Mobile WiMAX subscribers by 2012.
Approximately 160 million cellular subscribers (6 percent of all cellular subscribers) were using a mobile broadband service at the end of 2006, Parks adds. Two-thirds of these mobile broadband subscribers used UMTS technology, and the remainder used CDMA EV-DO.
"Both Mobile WiMAX and UMTS/HSDPA technologies will gain market share in the next several years, at the expense of CDMA EVDO," Cai says. "TD-SCDMA will also have a meaningful market share due to its strong foothold in China, the largest mobile market in the world."

Mobile handset accessories will generate $80 billions of revenues by 2012!!

According to ABI Research - The market for mobile-phone accessories will generate more than $32 billion in revenues this year, more than the $28 billion expected from the smartphone market.
Some 77 percent of these revenues will come from the sales of "after-market" accessories and the remaining from "in-box" accessories shipments. The firm expects the market for handset accessories to grow steadily in the next five years, generating more than $80 billion in revenues in 2012.
Handset vendors and mobile operators are showing greater interest as accessories provide high margins and also opportunities to promote their brand and expand their product offerings. The growing interest among mobile operators is also driven by the realization that mobile phone accessories can lead to higher ARPUs.
Handset vendors now recognize that to increase sales of their high-end wireless handsets and smartphones, they need to provide accessories that allow users to fully enjoy and benefit from the features provided in those handsets. Nokia is addressing the handset accessory market with a distinctive approach of "mobile enhancement" products, while
Motorola is playing special emphasis on the growing "personalization" and "self-expression" trends.

Average American cell phone user keeps his handset for 17.5 months!!

According to a new study by J.D. Power and Associates, the average cellular phone user is keeping his handset 17.5 months, longer than has been the case in the past. The length of ownership is up from 16.6 months in just half a year - the consumer survey house's last reporting period was November. While the difference may not seem that great, it is the first increase in average ownership spotted by J.D. Power since way back in 2002, when the average length of ownership was 18.4 months.

"One possible reason for this significant increase in the length of handset ownership is that more customers are initiating or renewing their service contracts for a longer period -- typically for two years, as opposed to just one year, which was customary a few years ago," said Kirk Parsons, senior director of wireless services at J.D. Power.
Parsons also warned that the increasing length of ownership may be a double-edged sword for carrier. "While these longer contracts help wireless carriers recover the costs associated with offering subsidized cell phones, customers tend to hold on to their current cell phones longer to avoid termination fees when switching service, which may ultimately lead to lower renewal rates," he said.

In addition to keeping phones longer, the J.D. Power study also documents a continued decline in the amount American consumers pay for their handsets, a total it said has declined from an average of $103 in 2002 to $93 this year. And 36 percent of those surveyed - 21,520 cellphone users who had their phones for two years or less - said they got their handset for free, up from 28 percent five years ago.
"It's clear that wireless service carriers are using mobile phones as bait to increase consumer traffic, applying discounts either through rebates or free limited-time offers," said Parsons. Again, though, he had a warning: "The problem with this strategy is that, in most cases, the discounted handsets being offered are older models, which typically lack the latest technological advancements or desired design features."

Other findings of interest in the J.D. Power study included:
>>69 percent of all cell phones owned are a clamshell design, an increase of 19 percent from last year. That compares to 29 percent for the candy-bar style, and 2 percent for the slide-cover design.
>>Handset features used most frequently are: Speakerphone (51 percent); camera (35 percent); services to send/receive short messages (22 percent); and gaming (16 percent).
>>More than one-half of all current wireless users compared other handset brands before selecting their current wireless phone. Those customers who compare phones during the selection process are more likely to be satisfied overall with their current handset than those who do not.

Idea weds Spice - How ? Remains to be answered

Idea Cellular and Spice Telecom along with Telekom Malaysia (TM) that holds 49% stake in Spice, are yet to work out an amicable arrangement between the deal between the two - Merger or acquisition. While Idea, in which the Birlas own 57% stake, wants to fully acquire Spice, the Modis-promoted company is keen for a merger.

Spice has 2.8 million subscribers, largely high-end, in Punjab and Karnataka circles where Idea is not yet present. Idea, which listed on the bourses in March this year, has grown through the organic as well as the inorganic route in the past. While an acquisition of Spice will give Idea a ready entry into two new circles and a good user base, the Birlas are not willing to pay over the top. Spice is said to be quoting a price of more than a billion dollars for the two-circle operation, to which the Birlas are not agreeing. “We are a fast-growing company and our valuation is definitely higher than a billion dollar,” a Spice executive said. However, going by the fact that promoters of Spice will offload 20% stake in the forthcoming IPO for $150 million, the company’s valuation is $750 million. This remains a bone of contention between the two sides. Idea will continue to be an AV Birla group company going forward and there was no question of the company diluting its identity in a merger. Also, a buy-out of Idea by Spice seems unlikely because Idea is seven times bigger than Spice. AV Birla group officials have earlier said the group will not dilute its stake in Idea below 51%.

Meanwhile, TM has clearly said that it will not exit the Indian market, TM bought 49% stake in Spice in March last year for $179 million. Spice applied for spectrum in 20 circles in September last year. It has already received the DoT nod for NLD and ILD operations. It is too early for the deal to come through as Spice was working on its IPO ahead of any agreement. Sebi has given its approval to the public offering. “We should be opening in the end of June. However, an acquisition after the listing of Spice will become more complicated due to regulatory issues. For the year 2006, Spice recorded revenue of Rs 533.78 crore and EBITDA of Rs 107.86 crore. Its EBITDA margin fell from 23.8% to 20.2% at the end of 2006. The company’s capital expenditure at the end of last year totalled Rs 269 crore.

VSNL rolls out WiMax services in Bangalore

The Tata-owned Videsh Sanchar Nigam (VSNL) has rolled out WiMax services in India. To begin with, the global communications company will offer the services to enterprise customers in Bangalore. VSNL will extend its WiMax network to about 120 cities across India for enterprise customers and in five cities for retail customers by the end of this financial year. A number of companies from sectors like retail, financial services and automobiles are using VSNL’s Wimax services. VSNL has launched WiMax after conducting pilots in Bangalore and other locations VSNL is also the leader in the Wi-Fi space, with nearly 300 public hotspots in India. Among operators, Bharat Sanchar Nigam (BSNL) is also planning to launch WiMax services very soon, having undertaken pilots at 14 locations. While Motorola as well as Nortel are offering equipment for WiMax, Alcatel-Lucent has completed the country’s first live WiMax field trial using Aircel’s licensed spectrum. WiMax also allows applications in moving conditions such as video streaming, high-speed file downloads, voice over IP and web browsing.

Record growth of mobile customers in China; Pakistan market also booming

Net additions of mobile customers in China in April 2007 topped 6.9m, breaking the record of 6.8m set just a month ago in March. 2007 has clearly been the strongest year ever in the Chinese market, so far at least, with a total of 26.3m new connections being added in the first four months of the year, against 21.9m over the same period in 2006, 18.6m in 2005 and 20.7m in 2004.
The total customer base in China grew to 469.8m at the end of April, with all but 38.5m of these being connected through GSM networks. Whilst the proportionate growth rate declined very marginally between March and April from 1.494% to 1.493%, these are the highest monthly rates that have been seen in the market since December 2004.
Of the 6.9m net additions, 5.27m were accounted for by China Mobile - 76.3% of the total, up from 75.2% in March. This was an improvement for the world's largest operator, but it should be noted that its share of the total in March 2007 was the lowest recorded since August 2005. That said, for the last two and a half years, China Mobile's share of net additions has been consistently ahead of its share of the total customer base, ensuring a continuous improvement in market share. The trends were no different in April 2007, China Mobile gaining another 0.1pp at China Unicom's expense, taking its total share to 68.1%.

On the other hand, Pakistan has already added 10 Million New Customers in 2007
Almost 2.8m new mobile customers joined the ranks in Pakistan in the month of April - the second highest total ever recorded in the market, behind October 2006. Monthly proportionate growth stayed above 5% by a whisker, after 5.1% in March, taking the total customer base in the market to 58.4m and penetration to 34.7% from 33.0% a month earlier. A total of 10.0m new customers were added in the first four months of 2007, these being shared almost equally between the market's four largest operators.
Telenor garnered the biggest portion, with 3m or 30% of the total, ahead of Mobilink (27%), Ufone (25%) and Warid Telecom (21%).

Despite its overall lead in terms of net additions so far this year, Telenor slipped back in April, recording the lowest number of net additions of the big four. Close competitor Warid Telecom itself recorded a market-best 8.5% increase in customer numbers in April, meaning that it overtook Telenor again for third spot in the market, having lost this position for a brief while in March. In absolute terms Pakistan Telecom's Ufone was the best performer in April, adding 0.89m customers, or 32% of the monthly total. The net result was a gain of 0.5pp of market share for Ufone, 0.4pp for Warid and 0.2pp for Telenor, whilst market leader Mobilink gave up a further 1.1pp reducing its overall share to 43.2%.
Mobilink did break the 25m customer barrier during the month, however, becoming only the 11th Asian mobile company to do so, after China Mobile, China Unicom, NTT DoCoMo, KDDI, Telkomsel, Bharti, Reliance, BSNL, Hutch and PLDT.

MVNOs are here to stay and grow

A new report published by BroadGroup Tariff Services suggests that MVNOs will continue to grow on a global basis ? with worldwide subscriber numbers more than doubling for the period from 2007 to 2012.

However the report warns that business models and distribution will need to change.
The research reveals a wide range of different approaches and market drivers. The mobile market globally is becoming more fragmented with the power of brands and distribution ? together with the emergence of new low-cost MVNE aggregators ? favouring the development of emerging niche MVNOs based on a small social community.
Retailers and non-telecoms companies with strong customer relationships are using the MVNO model as a marketing tool to broaden and improve their existing customer experience to improve customer retention for their core business.
The distinction between pure MVNO and pure MNO is likely to become increasingly difficult to sustain as the MNO is utilising the MVNO technique of sub-brands or multi-brands to retain loyal customers... As the larger MVNOs grow their subscriber base they also seek to develop a post-paid business stream and are adopting the characteristics of the MNO.
"The MVNO model is perceived as a perfect low cost entry vehicle to launch new mobile business models," commented Margrit Sessions, Managing Director of BroadGroup Tariff Services. "MVNOs can help lower prices in a market but purely competing on price can not be sustained as a long-term strategy. Developing new business models and distribution will be key to success".

Vodafone directors resigns from Bharti Airtel's Board

The two Vodafone directors on the Board of Bharti Airtel have left the company following its takeover of Hutch-Essar. Bharti Airtel chairman and managing director Sunil Mittal said that both the directors - Gavin Darby and Paul Donovan - have resigned. In January, the Vodafone directors had abstained from the Board meeting when Vodafone started its pursuit of Hutchison Telecom's stake in Hutch-Essar.

Bharti Airtel has also announced that it has crossed the 40 million-mobile customer milestone. With this, Bharti Airtel becomes the first Indian mobile services provider and it says, the 10th in the world to join an exclusive list of global telecom operators with more than 40 million customers from a single-country.
It took Airtel 11 years to reach the 20 million customer landmark and just another 13 months to add the next 20 million customers. The Company's overall wireless market share catapulted to over 23.2% as of April 2007 from 20.4% as reported in FY06.

Currently, Airtel is present in nearly 4,700 census towns and over 200,000 non-census towns and villages covering 59% of the country's population. The company plans to aggressively roll out more than 30,000 cell sites in FY08 to increase its population coverage to 70%."

Wimax subscriber base grew by 85% in 2007

According to research firm Maravedis, increased global deployments of WiMAX technology has lead to an 85% spike in subscribers and a corresponding growth in service revenue . The main findings of research are -

* 52% of the deployments still used proprietary equipment, 36% applied the 802.16-2004 standard, and 12% applied wave 1 802.16-2005 standard.
* United States, Spain and Australia were the top 3 countries in number of subscribers. In Q1 2007, they accounted for 0.5 million BWA/WiMAX subscribers.
* APAC accounted for 38% of deployments, Europe 33%, North America 17%, and CALA 13%.
WiMAX service revenues in 2006 totaled US$322 million, with recorded ARPUs of US$40.76 and US$145.54 for residential and business subscribers, respectively.
* The split by subscriber type operators was 58% residential and 42% business.
APAC operators offer higher speeds compared to other regions, yet APAC has the lowest ARPU at US$30.45 for residential.
*The price difference between WiMAX and DSL tends to be narrow, which tends to negate price as a factor for potential customers.

WiMAX market in India is warming up!

Reliance Communications (RCOM) is all set to launch its wireless broadband technology commonly known as WiMax in Pune and Bangalore in June. After assessing the market response, the company will extend the WiMax service to other cities such as Hyderabad, Chennai, Mumbai, Chandigarh and Delhi. The move that targets the three million wireless internet users in the country, is expected to give first-mover advantage to the company. It is said that Bharti Airtel, VSNL and BSNL have also tested the new technology and planning to roll out in the near future. In India, WiMax has been launched by Aircel Cellular in Chennai for business customers.

The news comes when the global WiMax Forum has sought the Indian government’s support in its endeavour towards getting the International Telecommunication Union (ITU) to include WiMax as part of International Mobile Communications – 2000 (IMT-2000) standards. The Indian cellular operators have, however, opposed the move and said that the DoT must not support the forum’s proposal until further details such as compatibility and interference issues with regard to WiMax are available. IMT-2000 is the global standard for third generation (3G) wireless communications as defined by the International Telecommunication Union. It has defined five standards which are followed globally for 3G services. In January 2007, a proposed sixth standard (WiMax) was submitted into ITU by the Institute of Electrical and Electronics Engineers (IEEE) and supported by the WiMax Forum.

VoIP revenues in North America to increase by 1431% by 2009 !

according to an Infonetics Research report , Voice-over-IP service revenues are poised for phenomenal growth in North America . That report predicts a growth rate of 1431% for VoIP service revenues, as they increase from $1.3 billion in 2004 to $19.9 billion in 2009.
That increase is predicted despite the fact that most businesses recently surveyed by Infonetics expect to provide their own VoIP, using a service provider pipe and premises-based VoIP gear.
VoIP revenues in 2004 represented less than 1% of total wireline carrier revenue.

Many service providers are still trying to figure out how to structure their hosted voice offerings, as well as how to bill for, manage and secure VoIP services. Particularly in courting business VoIP customers, service providers have to develop a mix of offerings that takes into account both hosted services and managed IP-PBX offerings. Service providers must be able to mix and manage customer premises solutions with hosting solutions even for one customer, since a business often has small offices that need a hosted solution, but also need the same feature set as the premises solution at corporate headquarters.
Service providers also are trying to sort out what falls into the flat-rate “all you can eat” category of voice service and what advanced features will generate badly needed revenue or create competitive differentiation.
Single office/home office (SOHO) users will be a major growth category for VoIP, the report predicts, growing from 1.1 million in 2004 to 20.8 million in 2008. Business-hosted VoIP service revenue is getting off to a slower start than that of managed IP-PBX services, but is expected to overtake those revenues by 2006 due to significant growth in the small to mid-sized market, according to Infonetics.

Fight for the scarce resource - "THE SPECTRUM"

Entry of Foriegn players in offering 3G mobile services
As per reports in economic times - A committee of Department of Telecom is said to have given its clearance on entry of foreign players in offering 3G mobile services and allocation of spectrum through auction. The group is said to have so far finalised two things -- that 3G is not an extension of 2G, implying that there is price to be paid through auction for spectrum to start 3G services, and entry of foreign players. Other issues including allocation of spectrum to public sector undertakings and pricing criteria are also being worked out.

At a time when voice revenues are falling, high-end value added services through 3G hold big potential for telcos to arrest the top line fall. The report indicated that the final policy is not likely to come out before July as lots of nitty-gritties have to be worked out along the broad framework of 3G, including allocation, auction methodology, benchmark price, number of players, PSUs (BSNL and MTNL) entitlements as per their existing rights. The sources said being PSUs, BSNL and MTNL will be given preference as unless supported they would not be able to compete and offer 3G services on their own. The PSUs will have pay some price for the spectrum to remain in the allocation benchmark, they said. Entry of foreign players will bring in competition and quality which would bring down the cost and make 3G services popular.

Meanwhile Tata Teleservices is opposing entry of foreign players in offering 3G services. Tata Teleservices feels this would lead to scarcity of spectrum and hamper the growth of existing operators and has demanded a level-playing field vis-a-vis foreign players.

Mandatory network sharing for roaming
Meanwhile, The Department of Telecom (DoT) plans to make it mandatory for all operators to open their networks to roaming customers from other service providers after the introduction of third generation (3G) telecom services in India. If implemented, private cellular operators will be largest beneficiaries as they will be roam on the extensive networks of state-owned BSNL. This proposal will also enable 3G subscribers to roam on the existing 2G networks. The move has been recommended by the internal committee of DoT, which is studying telecom regulator’s Trai recommendations on the allotment and pricing of 3G spectrum. The logic behind the DoT proposal is that “besides existing GSM and CDMA players, non-telecom companies and even non-Indian companies” will bid for 3G spectrum, when it is made available. As the constraint of 3G spectrum will limit the number of players in this sector, and since it will also not be possible for these players to roll-out these services on a pan-India basis, their customers will therefore have to depend on the 2G networks of existing operators when on roaming, the DoT committee has said. “In view of the limited number of service providers being recommended for 3G services and the fact that the extensive, country wide roll-out of 3G networks will take a reasonably long time, the 3G customers will have to depend on 2G networks and services in areas where 3G services are not available, or on 3G networks of other operators, wherever available for such time. Hence roaming amongst all service providers would be required and is therefore recommended to be mandated,” the DoT’s committee report said. Currently, all private operators share their network infrastructure and allow their customers to roam on the networks of competing service providers. The DoT committee recommendation gives private operators reasons to cheer as BSNL is the only telecom operator in India which does not share its infrastructure. In fact, many private operators have also demanded that the incumbent be mandated to share its nation-wide network created largely with public funds, on reasonable and non-discriminatory terms, adding that the terms of such sharing be regulated by Trai. The regulator has also been advocating the move. The Department of Telecom committee has also endorsed most of Trai’s recommendations on the allotment of 3G spectrum. While approving of Trai’s proposal that 3G spectrum be made available in the 2.l Ghz and 800 Mhz (for CDMA), it has however said that the availability of the 450 Mhz would be difficult. With just over 40 Mhz of 3G spectrum slated to be vacated by the defence forces, the committee has recommended that the allocation of the resource be limited to just four players, through a bidding process. Additionally, it has also recommended that ‘for security reasons, one slot of 3G spectrum be reserved for BSNL and MTNL’ during its allocation, where the PSUs will have to pay the price quoted by the second highest bidder during the auction process.

Limiting the number of operators to ensure spectrum availability
At this point of time the Indian telecom space is hit by the unavailability of spectrum. The Department of Telecom is said to be now considering to limit the number of operators in each service area to maintain a minimum quality of service. The step was necessary as "spectrum is a scarce resource and to ensure that the adequate quantity of spectrum is available to the licensees to enable them to expand their services and maintain the minimum quality of service." There are 23 telecom circles in the country. Currently, there is no cap on the number of service providers in a service area. As on date, 159 licenses have been issued for providing access services in the country and generally there are 5-8 providers in each service area. Since any Indian company can apply for unified access license, this is increasing the demand for spectrum in a substantial manner. In an evolving sector like telecom to ensure that the policies keep pace with the changes, DoT is seeking TRAI's recommendations on the issue of limiting the number of Access Providers in each service area. The Department is considering to review the whole set of crucial guidelines in the terms and conditions of access providers (cellular/unified access/basic) licenses. The terms and conditions slated to be reviewed are "substantial equity holding by a company/legal person in more than one license company in the same service areas, transfer of license and merger and acquisition guidelines." Besides, other guidelines like permitting service providers to offer access services using combination of technologies (CDMA/GSM and or any other) under the same license, roll-out obligations and requirement to publish printed telephone directory will also be reviewed. TRAI's decision could also decide the fate of Reliance Communications which is aspiring to enter the GSM space in a pan India presence and has thus applied for spectrum. As per DoT norms, no single company can have more than 10 per cent stake in two different cellular operators in the same circle. The guidelines also deal with market dominance and stipulate that the total market share of the combined entity cannot exceed 67 per cent in any circle.

Rajya Sabha MP and former owner of BPL Mobile, Rajeev Chandrasekhar, has joined the ongoing battle between the government and telecom operators regarding the allotment and pricing of 3G spectrum. In a communication to Prime Minister Manmohan Singh, Mr Chandrasekhar said that that the Department of Telecommunications’ (DoT) plans to allow foreign and non-telecom players to bid for 3G spectrum through an auction process must not be held hostage by Indian telecom companies. Mr Chandrasekhar’s communication comes as Tata Teleservices and GSM operators have expressed concern over DoT plans to allow foreign players to bid for 3G spectrum and said that “the existing 2G players must have the have the first right to use 3G spectrum as and when it is made available for allotment”. Mr Chandrasekhar is not a disinterested party. He is planning to bid for 3G spectrum in some metros, and will be prevented from doing so if the government bans non-telecom Indian players from participating in the auction. He has also pointed out that there were no restrictions on fourth round of cellular licenses and the recent FM licenses, while adding that restricting bidders would depress the real value of spectrum. Tata Teleservices, in its communication to DoT had alleged that the Centre was ‘disregarding the recommendations of Trai for facilitating the progress of existing GSM and CDMA operators from 2G to 3G services’. “At a minimum, we would expect that the issue of entry of new players, especially from overseas markets to be discussed openly. The interests of existing telecom licence holders who have done so much to make India the fastest telecom market in the world must be protected and a level-playing field provided to them,” the company had said.

Amid the ongoing debate over the entry of foreign players in 3G mobile services and opposition to this idea by domestic players, officials of Tata Teleservices, Bharti Airtel and Cellular Operators Association of India on Thursday met Telecom Secretary D S Mathur.
Sunil Mittal, CMD, Bharti group told the media, "My only point is existing players should get enough spectrum. We all know there is scarcity of 2G (voice spectrum)."
Former telecom minister Dayannidhi Maran had said foreign players should be considered to offer 3G services to bring in quality and comeptition. However, domestic players have opposed this proposal.

Who has got the right on spectrum - GSM v/s CDMA operators
In the fight for the spectrum, Cellular Operators Association of India has said CDMA players should be granted GSM spectrum only after the needs of the cellular service providers (GSM) have been fully met and secured.
Leading CDMA player Reliance Communications has applied for GSM spectrum to expand its mobile services in the country.
Both policy and regulation emphasize adequate availability of spectrum for existing service providers before considering the needs of new players, the COAI said in an approach paper on allocation 2G spectrum (voice).
It further said as the government is in the process of vacating spectrum in the 1800 MHz band to meet the additional spectrum requirements of GSM licensees, it is important to arrive at an equitable approach on how this additional spectrum be allotted among various service providers.
The requirements of CDMA service providers are met through spectrum in the 800 MHz band and when they migrated to UASL from fixed/WLL(M) licenses, it was on the understanding that they would provide the service in their already allotted spectrum and no additional spectrum will be given.
All the GSM licensees who are in commercial operations will come into the category of existing licensees and their spectrum requirements must be safeguarded up to at least 2x15 MHz before any subsequent licensee is considered, it said.

With the government expected to soon take a decision on the allotment of 2G spectrum for Reliance Communication’s GSM foray, existing GSM players have approached the Department of Telecom (DoT) demanding that allocation of this resource be prioritised. GSM players have said that despite the licence being technology neutral, they should have the first right to 2G spectrum as and when it is available. Besides, a GSM player who wants to expand operations to pan-India level should be given priority over new entrant Reliance Communications, they said. Last year, RCOM, which currently offers GSM services in eight circles, had applied for GSM spectrum on a pan-India basis. The company is also learnt to have floated a mega GSM tender estimated at over $6 billion. Recently, announcing the results for the year ended March 2007, chairman Anil Ambani had said that RCOM would roll out GSM services across the country within a year of spectrum being allotted. Opposing the move, the Cellular Operators Association of India (COAI), the body representing all GSM technology-based operators, had told DoT that telecom regulator Trai, during its earlier recommendations, had said that ‘additional spectrum, if available, should be given to existing operators for cost effective service. Quoting Trai, COAI said a fair balance between the two objectives of increasing competition on one hand and improving quality, coverage and price-efficiency of service on the other, has to be maintained so that the larger objective of providing quality services at affordable prices is not jeopardised. COAI also added that if new entrants were allocated GSM spectrum, at the expense of existing operators, then this will lead to ‘a sub-optimal cost structure and quality of service, which in turn will be detrimental to the growth of teledensity’. According to the GSM body, currently, the paucity of adequate spectrum for existing licensees have resulted in serious ‘quality of service’ issues, which have been highlighted by the regulator from time to time. Trai in its study papers have repeatedly said that spectrum shortage faced by operators was affecting the service quality. “Given that both policy and regulations emphasise on adequate availability of spectrum for existing service providers before considering the needs of new players, it is submitted that in the event that any CDMA licensee seeks an allotment of GSM spectrum, he will be able to get the same only after the needs of the GSM providers have been fully met and secured,” COAI said.

RCOM, Tata Teleservices and other CDMA operators have approached telecom tribunal TDSAT, seeking refund from the government of the excess fee charged during 2003-06 due to late implementation of the revenue sharing regime in allocation of spectrum. Accepting a petition by RCOM and CDMA body Association of Unified Telecom Service Providers of India, TDSAT chairman Justice Arun Kumar issued notices to the DoT and directed it to file a reply within four weeks. In the petition, the operators requested the tribunal to direct DoT to charge them for allocation of microwaves on revenue share basis from 2002 when the Unified Access Service License regime was implemented. AUSPI and Reliance in the petition also urged that spectrum charges should be taken from the date of commercial operations of telecom companies and not from the date of allocation of microwave. During proceedings, counsel Ramji Srinivasan, appearing for the operators, contended that after UASL implementation in 2002, DoT had assured them it would take spectrum charges on revenue share basis.

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