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.

Growth in Indian rural tele-density not an easy task - says E & Y !

Research firm Ernst & Young (E&Y) has said while the government and private operators continue to push for rural telephony, its proliferation in the hinterland will be faced with many challenges. “The cost of delivery is likely to be high in view of the specifics of the Indian reality. Hence, connecting rural India would mean incurring a much higher cost per subscriber to capture low ARPU subscribers,” said E&Y telecom industry practice leader Prashant Singhal.

Telecom operators may be banking big time on the untapped rural markets for the next wave of growth, but the number of connections in hinterlands will not increase beyond 150 million by 2011, according to a study. “Mobile connections in rural geographies will be constrained by coverage of network infrastructure and affordability of handsets which will limit consumption,” London-based Centre for Telecoms Research (CTR) has said. The government has set a target of 500 million cellular connections by 2010 and DoT expects a fifth of these will be in rural areas. While operators are rolling out extremely low-cost handsets, industry analysts feel driving usage in rural areas will not be easy. Network management itself remains a challenge in the difficult terrains and this is topped with erratic power supply leading to high genset costs. The main stumbling block in rural areas is the high cost of building infrastructure versus low revenue opportunity. However, government initiatives like the Universal Service Obligation fund (USOF), shared infrastructure and managed network services would help to address these issues. All operators contribute 5% of their revenues to the USOF, used to provide rural telephony. Recently, the government has finalised contracts for setting up 8,000 towers in rural India with support from USOF. This is expected to help the government in providing an additional 50m connections in rural India. Currently, the rural teledensity is nearly 2% while urban teledensity is over 40%. This hyper growth in urban areas will also make things difficult for operators going forward. The CTR study expects urban populations of India to reach high levels of mobile phone saturation in the next five years, to the extent where many phone users will have two or more handset connections. A large portion of this growth will arise from pre-paid connections, driven by the increasing affordability of handsets and tariffs amongst India’s lower middle classes. “The phenomenal growth in the Indian mobile phone market has largely been driven by urban consumption. We expect this to continue with urban geographies achieving saturation levels similar to current Western European markets in the next five years,” said CTR research director Raj Modi.

Battle at cable landing stations

While international telecom majors such as AT&T, BT, France Telecom, Verizon, Cable & Wireless, the Asia Pacific Carriers’ Coalition and domestic players such as Bharti and Reliance Communications have endorsed telecom regulator Trai’s proposal that cable landing stations (CLS) in India be opened up, and regulations be enacted to mandate access for all players to existing CLS facilities, VSNL, part of the Tata Group, has opposed the move. It’s a confrontation between the incumbent and entrants. According to industry estimates, the mandatory sharing of cable landing stations, coupled with allowing the resale of international bandwidth in the country will help to reduce bandwidth rates by 40%. If Trai issues final recommendations as per its current proposal, and if this were to be accepted by the government, then international submarine cables coming into India and new cables being built by operators here will be access the cable landing stations (CLS) of BSNL, Bharti, VSNL and Reliance Communications. International majors such as AT&T, BT, Cable and Wireless and Verizon, Orange Business Services (France Telecom) all of which have already launched, or in the process of starting long distance services in India have also told Trai that regulating this segment is in line with international practices.

"With new ILD operators coming into the market in India, it is important that they are able to get timely and equal access to the CLS, in order to be able to efficiently use the international capacity which they either own or have leased on a long-term basis,” Cable & Wireless said. The company has also pointed out that there has already been one high-profile dispute relating to access to cable-landing stations in India, adding that the publication of fair and transparent terms for CLS access and co-location should avoid such protracted disputes in the future and ensure that all operators can compete on a level-playing field.

The dispute in question was between Reliance-owned Flag and VSNL, with the latter dragging the Tatas-owned company to the International Chamber of Commerce’s Arbitration Tribunal seeking monetary relief over VSNL’s failure to share the Mumbai landing station. On the other hand, the incumbent VSNL has told Trai that access to the essential facilities and co-location at cable landing stations “should be voluntary... and no exante regulation should be resorted to”.

Hutch Essar may soon be no. 2 GSM operator - ready to over take BSNL

In April, the cellular subscriber base of Bharti touched 3.88 crore with additions of 17.51 lakh users, followed by BSNL at 2.77 crore with a market share of 22.10 per cent and additions of 3.26 lakh subscribers.
Hutch-Essar has 2.77 crore subscribers, taking its market share to 22.06 per cent and Idea with a market share of 11.60 per cent has 1.45 crore subscribers in April.
Hutch-Essar added 12.61 lakh subscribers in the month of April(against 3.26 of BSNL), while Idea added 5.52 lakh mobile users in the same month. If trend continues , by May end Hutch will over take BSNL as no 2 GSM operator.

Sustaining its aggressive growth in subscriber additions, the GSM-based cellular industry has added over 41 lakh subscribers in April with Bharti Airtel capturing 30.97 per cent of the market share.
With this, the all-India GSM subscriber base has touched 12.55 crore at the end of April 2007 compared to 12.14 crore at the end of March 2007, reflecting a growth rate of 3.40 per cent, the Cellular Operators Association of India (COAI) said in a statement.
CDMA mobile figures are yet to be out.
MTNL's GSM subscriber base in Delhi and Mumbai touched 24.83 lakh, while Spice Telecom has over 28 lakh subscribers.
Aircel's user base in April stood at 59.27 lakh, followed by Reliance Telecom's 43.47 lakh subscribers.
Advertiser-funded content is helping brands reach young consumers and the mobile networks make their heavy 3G investments pay off. The potential is huge — the mobile phone is the most direct marketing route available — but brands have so far failed truly to exploit the opportunities. There is currently something of a land grab for mobile content and services funded by advertising, allowing viewers free access in exchange for their eyeballs. Brands are trying to discover what will work for them — a task not made any easier by obstacles thrown up by networks, such as different handsets requiring different video formats. Many advertisers are therefore wondering whether to get involved with sponsored mobile content now or wait until the creases have been ironed out. One pressing argument for early adoption is the numbers. ‘There are approximately 1billion WAP page impressions served in the UK and millions of video downloads per month, so the reach is big enough to interest advertisers,’ says Mark Slade, managing director of 4th Screen Advertising, a specialist in the mobile space. ‘UK operators, in their quest for new revenue streams, are opening their portals to advertising.’ There has been a significant shift by operators in Europe, and in particular the UK, toward advertiser-funded models for their content services that can boost traffic and drive fresh revenue streams. Last month, mobile network 3 announced it would launch an ad-funded video service, offering free video clips to users of its Planet 3 portal, including news, comedy, gossip, animations and film. Not surprisingly, rumours abound that rival UK operators including O2, T-Mobile and Orange are also preparing to include ads on their portals. ‘Our view is that it is a great way for us to monetise content as well as getting fresh content,’ says Peter Northing, director of products and services for 3. ‘The customer gets free content and the advertisers benefit from targeting users. The decline of traditional media will be counteracted by the growth of mobile, and we have proved the concept by the clickthrough rates on ads. People want free content.’ These claims are backed up by 3’s figures. More than 1.2m users viewed Celebrity Big Brother videos over three weeks. On the advertiser side, 70,000 Red Bull ads were viewed through 3’s daily magazine programme and 2.5m Canon clips were watched during the 2006 World Cup. Nevertheless, as an industry, mobile advertising is still in its infancy, and advertisers are understandably wary.

Source - Economictimes

India's Reliance communication has big rural expansion plans

Reliance Communications (Rcom) will set up over 8,900 base terminal stations, which will provide telecom services to over two lakh villages, in the next one year under the Universal Service Obligation (USO) programme. The project comprises of commissioning 8982 base terminal stations, which will provide telecom services in 2,34,000 villages, which do not have any telecom connectivity at present. The announcement of the 'World's Largest and Fastest Rural Infrastructure' project comes a day after signing of MoU for USO programme with the Department of Telecommunication (DoT). The company aims to launch the telecom services within two months, after provisioning of passive infrastructure in these locations. It has also formed a special task force for the National Rural Rollout. The National Rural Marketing Team would be responsible for the completing this task. Last year, RCom had established its telecom network in over 40,000 villages under the USO fund and added close to 7.5 lakh new subscribers in these areas. The company also plans to enhance its network coverage to 25,000 towns and 4.5 lakh villages by March 2008 and has earmarked a capex of 2.5 billion dollars (Rs 11,000 crore) for its expansion plans during this fiscal.

Indian Teleco's ready to woo rural customers

In line with a slew of steps taken by other service providers, Bharti Airtel has lowered the bar on lifetime prepaid to Rs 495. A similar move enabled RCOM to set what it claimed was a global record by selling over a million handsets in under a week. A day after RCOM’s move, the world’s leading handset maker Nokia chose India for its global launch of seven entry-level handsets. At the same time, the newly-merged Nokia-Siemens Networks lauched its ‘village soultion’ which lowers the capex for service providers by 50% in order to tap rural markets. This concept will see village entrepreneurs sign up as franchisees, while Nokia-Siemens will provide them with the requisite equipment to provide GSM services within a 4-5 km (2.5-3 mile) range to rural residents for as little as $3 a month. Cellular operators will link their own network to the ‘village solution’ networks on a revenue-sharing basis.

The rural plans of Indian private operators
Recently, Bharti Airtel has said the company would invest up to $3.5 billion in fiscal ‘07-08, the bulk of which would be spent on rural India. Similarily, RCOM plans to invest $2.5 billion this year to connect every town and village with a population of over 5,000. Vodafone plans to launch ultra low-cost handsets in India soon.

What's the big deal in life time plans ?
A six-month long study carried out by Trai, after the introduction of lifetime pre-paid services last year, has shown that at least 72% of subscribers opting for this scheme recharge their phones every month, instead of merely receiving incoming calls as commonly perceived. The average monthly revenue per user (ARPU) for lifetime pre-paid users across the country is Rs 218 compared with Rs 261 for normal prepaid users. Pre-paid (lifetime and normal) subscribers constitute over 80% of India’s cellular base of over 165 million. It does not stop there — the Trai study also notes that these are high users of value added services. “This implies that from revenue proportion, lifetime schemes are no different from the general tariff plans offered by mobile operators in the market,” observed Trai after studying the data.
For cellular operators, telephony usage by subscribers under this scheme is more lucrative as the tariff charges here are higher than those for normal prepaid customers. This implies, if a customer on a lifetime scheme uses his mobile for a minute, his operator gets Re.0.80, when compared to Re. 0.77 for a normal subscriber. Trai on the success of lifetime validity schemes over six months revealed that 16% of the country’s mobile base had opted for such schemes. Off these, only 51% were new users, while the rest had migrated from their exisiting schemes. Besides, 28% of the total additions during this period was on account of lifetime validity schemes. “The revenue composition of lifetime tariff schemes shows that a large proportion of revenue is contributed by outgoing calls and other services. This implies that from the revenue proportion, lifetime schemes are no different from the general tariff plans offered by mobile operators,” Trai said. The big picture emerging from the analysis based on empirical data is that the scheme has been very popular. Along with halving the entry price, operators have also come introduced Rs 25 top-up vouchers. The Rs 25 vouchers bring down call charges in the lifetime schemes to normal ratesAn analysis by telecom regulator

Bharti's strategy
Bharti Airtel, has lowered the bar on lifetime prepaid to Rs 495 in a move that could change the dynamics of the telecom sector. So far, lifetime pre-paid services have been available for Rs 999 (or at equal monthly instalments of Rs 99 for 12 months) and halving of the charges is expected to expand the market by making mobile services more affordable. In practice, ‘lifetime’ validity allows users to receive incoming calls for the duration of a company’s licence, which is for 15 years. It gives subscribers the flexibility to choose any plan for outgoing calls. Recent history shows that other operators are likely to follow suit soon with attractive lifetime offers. Bharti’s move is in line with a slew of steps by handset manufacturers, service providers and network majors over the last two weeks to lower the entry barrier and tap into the country’s massive low income market.

The catch with Bharti’s new offer launched on Thursday is that subscriber will have to use ‘‘a minimum of Rs 200 every 180 days to continue enjoying lifetime validity benefits.’‘ The existing Airtel Easy Lifetime prepaid subscribers (Rs 999 offer) can also avail this scheme by recharging with Rs 495. The tariff rate will be Rs 1.99 for a local call and Rs 2.99 for other calls in India. Tariff rates for local calls under the non-lifetime schemes is as low as up to 40 paise for local call.

Tata Teleservices, which pioneered lifetime pre-paid services in October 2005, saw rapid increase in subscriber base at a time when it was struggling for stability in the fast-growing sector. Soon, other operators including Bharti and Reliance Communications (RCOM) also launched such services.

Customers prefer GPS service from mobile over TV ?

According to the results of a survey by U.K. research house Canalys, consumers are far more interested in knowing exactly where they are, courtesy of Global Positioning System (GPS) capability built into their cellphones, than they are in watching television shows on a little screen, Canalys says 62 percent of those it surveyed in its "Consumer Mobility Survey" said "it would be useful to have satellite navigation built into their mobile phone," while barely half (51 percent) showed any interest at all in mobile TV. And of those interested in mobile TV, the market was so fractioned that no one version of the service came out as particularly attractive.
Surprisingly, even the prospect of free mobile TV, paid for by advertising, didn't excite consumers. "Just under half the people in the survey said they had no interest in watching any kind of TV on a mobile phone, even if the service was free," Canalys says. "Consumers are more open to advertising-supported services around location and communication than TV."
These survey results were based on responses from more than 2,000 employed, adult wireless users in France, Germany, Italy, Spain and the U.K.

For advertising-supported services, the survey showed higher interest around vehicle and pedestrian navigation, mobile e-mail and IM than for TV. Operators need to think carefully before prioritizing unproven content services over applications that consumers already accept are useful and have value.

Live TV events, related to sports matches or reality shows, were narrowly the most popular content type for mobile TV that 29 percent said they would watch; 23 percent said they would watch content relating to hobbies or personal interests that they could not get at home. A similar proportion was interested in having access to exactly the same channels as they had at home, while 15 percent said they would be interested in watching videos from such Web sites such as YouTube (and 40 percent of those who said they watch YouTube on the "big" PC screen indicated they would be interested in watching it on wireless handsets as well). A final 14 percent liked the idea of place-shifting content they had already recorded at home.
However, Canalys says, there's a "big question" about what users are willing to pay: "YouTube users may well have greater interest but are, of course, accustomed to getting video content for free."

Canalys also asked folks what mobile phone they are likely to consider. A whopping 84 percent put Nokia on top.

Chinese operator buys Pakistan's Paktel

China Mobile Ltd., the country's biggest mobile-phone operator by subscribers, has said that its parent, state-owned China Mobile Communications Corp., bought 100% of Pakistan telecommunications operator Paktel Ltd. for US$460 million and renamed it CMPak Ltd.

The parent company plans to invest US$400 million in Pakistan this year to expand the (CMPak) networks. China Mobile Ltd. might acquire the Pakistan operation from its parent in the future.

Motorola installs wind & solar driven GSM cell site for rural areas

Motorola says that it has deployed a wind and solar power system to operate MTC Namibia's GSM cell site at Dordabis village in the Khomas region of Namibia. The trial with MTC Namibia supports the African operator's strategy for increased voice and data service coverage in rural areas of Namibia and is the first of its kind globally.

By incorporating renewable energy solutions into communication networks Motorola is trialling this solution as a feasible option for operators instead of utilising costly fuel generators or waiting long periods for a mains grid connection. Though this particular trial is being delivered on a GSM network, the Motorola solution has the capability to be applied to other wireless networks that have rural cell site power issues. Once installed, the cost of power is almost zero, and wind and solar powered cell sites require minimal maintenance unlike a diesel driven generator which generally requires, at a minimum, a monthly visit for refueling.

Virgin mobile planning to enter Indian Telecom Market

Virgin Mobile is reported to be planning a joint venture with India's second largest CDMA network operator, Tata Teleservices. The report in the local Economic Times newspaper said that Virgin will exclusively license the Virgin Mobile brand and technology expertise in the area of value-added services (VAS) and handsets to Tata.

The two parties are understood to have started recruitment for the joint venture, expected to be functional this quarter. The UK-based global executive search firm CHR Global is recruiting staff for the new entity, sources told the ET newspaper. The search for a CEO for the joint venture is on.
While Virgin typically operates as an MVNO, these are not currently permitted in India. It is thought that the joint venture will operate on the Tata network as a branding alliance.
Spokepersons from both company declined to comment, the paper said.
Tata Teleservices ended the first quarter of this year with a little under 11.5 million subscribers . The company market share in the Indian market is around 7.24%.

By 2010 there will be 46 million mobile video subscribers ?

As per market research firm Infonetics Research's latest report, Service provider revenue from mobile video services jumped 317% to almost $200 million worldwide from 2005 to 2006, and is expected to triple in 2007. Similarly, the number of worldwide mobile video subscribers increased more than 300% between 2005 and 2006, and is set to soar to over 46 million by 2010, the report shows. Drivers for this strong growth include increasingly powerful and efficient handsets and the expected analog broadcast signal switch-offs.

The healthy growth in the mobile video services market will come as mobile operators expand the bandwidth of their existing 3G networks through HSDPA and MBMS, roll out dedicated broadcast networks, and deploy new mobile video service delivery platforms (SDPs). Competition among service providers will keep subscription prices lower in the long term, but that revenue will be supplemented by incremental service revenue from on-demand viewing. the report expects to see a spike in mobile video service revenue in 2008 due to the Summer Olympics in Beijing which, similar to last year's World Cup, is a deadline for many operators to get their mobile video services up and running.

Report Highlights
1) Asia Pacific will be the regional stronghold of mobile video subscribers through at least 2010, with 57% of the world total in 2006, followed by EMEA at 31%, North America at 10%, and CALA at 3%
2) SK Telecom in Korea and NTT DoCoMo in Japan offer their mobile video services essentially free, a major reason Asia Pacific's share of mobile video service revenue is about half that of EMEA, despite having almost twice as many subscribers
3) The number of mobile video handsets sold worldwide nearly doubled from 2005 to 2006 (including video-capable handsets not necessarily tied to a specific mobile video service)
Mobile video service ARPU (average revenue per user) in all regions increases significantly from 2006 to 2010, tripling in Asia Pacific (from a low base) and more than doubling in CALA

Source -

IPTV deployment - Lessons can be learnt from China

Three of the world's largest IPTV deployments are currently going on in China. The largest is in Hong Kong, where PCCW deployed its own technology (since licensed to Huawei) and now has more than 800,000 customers. On the mainland, Shanghai Media Group (SMG) has deployed IPTV over China Telecom's infrastructure in Shanghai and hit 150,000 subscribers since launching in September 2006. In the north, in Harbin, China Netcom and SMG have partnered to deploy IPTV since the summer of 2005 and are nearing system capacity with 112,000 customers.

Ying Wu, a Bell Labs veteran who co-founded UTStarcom, the company providing most of the IPTV infrastructure to the two China telcos, is predicting as many as 1 million mainland Chinese IPTV subscribers by year's end. One reason for that optimism is that UTSI and ZTE, which provides half of the set-top boxes SMG is using in Shanghai, have been able to deliver IPTV technology that uses low-cost set-top boxes and is viable at a very low average revenue per user (ARPU).

These deployments are unlike anything that is happening in the U.S., in large part because the Chinese market is totally unlike the U.S. market. For one thing, Shanghai Media Group, a government-owned entity, was granted the first of what are now four IPTV licenses in China and has partnered with the two major incumbent government-owned telcos, China Netcom and China Telecom, because the telcos themselves are forbidden from owning content or content licenses.

The services SMG has delivered use UTStarcom's Rolling Stream broadband TV and video-on-demand infrastructure, which is designed for rapid scalability and uses MediaStation streaming and storage servers to keep content and network intelligence within the network, not distributed to individual set-top boxes.

UTStarcom built its IPTV technology on the next-generation architecture it began to design seven years ago for its Personal Access System and includes both the Mswitch softswitch already serving 55 million subscribers in China and the IP-DSLAM it has sold in China, India and Japan.

Both China Netcom and China Telecom are delivering the service over 3 Mb/s copper lines and currently are limited to standard-definition TV. The government maintains tight controls over content, which is limited. There are services such as 48-hour playback of any show, network-based personal video recording (PVR) capabilities and interactive features. This approach enables the Chinese to use very low-cost set-top boxes and to offer services for as little as $5 per month.

BSNL & Reliance Industries Ltd (RIL) set to enter into telecom solution deal

Mukesh Ambani’s Reliance Industries Ltd (RIL) is set to sign a five-year communications solutions deal with Bharat Sanchar Nigam Ltd (BSNL) estimated to be worth Rs 500 crore - reported Economic times. As per the deal, BSNL will link all undertakings of the group during this period, connecting 2,500 petrol pumps, about 15,000 retail outlets, 14 manufacturing units, all its upcoming SEZs and also provide global connectivity to RIL, sources close to the development told ET. The deal envisages that BSNL provide mobile, basic, broadband services, leased lines, virtual private network (VPN), multi-protocol label switching (MPLS) and enterprise solutions to RIL. BSNL will also provide the bandwidth for RIL’s captive network, which interconnects all its outlets and offices. Reports also indicated that the contract would involve providing about 60,000 mobile connections to RIL employees, which could be scaled up later.
The contract with RIL, when signed, would be similar to its agreement with ICICI. BSNL interconnects and provides telecom solutions to all ICICI outlets (including ATMs) in the country, and industry sources estimate the value of this contract to be Rs 100 crore per year. State-owned MTNL, which offers telecom services in Delhi and Mumbai, also stands to gain from BSNL’s contract with RIL. This is because, MTNL will provide all communication solutions to RIL in the two metros, where BSNL is not present.

Earlier, this year, RIL had joined hands with the Bharti group to source mobile and enterprise communication services, which includes mobile, broadband and leased line services, for its retail venture. However, the catch here is that Bharti also plans to use these solutions for captive use for its own retail venture with Wal-Mart. At the same time, Reliance is also planning a pan-India WiMax network for back-end communication needs of its SEZs, which may be extended to meet needs of its retail venture in the long run. Reliance plans to invest about $750 million (Rs 3,400 crore) to obtain spectrum and lay out the network.

Tata Teleservices opposes DoT's plan to auction 3G spectrum to foriegn players

As per Economic times - "Tata Teleservices has opposed communication and IT minister Dayanidhi Maran’s plans of allowing foreign players to bid for 3G spectrum and said that this would lead to further scarcity of radio resources and hamper the growth of existing operators. The company which offers CDMA-based telecom services, has also alleged that the Department of Telecom (DoT) was ‘completely disregarding the recommendations of telecom regulator Trai for facilitating the progress of existing GSM and CDMA operators from 2G to 3G services’. 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 said. The company has pointed out that at present, there was shortage of 2G spectrum, and therefore the spectrum-efficient 3G network would primarily be used to provide voice services in the beginning. “The logical policy, therefore, has to be allow the entry of 2G companies into 3G to further develop their markets and to grow by getting more spectrum and by using their existing infrastructure, instead there is a move to cap the growth of the existing players completely disregarding the recommendations made by Trai...,” the company said."
Additionally, Tata Teleservices has also objected the proposals of the internal committee formed by DoT to study the 3G spectrum pricing and allocation recommendations of Trai. This committee has suggested that four telecom companies be given 3G spectrum in the 2.1 Mhz frequency, through a bidding process, while adding that if state-owned BSNL and MTNL did not figure among the top four in the auction, then the PSUs must be given 3G spectrum provided they match the price of the second highest bidder. Tata Teleservices has pointed out that Trai had recommended that only existing players be allowed to bid for spectrum in 2.1 Ghz, and that too for a quantum of 5 Mhz each. “Inviting external entities with blocks of 10 Mhz of spectrum, will not only drive the costs up, but will also limit the number of operators. Then existing licensees will be forced to conduct their operations in sub-optimal fashion with sporadic and minute allocations of as little as 1.25 Mhz at a time. The reasons for such unfair treatment must be divulged and such unfairness is clearly not going to be accepted by the industry,” the company added. On the proposal for a quota for BSNL and MTNL, Tata Teleservices said that such treatment, in addition to being against the recommendations of Trai, would also not offer a level-playing field between private and state-owned players. It has also added that BSNL and MTNL were no longer the sole custodians of public interest as the government itself had allowed civil servants and PSUs to embrace the services of private telecom service providers.

Blackberry maker RIM (Research in Motion) to setup R&D support base in India

As per media reports, Blackberry-maker Research In Motion (RIM) will soon set up its R&D and customer support base in India. The company could in fact look at turning India into a hub for its customer support services eventually. The Ontario, Canada-based company is yet to finalise the size of investment.

The company is also working with a number of Indian software development companies popularly referred to as independent software vendors (ISVs) for developing enterprise applications that run on its mainstay Blackberry Enterprise Server (BES). It is BES that runs all the enterprise-centric apps based on RIM’s highly successful `Push services’ platform, including corporate e-mails, for its corporate customers.

Indian regulator targets non-performing ISPs

Concerned over poor track record of Internet Service Providers, Indian telecom regulator TRAI has recommended lowering of foreign direct investment on par with telecom sector at 74 per cent from the existing 100 per cent. ISPs having 100 per cent FDI equity should be given two years for reducing foreign holding to 74 per cent, it said.

In its recommendations to Department of Telecom, TRAI has also suggested major changes in financial and regulatory levies. Instead of free entry, it recommended levying an entry fee of up to Rs 20 lakh along with a uniform licence fee of six per cent of gross revenue. ISPs seeking licence at national level will have to pay Rs 20 lakh as entry fee while it will be Rs 10 lakh for state level ISPs. The minimum annual licence fee has been pegged at Rs 5,000 for district level ISP, Rs 10,000 for state level and Rs 50,000 for national level ISP.

The regulator has taken a tough stand as the objective of competition and growth of Internet have not been met. "Out of 700 licences issued within three years of opening of ISP sector to private service providers, only 389 licensees exist on Thursday. As per the performance monitoring report with TRAI, only 135 Internet service licensees are functionally active," TRAI said.

Future of content on mobile - Mobile TV will dominate !

The research house, Screen Digest has released a report which studies the impact three very different offerings of mobile content will have on key mobile markets by 2011.

1) Mobile gaming
The gaming market is currently worth €1.6bn, with 50% of that revenue based in South Korea and Japan, but market growth is slowing. By 2011 it will be worth €2bn ? increasing only incrementally in the next five years. Screen Digest mobile analyst David MacQueen believes that as operators shift focus onto music and TV services, the mobile games market will stall unless current business models change.

2) Mobile music
Screen Digest forecasts that the global over-the-air full track music download market will grow explosively over the next five years, reaching €1.47bn by 2011 ? an eight fold increase from 2006. One of the major contributing factors to this growth is going to be the availability of subscription services which offer more than just audio tracks. However, the majority of music on mobile phones will still be 'side loaded' from the PC. (Also see our story on digital music )

3) Mobile TV
As per the report, Mobile TV will put gaming and music in the shade.
It is the newest of all mobile content offerings ? TV ? that looks set to emerge as the strongest performer globally, delivering €4.7bn of revenue from 140 million subscribers by 2011. The new broadcast services, launched in only a handful of markets, are growing rapidly. For instance, Unicast services, delivered over existing 3G networks, have begun to generate real revenues in Europe.
While cynics doubt that consumers will be happy watching TV on such a small device, consumers are proving them wrong. Just under 6m people watch broadcast mobile TV in Japan and South Korea and the new broadcast networks in Italy have already attracted just under half a million subscribers only a few months after launch. Mobile TV's revenue potential is greater than that of games or even music due to the mass market nature of the product. Screen Digest believes customers will subscribe to 'simulcast' channels ? that is, simultaneous broadcasts of conventional TV programming.
Regulatory and competitive pressures have pushed down the average consumer spend on voice and messaging. Mobile operators must now look to new content offerings to deliver the business growth they've enjoyed over the past decade. Screen Digest believes that the revenue is out there ? and operators should be looking to TV, music and games to deliver it.

Digital music sale will overtake physical sale by 2011 - Are Telcos ready for the opportunity?

According to a report from Gothenburg, Sweden-based analyst firm Berg Insight, digital music sales will overtake physical sales in Western Europe by 2011. In 2007, the group estimates that digital sales will account for 10 percent of total music retail revenues.

I see a big business oportunity for Telcos (esp. broadband operators - both in wireline & wireless segment) in this segment.

TRAI comes out with mechanisms to ensure implementation of 3 stage redressal mechanism for Indian telcos

The Telecom Regulatory Authority of India, which last week had directed all landline, mobile and internet service providers to set up to set up a three-stage redressal mechanism and improve transparency in billing with immediate effect, will carry out surprise checks, if necessary, to ensure compliance.

Trai has directed all operators to maintain complete and accurate records of redressal of grievances by its call centres, nodal officers and appellate authorities. Trai, if necessary, will direct any of its officers or employees or through an independent agency appointed by it to inspect the records maintained by the call centres, offices of the nodal officers and the secretariat of the appellate authority.

Trai had asked all operators to three-stage redressal mechanism -
1) Call centres will be the first level of customer redressal and must address all customer grievances within a maximum period of seven days.
2) At the next level, service providers must appoint a nodal officer, whom the customer can contact if he is not satisfied with the redressal at the call centre level.
3) The third level involves a provision by which the customer can appeal to the appellate authority (within the service provider) for redressal where the authority should issue its judgement on the issue within three months.

The regulator had also directed all operators to improve the quality of their billing after its survey revealed that nearly 80% subscribers found it difficult to understand their telephone bills. Accordingly, Trai has mandated that information such as applicable tariff plan, credit limit, security deposit, methodology for calculations of various pulse rates and charges, procedures regarding payments of bills, setting up of public grievance mechanism and display of customer information box with certain information be printed in easily readable font size and be included in the telephone bills issued to consumers.

Source - Economic times

India's Reliance Communications has de-activated 5.6 million subscribers in March 2007.

Mandatory subscriber verification norms and resulting deactivation of connections have rejigged market share of telecom operators, hitting Reliance Communications (RCOM) the most. An analysis of the latest data on mobile subscriber base in the country shows that the verification process has also led to a change in India’s GSM:CDMA ratio, making it more skewed in favour of the GSM platform. RCom, India’s second largest private operator, saw the market share going down to 18% from 20.5% as it de-activated 5.6 million subscribers in March.

The deadline for subscriber verification was March 31, 2007, and the recognition of an unverified customer after this deadline would attract a fine of Rs 1,000. Those users who could not be verified were disconnected by telcos. As a result, RCOM reported a subscriber base of over 28 million as of March 2007, 10.6% lower than the previous month’s number. Its CDMA business was the worst affected, depicting a fall of 13% in subscriber base at 24.6 million. RCOM’s GSM user base rose 5.8% to 4.1 million in March.

RCOM was the only mobile services provider among the top five who suffered a drop in the market share. With this, the share of CDMA connections in total mobile subscribers as of March fell to 26.7% from 29.2% a month ago. This implies that less than 27% of users are now on CDMA compared to almost 30% earlier. The total mobile subscriber base in the country rose 2% to 161m in March. The outcome of this was that BSNL has grapped the number two position in the Indian wireless space.

Wi-Fi market will reach US $ 5.6 billion in revenues by 2012 ?

If market research report released by Telecom Trends International is to be believed then Wi-Fi is poised for widespread adoption in both consumer and enterprise market segments over the next six years. The report says the overall Wi-Fi market will reach US$5.6 billion in revenue in 2012.

Report anticipates - The industry adoption of 802.11n Draft Specification 2.0 will be a major factor in the growth of Wi-Fi. The specification will allow equipment vendors to transition to the final 802.11n standard next year through software upgrades. Offering end-user data rates of well over 100 Mb/s, 802.11n more than quadruples the speeds of Wi-Fi networks. With increasing Wi-Fi adoption in the enterprise market, revenue in the enterprise space will surpass that in the consumer market over the next six years. 802.11n will herald a networked home where multimedia networking will be the norm.

The implementation of Unlicensed Mobile Access represents the first step in fixed mobile convergence and the adoption of IP Multimedia Subsystem will give impetus to this convergence. According to the report, end-user devices are increasingly both voice and data enabled, and are becoming dual-mode, supporting both Wi-Fi and cellular networks. During the forecast period of this report, voice and data roaming between cellular and Wi-Fi networks will become seamless.

India's Reliance communications planning to expand 30 million lines of CDMA ?

As per Local newspaper, DNA - India's Reliance Communications is reported to be considering a US$1.5 billion expansion of its CDMA network to add capacity for some 30 million additional lines. Reliance has not commented on the issue.

The company is also understood to have delayed a huge US$6 billion order for GSM network infrastructure pending clarification of spectrum allocation issues. The company has applied for licenses to cover the whole country but is waiting for policy to be announced later this year. The Department of Defence is due to release a large chunk of radio spectrum in July which could be used for GSM services.

Source -

600 million mobile users in India by 2011 !!!

According to a new study published by the Centre for Telecoms Research (CTR) London, Mobile phone connections in India will reach 600 million in five years time. The growth will arise from pre-paid connections riding on cedreasing tariffs and handset prices. The report expects urban populations of India to reach high levels of mobile phone saturation in five years time, to the extent where many phone users will have two or more handset connections.

Mobile connections in rural geographies will be constrained by coverage of network infrastructure and affordability of handsets which will limit consumption to no more than 150 million by 2011 - the report says. The report also expects mobile phone users to spend more on mobile data services driven largely by the popularity of Bollywood mobile content (e.g. Ringtones, Icons etc)

Nokia planning to enhance its handset production capacity in India ?

Nokia is reported to be ramping up production capacity at its Indian factory after the company was able to ship 25 million handsets in one year from the facility. About 80% of the handsets produced at the Chennai factory are for the domestic market, with the rest exported to neighbouring countries - excluding Pakistan where local dealers have difficulty selling Indian produced phones.

DoCoMo-Hutch Essar deal to launch i-mode service in India called off

DoCoMo and Hutchison Essar, called off a deal to launch mobile Internet services in India using DoCoMo's technology due to U.K.-based operator Vodafone Group's bid for a controlling stake in Hutchison Essar, a major Indian operator.

NTT DoCoMo is Japan's dominant cellular provider but has seen profits fall as it competes with rivals in the saturated domestic market. While the financial hit from Monday's canceled deal will be small, it is symbolic of how the company has generally struggled to establish new sources of income.

DoCoMo's i-mode service includes technology that lets users send email and view online content via mobile phones. In December, the company and Hutchison Essar had agreed to launch the service in India this year. The company may now considering various other options in India, including tie-ups with other Indian carriers.
India is one of the world's fastest growing telecommunications markets, with about 206 million subscribers currently. Japan has more than 100 million users, but growth is largely stagnant.

India requires 3,30,000 towers by 2010 to achieve 500-million telecom subscriber base

Telecom Regulatory Authority of India (TRAI) estimates that the country requires aproximately 330,000 towers by 2010 against the present number of approximately 100,000 towers to achieve 500-million telecom subscriber base by 2010. To tap the unlimited opportunities Essar Telecom Tower and Infrastructure, GTL Infrastructure and Srei Group's Quipo, all biggies in the telecom tower business, will collectively invest around Rs 5,000 crore to roll out close to 18,000 towers during the current fiscal.

India added 66.51 million subscribers during the last fiscal compared to 41.91 million in FY'06, registering a growth of 58 per cent-- the highest in a fiscal. Essar plans to add another 5,000 towers from the existing level of 800 by the end of the current fiscal at an investment of Rs 1,200 crore. GTL Infrastructure has already executed 1,200 cell-sites in eight circles and is in the process of rolling out 6,700 sites by March 2008 with an investment of Rs 2,030 crore. Quipo is also set to increase its towerbase to 6,000 sites from 800 now with an approximate investment of Rs 2,000 crore by end of the current fiscal. The company has plans to invest USD 2.5 billion by 2010 to set up 30,000 cell-sites. It would invest another half a billion in FY 2011.

Nokia launches new models based on shared handset concept for emerging market

Nokia Corp, the world’s largest handset maker, has launched seven mobile phones priced between Rs 2,000 - Rs 5,000 (excluding taxes) for emerging markets. The global launch was done from India! This intensified the competition in the entry-level mobile segment in India. The launch includes two models which are intended for shared use by families or entire villages. Incidentally, Nokia’s launch comes just a day after Indian CDMA major Reliance Communications announced the launch of its cheapest ever handset at Rs 777 (See our story - Handsets at Rs 777 ). In contrast, the Nokia 2505, the only CDMA handset which featured in Thursday’s launch is priced at about Rs 4,750. Reliance’s counterpart in the CDMA space, Tata Tele offers handsets priced at Rs 1,200 and upwards.

The entry level segment in India is set to see further competition with the entry of UK-based telecom operator Vodafone who is all out to tackle the rural market with ultra-low cost handsets and bundled services. Vodafone has a tie-up with Chinese manufacturer ZTE for entry-level handsets. GSM operator Spice, which also manufactures handsets will soon launch Rs 1000 phones, while US-based handset major Motorola offers entry-level products priced Rs 1,200 upwards.

Nokia is estimated to have close to 60% market share in the mobile segment in India, and is also the dominant player in the entry-level segment, where it leads rivals Motorola, Samsung, Chinese and Taiwanese manufacturers. Nokia’s shared models — 1200 and 1208, which cost over Rs 2,000 are equipped with call-tracking and multiple phone books — features which allow many people to use a common handset on a shared basis. Other built-in features in these latest handsets, specifically incorporated for emerging markets include pre-set time and cost barriers, which allows calls to be terminated once it reaches a certain limit. Nokia’s launch assumes importance as the shared mobile handset concept in villages is viewed as the right strategy to improve penetration in rural India. This phenomenon is already popular in some parts of the country. The latest launch was meant for emerging markets such as India, China, Africa and Latin America.

Idea Cellular to rationalize its corporate structure by merging eight subsidiaries

In a move to rationalise the corporate structure and improve the consolidated balance sheet of Idea Cellular, Idea Cellular will merge its eight subsidiaries with the company during the current quarter. The A V Birla Group company has filed applications for amalgamation of subsidiaries with respective High Courts within whose jurisdiction the registered office of these entities are located. Since Idea has grown through the inorganic route as well, it acquired companies in some circles while expanding operations. In 2001, Idea acquired RPG Cellular, which was offering services in Madhya Pradesh. Subsequently in 2004, it bought Escotel, which was the incumbent operator in Haryana, Uttar Pradesh (West) and Kerala. It was later renamed Idea Mobile Communications. The licenses for Uttar Pradesh (East), Rajasthan and Himachal Pradesh were issued to Idea Telecommunications, which began operations in these circles last year.

Idea’s other subsidiaries are BTA Cellcom, Sapte Investments, Vsapte Investments, Bhagalaxmi Investments and Asian Telephone Services. The last four are investment companies and special purpose vehicles, each holding 25% stake in BTA Cellcom. The revenues from all of these are consolidated with Idea’s revenues, which was over Rs 4,400 crore for the fiscal 07. The consolidated net profit was Rs 503.2 crore. On a standalone basis, Idea’s revenues for full year were Rs 2826 crore while the net profit was Rs 277.7 crore.

Earlier this year, the AV Birla group flagship Aditya Birla Nuvo (ABN) sold its wholly-owned subsidiary Aditya Birla Telecom (ABT) to Idea Cellular for Rs 10 crore. The A V Birla group had floated ABT in 2005 as a back-up mechanism when it did not fully own Idea Cellular. Through ABT, the group filed applications with the Department of Telecom (DoT) for licenses in Mumbai and Bihar circles. Since Idea was earlier jointly owned by the Tatas and Birlas, the group needed a separate vehicle to apply for telecom licenses in newer circles. Now, the company is in the process of rolling out network in Bihar. Idea is expected to commence operations in Mumbai and Bihar by the end of this year. It is also likely to start NLD services during the current fiscal.

Hutch Essar deal - Vodafone clears major hurdle

With Indian finance minister P Chidambaram giving his go-ahead, Vodafone seems to have cleared its last hurdle in acquiring a controlling stake in Hutch Essar. This approval comes within a week of the Foreign Investment Promotion Board giving its nod for the acquisition and should pave the way for Vodafone to secure management control of HEL and for the company to be renamed Vodafone Essar.

As per a leading finanacial daily " As a first step, Vodafone will now be able to constitute a new 12-member board to oversee the operations of the company. Essar vice-chairman Ravi Ruia will be the chairman of Vodafone Essar and Vodafone chairman Arun Sarin will be the vice-chairman. Max India chairman Analjit Singh and HEL MD Asim Ghosh will also be on the board."

The drama
The Vodafone-HEL regulatory saga, which saw the proposal being deferred thrice by FIPB, began in February soon after Vodafone announced it had agreed to acquire companies that controlled 67% in HEL from Hutchison Telecom for $11.1 billion. This had given rise to a controversy about whether the 15% held by Mr Singh, Mr Ghosh and IDFC should be counted as FDI. Besides, RBI and some government officials were reported to have initially opined that the 15% shareholding amounted to violation of FDI and Fema norms. However, the initial adverse views of some government departments were overruled by FIPB last week. This was after the law ministry, in its response to queries raised by the finance ministry, said Mr Singh and Mr Ghosh’s holdings did not amount to ‘benami’ transactions and were wholly Indian. Vodafone had also taken pains to clarify that it had directly acquired 52% in HEL along with options on stakes held by local partners which would give it what it described as ‘economic interests’ over the remaining 15%.

Curtain is yet to be closed...
What remains to be contended is a public interest litigation (PIL) filed by an NGO called Telecom Watchdog, which is pending in the Delhi High Court.

Nokia Siemens introduces 'Village Connection' - a solution for affordable rural connectivity in new growth markets

Nokia Siemens Networks has introduced its new solution, Village Connection, for affordable rural connectivity and coverage in new growth markets. NSN Village Connection offers an easy concept to build rural connectivity village by village, enabling an innovative franchise-based business model between an operator and local village entrepreneurs.
The solution supports GSM based voice and SMS services, including roaming and connection to the outside world. A range of value-added services can be added, such as cost-effective Internet services in villages via the Internet protocol link.

The Village Connection comprises GSM access points located in villages and regional access centers. A village would typically host one access point module comprising GSM radio, power and IT hardware and software components.
The access point only requires simple installation and powering can be done, for instance, by solar energy. Each access point connects to standard GSM mobile devices and autonomously handles calls within a village through local switching.
Access points are connected via Internet Protocol links to a regional access center. The access center connects the villages to the main GSM core network and handles the calls between the villages.
The Village Connection allows transferring responsibility for network and business functions to a local level, building cost-effective connectivity village by village. It can employ local people to manage access within each village, or local entrepreneurs may license the mobile access rights for their surrounding area. The solution will be available in 2008.

TRAI's new directive to Indian telcos on setting up three-tier consumer grievance redressal system

The Telecom Regulatory Authority of India (Trai) has issued rules mandating all telecommunications companies - landline voice, cellular and broadband - set up a three- tier system to address consumer grievances.
The regulator pointedly specified that the rules apply to the two large government-owned phone companies as well as to all others.
Indian communications companies, in theory, are supposed to have been addressing grievances via their call centers. However, earlier this year in a series of hearings leading to the new regulations, Trai learned that Indian consumers have been frustrated and, in some cases, have been unable to even find out who to go to with their complaints.

Under the new rules, carriers have just one month to appoint so-called "nodal officers," two months to set up call centers to receive consumer complaints, and three months to appoint "appellate" authorities who will serve as the final arbiters of complaints. The rules also set strict new requirements regarding the kinds of information consumers must receive on their bills. "Recent survey on Quality of Service sponsored by the Authority revealed that about 80 percent (of) subscribers have difficulty in understanding their telephone bills," Trai explained.
In addition to demanding that operators set up the three-tier system, Trai set strict time limits regarding how quickly phone companies must respond to consumers. Telcos will have just 72 hours to respond to complaints involving fault repair, service disruption and disconnection of service. For other complaints, answers must be provided within a week. If consumers still are not happy, they can go to the "nodal officers," who get a similar three days to deal with such complaints as service disruption. The final consumer appeal is to the so-called "appellate authority," which gets three months to answer.

Reports indicate consumer groups already are objecting to the Trai plan because it is the phone companies that will set up and run the complaint system. Trai, for its part, noted in its order that the Indian law setting up the regulator does not give it the authority to deal with individual consumers' problems. It also called its new rules "soft-touch regulation focusing primarily on self-regulation by service providers for the redressal of grievances of telecom consumers."
Trai also pointed out that while its new rules don't prevent consumers from taking any complaints they have to the appropriate courts, it hopes the new complaint system "would reduce the litigations in the courts constituted under the law to adjudicate complaints of consumers."

Nokia Siemens plans to slash 9000 jobs

Nokia Siemens Networks is slashing 9,000 jobs, with the biggest cuts coming in Germany and Finland. The cutback represents the upper end of staff reductions of between 10 percent and 15 percent out of a total of 60,000 workers that Nokia and Siemens had envisioned when they first unveiled their joint-venture plans last year. The goal of these cuts is to save the venture as much as $2 billion per year by the end of 2010.
Nokia Siemens will attempt to transfer at least some workers, rather than simply lay them off, into businesses affiliated with the joint venture, which finally got off the ground last month. It did not estimate how many of the 9,000 would end up in the "transfer" category.

Nokia Siemens already has launched negotiations with employee representatives in Germany and Finland, with similar talks in other countries to start in the coming months. In Finland, where the company has 10,000 employees, Nokia Siemens plans an initial staff reduction of 700 employees. By the end of 2010, the company said, it expects an "adjustment" in Finland in the range of between 1,500 and 1,700 employees, including the initial 700. In Germany, the company expects staff cuts of between 2,800 and 2,900 employees between now and the end of 2010, from an initial base of approximately 13,000. The company did not detail the size of planned cuts in any other countries; it has at least some presence in every corner of the globe, with operations in 150 countries.
Nokia Siemens Networks combines what was Nokia's Networks Business Group and Siemens' carrier-related operations for fixed and mobile networks. A large part of the rationale for combining the companies' two operations was cost synergies - the largest of which is the reduction in headcount.

DoT India has accepted TRAI's recommendation on reslae of international bandwidth & access to landing stations

The Department of Telecom, India has accepted TRAI's proposals of resale of bandwidth and access to essential facilities like landing for submarine cables at landing stations with a view to promoting competition in this segment which will bring down prices. TRAI has proposed an entry fee of Rs 1 crore and a bank guarantee of the same amount for operators to be allowed for buying bulk bandwidth from international long-distance telecom companies and selling it to end users such as banks, IT firms and BPOs. The regulator also suggested a license fee at six per cent of adjusted gross revenues, same as that of ILDOs. The Licensor has also amended the relevant clauses in ILDO licence to ensure efficient, transparent and non-discriminatory Access to Essential Facilities including landing facilities for Submarine Cables at Cable Landing Stations (CLS).

Only ILDOs such as Bharti Airtel, Reliance, BSNL and VSNL, are permitted to sell international bandwidth, also known as international private leased circuits. TRAI believes that competition in IPLC (international bandwidth) segment could be enhanced if ILD licensees entering the market have adequate access to necessary facilities at cable landing stations. The CLS are the points at which International submarine cables come onshore and terminate. To ensure this access, the interconnection regulations should provide for dominant suppliers who control or who are responsible for the operation of the cable landing station, to allow other licensees to have access to the cable landing stations and physically co-locate their own equipment. The regulation should also see that interconnection at the cable landing station to any operator's equipment in the station at any technically feasible point; and access backhaul circuits of all types in a timely fashion, under terms & conditions and rates that are cost-oriented, transparent, and non-discriminatory.
TRAI had earlier observed that the IPLC segment was lacking competition. Examining the issue of access to cable landing stations (CLS) by various service providers TRAI felt that competition in IPLC is being hampered by the absence of mandated equal access to cable landing stations. Therefore, it recommended that ILD licence agreement should be removed and the clause expanded to mandate permission to landing of submarine cables owned by licenced operators.

BSNL should share interconnection port charges - Argues COAI

the Cellular Operators Association of India has submitted before tribunal TDSAT, which is hearing a matter on call congestion that "Network congestion is due to lack of Points of Interconnection (point where different networks meet) provided by BSNL... We have no option and the fault is with BSNL,"
Private cellular operators, nursing a grudge against regulator TRAI for making them pay for interconnection with BSNL, gave vent to their feelings by blaming the authority for poor quality of mobile services.
COAI further blamed TRAI for formulating wrong policies on the interconnection front, saying the regulator had put the onus on private operators to get interconnection with BSNL and also bear the entire cost of the exercise.
They demanded that BSNL also share the cost of interconnection.
The operators sought to highlight contradictory stands taken by TRAI, saying the regulator at one time attributed the poor quality to BSNL's failure to provide interconnection and on the other blamed private operators for lack of efforts to get timely access to BSNL network.
The COAI, in a rejoinder filed through advocate Naveen Chawla to BSNL's reply on the matter, stated that at time of framing of rules, the telecom PSU was only a fixed line operator.
BSNL, which subsequently launched Cellone, started routing all the outgoing and incoming calls traffic through the ports installed by them. Hence, the state-run company must share cost of interconnection, COAI argued.

Airtel eying at international bandwith - joins two international undersea cable consortiums

Foreseeing a rapid increase in its requirements for international bandwidth, and in a move, which is in line with its plans to be a major player in the enterprise segment, Bharti Airtel, leading private telecom operator in India, is set to join two international undersea cable consortiums for submarine links to Europe and the United States.

Bharti has joined the Telekom Malaysia (TM) led 17-member consortium of telecommunication companies to set up an Asia-America gateway (AAG) — the first submarine-cable system linking South-East Asia directly to the US. At the same time, Bharti is said to be in talks with other Asian, African, and European telecom majors for building the fifth (South East Asia-Middle East-West Europe; Sea-Me-We-5) undersea submarine cable connecting South East Asia to Europe via the Indian subcontinent and the Middle East.

AAG is a 20,000 km-long cable system, which is expected to be operational by the fourth quarter of 2008, and when completed it will connect 10 locations in eight countries across the Asia Pacific region, namely Singapore, Malaysia, Thailand, Brunei Darussalam, Vietnam, Hong Kong SAR, the Philippines, Guam, Hawaii and the US West Coast. Bharti will join other consortium partners such as TM, AT&T Inc Coporation (USA), Bharti AirTel (India), the government of Brunei Darussalam, British Telecom Global Network Services (UK), CAT Telekom (Thailand), Eastern Telecommunication Philipine Inc to set up the gateway for this cable. Bharti already has a submarine cable link from India to Singapore through its wholly-owned i2i cable. On the other hand, this will be the Sea-Me-We consortium’s fifth major cable linking Asian countries to Europe. While Bharti along with Tatas-owned VSNL are already part of the Sea-Me-We-4 consortium, which became operational early last year, VSNL is also part of the Sea-Me-We-3 consortium. However, the plans to build the Sea-Me-We-5 are still on the drawing board, with the consortium members, the participating operators and the countries, which this cable will touch, not determined so far. According to, David Nishball, President, Enterprise Services, Airtel, partnership in AAG cable system reinforces the company’s commitment to invest in the state-of-the-art technologies for providing scalable and future proof solutions for our international customers.

Malaysian Tycoon Ananda Krishnan plans to buy Maxis communication - Aircell India to gain from plans

Malaysian tycoon Ananda Krishnan plans to buy out the country’s largest mobile operator, Maxis Communications in a deal that could be worth at least $5 billion. Maxis gave no reason for the buyout plan but industry analysts speculated that Krishnan, the country’s second-richest man after Robert Kuok, might want to relist Maxis offshore and raise foreign capital to fund international expansion. Maxis, which faces a price war and a maturing market at home, is expanding into larger and less-developed Asian markets like Indonesia and India to drive growth.
Maxis can be listed overseas, feels telecom analysts , the buyout plan could be a first step toward raising money to fund major investments in India and Indonesia. Krishnan-controlled firm Usaha Tegas, a major shareholder in Maxis, has notified the company that it and its affiliates will make an offer by Thursday, Maxis said. Krishnan, a self-made billionaire of Sri Lankan origin, held an indirect interest of 47.05% in Maxis as of April last year, according to company data. At the current share price, a buyout bid for the remainder of about 53% would cost around 17.4 billion ringgit ($5.1 billion).

Malaysia’s mobile phone market is fast reaching saturation, forcing Maxis and smaller rival, state-controlled Telekom Malaysia, to expand overseas for growth. In Malaysia, more than three-quarters of the 26 million population own a mobile phone. Maxis stock, which was suspended from trade before the company statement, has climbed nearly 50% in the past 12 months, outperforming the wider market by about 7%. The stock fetches 16.2 times projected earnings, compared with India’s top mobile phone services firm, Bharti Airtel, on 38 times and China Mobile on 18.2 times.

Ananda Krishnan’s plans to buy out Maxis Communications will boost the company’s plans for India, say analysts. Mr Krishnan owns just under 48% of Maxis, which has a controlling stake (74%) in Aircel, India’s fifth largest GSM player with over 5 million subscribers. More so, considering that Maxis had recently said that it would need an additional $3 billion to expand operations in India in the future. Maxis two overseas ventures — India’s Aircel and Indonesia’s PT Natrindo Telepon Selular . The company’s profits have surged 46% over the last 12 months riding on strong subscriber gains both at home and in India. In fact, Aircel accounted for 13% of Maxis’s fourth-quarter revenues. The company plans to invest over Rs 2,000 crore in its Indian operations in 2007-08, as it has set a target of reaching 8 million subscribers during this period. In the last fiscal, Maxis had invested about Rs 2,700 crore in Aircel, of which Rs 1,350 crore was paid to the Department of Telecom (DoT) towards entry fee for licenses in 14 new circles in the country, while the remaining was spent on network expansion. Aircel holds licence to offer telecom services in 9 telecom circles in the country and aims to be a pan-Indian player and expand its presence to all 23 circles by the first half of 2009. As the first step, the company recently launched services in both Himachal Pradesh and Bihar. Aircel was recently been granted both the national and international long distance licences by DoT.

The reclusive 68-year-old Krishnan, a former oil trader, also controls Malaysian pay-TV operator Astro All-Asia Networks and gambling and leisure firm Tanjong. The Harvard Business School graduate, with a net worth of $6 billion according to Forbes magazine, was a close friend to former premier Mahathir Mohamad.

International Roamers can avail VSNL's wireless broadband services in India

Prateek Pashine, vice president (marketing and technology) has reported to media that Tata Group company VSNL is all set to provide roaming wireless broadband services to international travellers during their stay in India. The service will allow seamless roaming and usage within the VSNL wireless broadband network in India wherein visitors can access high-speed wireless broadband using their home country account and identity. As part of the rollout, VSNL has partnered with StarHub, Singapore's second largest info-communication company. This will allow all StarHub customers - whether mobile, broadband or cable - to use wireless broadband service at over 200 Tata Indicom Wi-Fi Hotspots across India. Other global Wi-Fi operators will soon be added to the list of roaming partners. VSNL, a global communications services provider, is the only Indian member in the Wireless Broadband Alliance (WBA) - a global consortium of the world's leading wireless operators.

MTNL's trend of falling fixed line connection reversed ?

After more than three years, state-run firm MTNL has checked the trend of falling fixed line connections as customers are again subscribing to landline phones to avail value-added services like broadband.
"The trend of surrendering the phones, which started in 2004, has been reversed. Two main initiatives - broadband and IPTV have helped us retaining customers," Kuldip Singh, MTNL Director (Technical), told a media agency.
The company has more than 37 lakh fixed line subscribers in Delhi and Mumbai. So far, about five lakh subscribers have left MTNL's fixed line services as they switched to mobile phones. While some of them took MTNL's mobile connection, others opted for private mobile services.
MTNL would soon announce convergent billing for all services like fixed line phone, mobile, broadband and IPTV.
As reported by Economic times - In Delhi, there has been a net addition of fixed line connections for couple of months while in Mumbai it was in the negative zone marginally, Singh said.

BSNL ready to issue orders for its 45.5 million lines GSM tender

As reported by Economic times - "State run BSNL is likely to place a Rs 20,000 crore mobile telephony order with the two winners of the contract - Ericsson and Nokia by second week of May to increase the capacity of its network.

When issued, this would be the world's largest ever single tender for 45.5 million lines of GSM telephones. - By December, the first phase of BSNL's GSM expansion is expected to be in place. The first phase is for 17.5 million lines while the second and the third phases are for 14 million lines each.
With this, the pressure on BSNL's mobile service will ease off and quality of service will improve.
In March, the PSU topped the charts in subscriber addition with 1.98 million GSM subscribers, increasing its total user base to 2.74 crore.
The order got delayed by six months since as one of the disqualified bidders - Motorola went to court challenging the tendering process. The process could start only after Motorola withdrew the case.
Telecom Minister Dayanidhi Maran has announced a 500 million telephone target by 2010 and also on an average 3 million GSM additions per month from 2008-2010.
Any further delay in the project could not only result in BSNL losing its third position in terms of mobile subscribers, but also derail the Minister's vision.
As per the terms of the tender, Ericsson, which had emerged as the lowest bidder, will get 60 per cent of the 45.5 million lines while the second lowest bidder Nokia would get the remaining 40 per cent.
BSNL has already stated that, if necessary, it could scale-up the tender size by 50 per cent and possibly even 100 per cent after the initial orders have been placed.
The vendors will be allowed to import only for the first phase. From the second phase onward, the specified core components of the network will have to be manufactured in India. Also, the minimum value addition of indigenization of such core components must be 30 per cent. "

Handsets at Rs 777 in India!!!

India's leading telecom service provider Reliance Communications has launched mobile handsets for as low as Rs 777 (less than $19), for the first time in India. The price of the handsets, named as Classic 202, Classic 204 and Classic 203, starts from Rs 777 and goes up to Rs 888 with facility of payment in installments.

The Anil Ambani-controlled company has said it would invest Rs.100 billion this year as capital expenditure towards expansion.

Mobile companies in India showed impressive 4th quarter results

The results for the fourth quarter of the 2006-07 fiscal - The three big telecom companies in India Bharti Airtel, Reliance Communications (RCOM) and Idea Cellularthat have reported impressive growth. The market was expecting a double digit growth, though there was concern over a falling average revenue per user (ARPU), following the expansion of companies into smaller cities with lower usage. Also, the mandatory requirement to verify and authenticate the identity of subscribers was expected to impact the reported subscriber base.

However, Idea reported a 48% rise in topline for the full year and a more than two-fold jump in bottomline. The operating margins for the eight established circles remained stable, compared with the previous year.

The Delhi-based Bharti Airtel has also posted growth in sales and profits on Friday. Its topline grew 59%, while bottomline surged 89%. Further, the company reported improved operating efficiencies, compared with the previous year, as operating margins expanded by over 300 basis points (bps).

The Anil Ambani group company RCOM’s operating margin shot up from 24% in the prior year to 40%. The pace of growth reported by the companies can be attributed to the scorching pace at which they are expanding the subscriber base. This has been combined with their ability to keep costs under control. Mobile companies in India are adding about seven million users every month — the fastest anywhere in the world — on the back of lower tariffs. Moreover, the minutes of usage (MOU) per subscriber are also on a rise given the gradual transition of users from fixed telephones to mobile. This has particularly taken care of the falling ARPU. For instance, in the case of Bharti, the ARPU fell 8% from the previous year, while the MOU increased 10%. The telecommunication companies are also keen on expanding into other forms of services, including direct to home (DTH), long distance telephony and broadband offerings. All the three companies have announced capex plans to fund their expansions. The valuations of Bharti, in terms of enterprise value per subscriber, is gradually softening. For instance, post FY07 results, Bharti’s valuation stands at Rs 35,538 per user, compared with Rs 41,500 per subscriber in March. In the case of Idea, it has increased from Rs 20,800 per subscriber to Rs 24,200 per subscriber.

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