CDOT: 25 years of connecting India

From http://www.hindustantimes.com/News/interviewsbusiness/25-years-of-connecting-India/Article1-446342.aspx on August 25, 2009

Established in 1984 the Centre for Development of Telematics (C-DOT) has been responsible for developing state-of-the-art telecommunication technology to meet India’s need for telecommunication network. C-DOT’s Executive Director P.V.Acharya spoke to Hindustan Times. Excerpts:

After 25 years later, how would you describe the journey so far?

From the starting point of developing digital switching systems, C-DOT has traversed the complex Telecom landscape, developing products in the area of optical, satellites and wireless communication from circuit switching technology of yesteryears, C-DOT has proven its expertise in ATM and Next Generation Networks.

C-DOT was set up to meet India’s unique requirements. Has this objective been achieved?

C-DOT started as a mission oriented centre with a mandate not only to develop digital switches, but also to create a mass manufacturing and vendor’s base. Within a very short time, telecom switching products ideally suited to Indian conditions started revolutionising rural telecommunication in the form of small rural automatic exchanges for towns. This was followed by induction of higher capacity digital switches known as main automatic exchanges (MAXs).  C-DOT technology spread across the country through its licensed manufacturers with very strong technology transfer methodology.

C-DOT made a commitment to develop products in 36 months for Rs.36 crores. Twenty five years later, what is the road ahead?

C-DOT has realigned its efforts and defined its roadmap with a focus in four major directions keeping in view the relevance and need in the present scenario. The major developmental schemes in these directions, for the 11th Plan period (2007-2012) include the shared GSM Radio Access Network, which is currently under development, will give a fillip to business in rural India.

Revenue, not user base, to set telecom pecking order

17 Jun 2009, 0305 hrs IST, Rashmi Pratap, ET Bureau

MUMBAI: Subscriber numbers in India’s wireless story are losing their relevance today as far as determining the industry position of a service provider is concerned. t will be revenues and not subscriber numbers that could decide the pecking order in the world’s fastest-growing telecom market.

This is reflected in the latest revenue figures released by the industry regulator, Trai. Going by this, the top three operators in India are Bharti Airtel, Vodafone Essar and Bharat Sanchar Nigam (BSNL).

Airtel’s adjusted gross revenue (AGR) from wireless and wireline operations was Rs 7,998 crore for the March quarter. Vodafone Essar, which offers only mobile services, had revenues of Rs 4,456 crore during January-March 2009 on a subscriber base of 68.7 million. Reliance Communications (RCOM), which has the second largest customer base, reported an AGR of only Rs 2,998 crore on 72.6 million users during the quarter, making it the fourth largest in terms of revenues.

The revenues for the state-owned BSNL stood at Rs 3,943 crore making it the third largest. BSNL offers mobile services on GSM apart from fixed line services. Besides showing the revenue capabilities of an operator, AGR is significant, as it is the basis on which service providers pay licence fee and spectrum charges. Operators pay a revenue share licence fee to the government ranging from 6% to 10% of their AGR. Increasingly, operators are targeting revenue growth instead of a larger user base.

According to Bharti Airtel’s vision statement, the company’s aim is 20% increase in revenue margin per subscriber in the next few years.

Analysts contend that with more and more low-end users signing up for services, it is becoming difficult for operators to maintain margins and improve ARPUs (average revenue per user per month). In such a scenario, those who continue to grow revenues along with subscriber base will be the clear winners.

“As the new subscriber base is primarily drawn from tier III towns and rural markets, the incremental subscriber addition is not leading to a commensurate revenue upside for telcos. The catchphrase to evaluate a telco’s performance will be quality of subscribers rather than the number of new subscribers,” Acsendia Consulting principal analyst, Alok Shende told ET.

A smaller player like Idea Cellular, which operates in 13 circles, had AGR of Rs 2,389 crore on a subscriber base of 39 million. This is just about Rs 600 crore less than RCOM on a base which is almost half of that company.

KPMG director (telecom) Romal Shetty said, “Initially, everyone was going after subscriber numbers. Now, they are looking at quality of subscribers. This explains the emphasis on value added services (VAS), which bring in higher revenues.” He pointed out that low-end pre-paid users are now bringing in monthly revenues of as low as Rs 70 per month.

Tata Teleservices reported revenues of Rs 1,889 crore during the quarter placing it at sixth followed by state-owned Mahanagar Telephone Nigam (MTNL). Aircel, a relatively new entrant, is at the eight position, which had AGR of Rs 721 crore during the quarter.

IDEA to roll out GSM service in Chennai soon

From http://www.economictimes.com on June 17, 2009

CHENNAI: Telecom operator IDEA Cellular, part of the Aditya Birla Group, would soon roll out its GSM service in the metro, a company official said here on Tuesday.

“It (GSM service) should be rolled out in Chennai very soon,” IDEA Cellular Chief Corporate Affairs Office Rajat Mukarji told reporters.

The company has already launched its service in Coimbatore, Madurai and other cities apart from the metro, he said.

To a query, he said they have received a ‘good’ response from the cities in Tamil Nadu where the services has been launched. However he declined to specify the number of mobile phone connections they had provided.

The company has operations in four southern states. In Karnataka it acquired telecom operator Spice while it has rolled out services in Kerala and Andhra Pradesh, he said.

He said the Southern region ranked ‘fourth’ in the company’s overall subscriber base. “Out of the 40 million customers (in the country), 25 per cent is from Southern region”, he said.

LG to launch record 50 handsets in India – CIOL News Reports

By Joyeeta Dey via LG to launch record 50 handsets in India – CIOL News Reports on http://www.ciol.com on June 17, 2009

SINGAPORE: Eyeing to double its market share to 11 per cent in the fast growing GSM mobile telephony, world’s third largest mobile phone maker LG Electronics today said it will launch 50 handsets by the end of 2009 in the Indian market.

“The number of product line-up has doubled as compared to 2008. We plan to launch 50 handsets by the end of December and aim to keep our market share over 11 per cent there (India),” Bo H Choi, Head (Asia Pacific Region), Mobile Communication Company of LG Electronics told PTI.

At present, the South Korean firm has a 5.25 per cent in GSM segment while the company enjoys nearly 50 per cent market share in the CDMA space. Choi was speaking after LG’s launch of three new smart phones — Crystal, GM 730 and Viewty Smart — at telecommunications conference CommunicAsia 2009, here.

He pointed out the company would be eyeing India as one of the important investment destinations since the demand from developed economies are witnessing a saturation.

In terms of global sales, LG is the third-largest behind Nokia and Samsung. The South Korean entity is ahead of Motorola and Sony Ericsson.

Related stories at

• http://efytimes.com/efytimes/fullnewsxml.asp?edid=35201

BSNL’s GSM project faces further delay

Thomas K Thomas on The Hindu Business Line on June 15, 2009

New Delhi, June 15 Finnish telecom equipment-maker Nokia Siemens Networks (NSN) has shot off a fresh letter to Bharat Sanchar Nigam Ltd’s two-member integrity panel alleging that it has been unfairly singled out of the bidding process for the Rs 30,000- crore GSM project.

NSN has alleged some of the other bidders had also not produced certificates required to be eligible for the tender.

The panel is investigating whether the tendering process was transparent or not. BSNL will not award the contracts till the investigations are complete.

Experience certificate

The Punjab and Haryana High Court had directed BSNL to give the reasons in writing. According to BSNL sources, NSN had not submitted an experience certificate for the North zone. However, NSN countered it on the ground that the certificate submitted for other zones was relevant for the North zone as well. NSN said in its letter that if BSNL had to disqualify its bid, then the PSU should have also rejected Ericsson’s bid since the latter had allegedly not given a separate certificate for 2G equipment, though BSNL had floated different tenders for 2G and 3G equipment.

BSNL had referred the dispute to an integrity panel approved by the Central Vigilance Commissioner after NSN took its case to the CVC seeking intervention. Two former Chief Election Commissioners — Mr T.S. Krishnamurthy and Mr B.B. Tandon — are the members on this panel. Ericsson and Huawei were short-listed by BSNL, which had rejected offers from NSN, Alcatel Lucent and ZTE.

Spice Mobile plans entry into Africa

Thomas K Thomas on The Hindu Business Line on June 13, 2009

New Delhi, June 12 After Indian mobile operators venturing into international markets, it is now the turn of cell phone makers.

The B. K. Modi Group-owned Spice Mobile is planning to sell mobile handsets in developing markets in Africa and Asia in a bid to replicate its growth story in India.

Speaking to Business Line, Mr Kunal Ahooja, Director and CEO, Spice Mobile, said, “We have launched our products in some foreign countries such as Nepal. We are planning to launch in more countries including in Africa. These markets are similar to India with low margins and high volumes.”

According to a market survey, Spice Mobile is now the third biggest brand in India in terms of the number of handsets sold overtaking global majors such as Sony Ericsson and LG.

While Nokia and Samsung occupy the first two slots respectively, Spice Mobile is the first Indian brand to take the third spot.

LG is, however, higher ranked than Spice when it comes to the value of sales.

Target segment

According to Mr Ahooja, Spice Mobile is set to become the No 2 brand in terms of units sold by next year, overtaking Samsung.

The company is targeting the mid-range segment with two-three new models every quarter.

Asked if the company plans to shift its manufacturing base from China to India, Mr Ahooja said the Government should create a policy that is conducive for local manufacturing. “If importing works out cheaper than manufacturing here, then why should anyone set up a unit in India,” said Mr Ahooja.

Spice Mobile sells both GSM- and CDMA-based mobile handsets. The company has already introduced a handset for third generation (3G) technology and could bring in more models once operators start offering the service.

Will TN be Tata DoCoMo’s first port of call?

The Hindu Business Line on June 13, 2009

Our Bureau

 Chennai, June 12 Although Mr Deepak Gulati, President, Tata DoCoMo, refused to commit on when the new GSM mobile operator would begin its calling, he let slip a telling comment as he closed a meeting with a group of journalists here: “See you before the end of this month.”

There was nothing notably unique in Mr Gulati’s description of relative strengths of Tata Docomo vis-À-vis the competition: Strong parents, winning technology, value-based pricing, unexceptionable customer service — singularly common industry language. When this was pointed out, Mr Gulati said, “Wait and see.”

Tata Docomo has GSM licence for offering cellular phone service in 18 of the 22 telecom circles in India. Of the other four, the only significantly large circle that the Tata-NTT DoCoMo joint venture does not have is Delhi. (DoCoMo has a 26 per cent stake in the company, which it acquired in November 2008 for $2.7 billion.)

Mr Gulati said that DoCoMo is the largest operator in Japan with 52 per cent market share, a pioneer of the 3G technology in Japan, and an intensely technology-based company. Backed with such technical strengths and Tata’s brand image, Tata DoCoMo expects to garner a significant share of the growing Indian mobile market. Mr Gulati did not want to disclose the company’s subscriber or revenue projections.

Chennai unit top producer for nokia

12 Jun 2009, 0210 hrs IST, Kalyan Parbat, ET Bureau

KOLKATA: Chennai has edged past China as a unit-wise volume producer of Nokia cellphones. In fact, Nokia’s Chennai factory is now the company’s largest cellphone manufacturing facility in the world.

China has two such Nokia factories and Chennai one. But Chennai Nokia has now edged past the larger of the two Chinese factories. While the Finnish cellphone maker is not revealing the annual capacity of its Chennai factory, a senior member of its global planning team said the factory is now indeed its largest manufacturing factory. Unofficial reports suggest Chennai manufactures over 100 million phones every year.

Interestingly, over 70% of Nokia’s 8,000-strong employee pool at the Chennai plant are women, involved in a mix of running productions lines, maintenance and assembly and testing operations.

Nokia operates state-of-the-art mobile phone manufacturing units in India, Finland, China, Korea, Mexico, Brazil, Romania and Hungary. “The Chennai factory is the largest in Nokia’s global ecosystem, although the dynamics in terms of product line vary in each market. But the international markets that we serve out of Chennai have seen the largest growth in volume terms.

At present, Nokia ships GSM phones from the Chennai factory to over 50 markets spanning South East Asia Pacific (including Australia), India, the Middle East and Africa,” said a senior official who did not wish to be named.

When contacted, a Nokia India spokesman said: “As a company policy, we do not share specific capacity numbers of our factories worldwide. All I can confirm at this stage is that our Chennai operation has seen the fastest ever ramp-up across our nine cellphone manufacturing plants. The ramp-up is in terms of the unprecedented growth in cellphone production volumes within a three-year span.”

The latest development is seen as a milestone of sorts for the Finnish cellphone maker and is in sync with its plans to take big strides to grow the Indian handset turf. It also comes at a time when the world’s top cellphone makers, under the ambit of the Indian Cellular Association, are targeting a national production volume of 250 million mobile handsets by calender 2012.

Several presentations have been recently made to the Department of Telecommunications by the manufacturing advisory committee. The larger objective of players like Nokia, Samsung, Motorola and Spice is the creation of an additional 1 lakh jobs during 2009-14 in cellphone manufacturing, assembly, R&D and design.

While Nokia churns out a dazzling mix of GSM phones in India, the first camera phone to be manufactured at the Chennai works was the Nokia 2630 while the first music phone was the Nokia 5130. It does not manufacture CDMA phones in India as yet.

NTT DoCoMo, Tata To Launch GSM Service This Month

From www.efytimes.com

Thursday, June 11, 2009:  NTT DoCoMo, in association with Tata Teleservices Limited (TTSL), has announced the new ‘TATA DoCoMo’ brand for a GSM service to be provided in India, in which DoCoMo owns a 26 per cent stake. TTSL plans to launch the GSM service in southern India this month and gradually expand it nationwide.

The new brand, developed by the business and technology cooperation committee that DoCoMo and TTSL have jointly established, symbolises the two companies’ partnership and their commitment to the development of India’s rapidly growing mobile phone market, according to the company.

DoCoMo, as part of its effort to leverage TTSL’s continued growth and development, is participating in TTSL’s management by providing human resources and technical assistance to help realise improved network quality and the possible introduction of leading-edge value-added services.

Related stories at

• http://economictimes.indiatimes.com/Tata-Tele-to-roll-out-GSM-services-by-month-end–/articleshow/4642325.cms
• http://economictimes.indiatimes.com/Tata-Tele-announces-launch-of-GSM-services/articleshow/4639383.cms
• http://www.ciol.com/technology/mobility/news-reports/tata-tele-enters-gsm-service/10609120795/0/
• http://www.financialexpress.com/news/tata-tele-announces-launch-of-gsm-services/474261/
• http://www.thehindubusinessline.com/2009/06/11/stories/2009061150940400.htm
• http://www.ciol.com/technology/mobility/news-reports/after-cdma-tata-tele-to-foray-into-gsm/4609120570/0/

(Refers to Lucent, Motorola and ECI)

GSM base growth slips again in May (adds 8.3 mil)

The Hindu Business Line Bureau on June 11, 2009

 New Delhi, June 11 GSM based mobile subscription growth rate has slipped for the second consecutive month.

GSM operators added 8.3 million users in May, taking the total user base to 306.45 million, according to the Cellular Operators’ Association of India. The operators had added 8.97 million in April and 10.8 million in March. The slump in growth has been attributed mainly to lower additions by state-owned Bharat Sanchar Nigam Ltd.

BSNL saw its subscribers additions slow to 4.5 lakh in May, less than half of April’s 1.04 million and less than one-fifth of record additions of 2.50 million in March. In comparison, Bharti Airtel added 2.8 million new subscribers in May while Vodafone got just over 2.5 million in the same month. “Private operators are maintaining the growth rate. If BSNL ramps up its network then the growth rate will be back on track,” said an industry representative. Both Idea Cellular and Aircel have added more than one million new subscribers each in May.

Related stories at

• http://economictimes.indiatimes.com/India-adds-over-8-mn-GSM-mobile-users-in-May/articleshow/4646220.cms
• http://www.ciol.com/technology/mobility/news-reports/india-adds-8.3mn-gsm-users-in-may/12609120881/0/
• http://www.ciol.com/technology/mobility/news-reports/8-mn-new-gsm-users-in-india/12609120917/0/

Excerpt from above:

Meanwhile, the Reliance Communications (RCom) has deactivated over 36,000 connections in Jammu & Kashmir even as the state police continued its probe into the violation of guidelines in issuing SIM (Subscriber Identification Module) cards.

 

“The company has deactivated 36,000 connections and begun an internal probe into issuance of mobile connections on the basis of fake documents,” senior superintendent of police, crime branch-Jammu, J P Singh said. Singh, who is heading the probe, said Reliance had conveyed to the crime branch the deactivation of these numbers and on the progress of its internal probe.

 

RCom, Alcatel to enter into Rs 3,000cr deal

From www.ciol.com on June 9, 2009

MUMBAI, INDIA: In what could be one of the largest outsourcing deals in the Indian telecom space, Reliance Communications is close to awarding a $500-600 million (Rs 2,500-3,000 crore) operations and maintenance contract to French telecom infrastructure provider Alactel-Lucent, says a report in Business Standard. The contract would be either executed independently by Alcatel-Lucent or by the joint venture between Alcatel-Lucent and RCom formed in May 2008 for managed network services that would take on outsourcing contracts from global telecom operators.

On the GSM front, RCom will initially outsource the operations of five circles — Himachal Pradesh, Haryana, Punjab, Jammu & Kashmir and Chhattisgarh — to Alcatel-Lucent.

The outsourcing deal also includes managing and strengthening RCom’s 175,000 km global optical fibre cable systems. The OFC system, of which 80,000 km is in India, is also used to carry international telecom data.

Related stories at

• http://economictimes.indiatimes.com/Reliance-Comm-may-give-contract-to-Alcatel-Report/articleshow/4634278.cms

RComm, Kribhco JV eyes rural cell market

From Hindustan Times on June 9, 2009

Kribhco and Reliance Communications Ltd (RComm) on Tuesday formed a joint venture — KRIBHCO Reliance Kisan Limited (KRKL) — to distribute RComm’s services through its network of more than 25,000 cooperatives throughout the country.

KRIBHCO will hold 60 per cent equity in the joint venture company with the balance 40 per cent held by Reliance ADAG group.

“The JV will market telecom products of RComm — both GSM and CDMA,” said SP Shukla, president, wireless, Reliance Communications.

“Later, KRKL will also distribute products and services of other business enterprises of Reliance ADAG including Reliance Capital, Reliance Entertainment and BIG TV DTH,” he said.

This is the second such marketing tie up to reach out to the rural area. Earlier, Bharti airtel did a similar tie up with IFFCO.

Related stories at

• http://www.business-standard.com/india/news/rcom-kribhco-to-form-jv/360632/
• http://www.thehindubusinessline.com/2009/06/11/stories/2009061150960400.htm
• http://economictimes.indiatimes.com/RCOM-ties-up-with-Krishak-Bharati-to-capture-rural-India/articleshow/4640234.cms

CDMA group sees 100 m new subscribers in India

Thomas K Thomas on The Hindu Business Line on June 9, 2009

New Delhi, June 8 Notwithstanding the fact that there are more number of operators moving towards offering GSM-based mobile services, the CDMA Development Group (CDG) has projected that India will have 100 million new CDMA subscribers over the next two years if operators are given adequate spectrum.

Speaking to Business Line, Mr Perry LaForge, Chairman of the CDG, said, “We think the CDMA subscriber base will grow another 100 million in two years. Both Tata Tele Services and Reliance Communications have reiterated their strong commitment to CDMA. They have been clear that the decision to implement GSM was really a matter of necessity because they do not have visibility as to when and what spectrum they will receive for CDMA. This situation needs to be corrected so that these operators can continue to grow wireless communications in this market. CDMA will flourish here in India if spectrum is provided.”

There are 100 million CDMA subscribers currently with Reliance Communications and Tata Tele both of whom are rolling out GSM services as well. Among the new players only Sistema Shyam has chosen to adopt the CDMA technology.

‘Faster growth than GSM’

Mr Laforge said the growth of CDMA has been much faster than GSM. “CDMA started years after GSM launched (GSM started in 1995). After seven years GSM reached 10 million subscribers. CDMA launched in 2003 and by 2004 reached 10 million subscribers and by 2007, 50 million subscribers — the fastest of all technologies to reach 50 million subscribers. We have now reached the 100 million mark just two years later. This is remarkable growth and CDMA operators have achieved 25 per cent of the market with just two operators competing against entrenched operators.”

However, Mr LaForge said, for this growth to continue, operators will need to have spectrum to pursue competition on a level playing field with GSM counterparts.

Mr LaForge said CDMA operators are better positioned to offer broadband services. “With high-speed wireless Internet access now a reality in CDMA with advanced wireless broadband services such as Reliance’s Broadband Netconnect+ and Photon Plus Services offered by Tatas, we see operators continuing to offer more devices, more services while improving their average revenue per subscriber. In many cases, the top wireless broadband operators in the world, in terms of performance, are CDMA operators. Examples include KDDI and Verizon. We believe this will continue to fuel CDMA growth here in India,” said Mr LaForge.

Tata Teleservices Picks Ceragon Solutions

From www.efytimes.com on June 08, 2009

Monday, June 08, 2009:  Ceragon Networks Ltd, a provider of LTE-Ready wireless backhaul solutions, has received new orders from India teleco Tata Teleservices Ltd. Ceragon’s advanced SDH and IP FibeAir solutions will support Tata Teleservices in expanding its GSM mobile network to seven new communication circles that cover a population of nearly 400 million.

Tata has already deployed Ceragon’s high capacity backhaul equipment in three circles following a long-term supply agreement the companies signed in mid-2008. This agreement is now extended, bringing the number of circles served by Ceragon equipment to a total of 10, including the Delhi metro area.

Ceragon will provide Tata with the FibeAir 1500R wireless SDH solutions and its FibeAir IP-10 that supports native TDM, Native2 (hybrid TDM/Ethernet) and native Ethernet over a single platform.

“Tata Teleservices is rapidly moving and gearing towards launch of GSM services and also enhancing capabilities on CDMA network. To match the scale, we selected Ceragon as our technology partners. We found that Ceragon’s systems offer a variety of benefits including advanced IP capabilities and a nodal solution with integrated cross-connect. These features fit our network expansion strategy perfectly and will also serve to support our network evolution towards 3G,” said A. G. Rao, president and chief technology officer, Tata Teleservices Limited.

“We are very happy to strengthen our relations with a leading wireless operator such as Tata Teleservices,” said Ira Palti, president and chief executive officer, Ceragon. “Our selection for such a large-scale deployment underscores Ceragon’s ability to deliver the right products to the market, powering our customers with the solutions they need – when they need them.”

Related stories at:

• http://www.financialexpress.com/news/tata-tele-selects-ceragon-for-deploying-gsm-network/473144/
• http://www.ciol.com/technology/networking/news-reports/ttsl-ceragon-partner-for-wireless-backhaul-soln/10609120779/0/
• http://economictimes.indiatimes.com/Tata-Teleservices-selects-Ceragon-for-deploying-GSM-network/articleshow/4631566.cms

Mobile players back proposal for spectrum sharing

The Hindu Business Line on June 8, 2009

Our Bureau

New Delhi, June 7 Cellular operators are backing a proposal suggested by the Department of Telecom’s spectrum committee to allow sharing of radio frequency. Spectrum sharing will allow operators to pack in more subscribers and mobile traffic in the given bandwidth.

According to the spectrum panel an operator with 4.4 Mhz of spectrum will be able to support around 12 erlang of traffic per base station (roughly equivalent to 300 users talking simultaneously).

But if two operators, with 4.4 Mhz each, share their spectrum then they will be able to support 77 erlang (equivalent to 1,900 users) on a single base station. By doubling the amount of spectrum the efficiency levels go up by more than six times.

The higher the better

The efficiency levels increase if the quantum of shared spectrum is higher. For example, if two operators with 6 Mhz share their spectrum they will be able to handle over 100 erlangs (close to 2,500 users) on each base station, compared to just 37 erlang if they offer services without sharing.

“Sharing of spectrum can be beneficial when there are pockets in a region where an operator does not have spectrum or has less spectrum. Sharing makes economic sense only when the full spectrum is shared between the operators in a service area. It should therefore be permitted only when two or three GSM or CDMA operators share their entire spectrum holding in a licence area,” the panel said.

GSM operators say that the panel’s recommendations bolster their longstanding view that dividing spectrum into small portions reduces efficiency levels drastically. “Spectrum sharing will enable operators to have enough bandwidth to accommodate the growing subscriber base,” said a GSM player.

Minimum spectrum

The CDMA players, however, want the DoT to ensure that everyone gets 6.2 Mhz of spectrum under the current subscriber linked criteria and then allow sharing of spectrum. “If DoT wants to permit spectrum sharing on radio frequency that has been acquired through an auction process, then we are fine with that. But they should first make sure that new players get at least 6.2 Mhz and then go for auction,” says Mr S.C. Khanna, Secretary, Association of Unified Telecom Services Providers of India.

‘India lost $16 bn due to 3G auction delay’

From www.ciol.com on June 5, 2009

 BANGALORE, INDIA: The GSM Association, a global trade group for mobile industry consisting of about 750 mobile operators, has urged the Department of  Telecom (DoT) to go ahead with the 3G auctions without any further delay and also make the HSPA  (High-speed Packet Access) a reality.

The delay in 3G auction in India had resulted in a $16 billion loss to the economy; the government should now carry out the auctions without any further delay, said Jaikishan Rajaraman, senior director, GSM Association, quoting a McKinsey report.
 
He demanded that the government must allocate the 2.1 GHz spectrum to drive the deployment of mobile broadband across India. The planning phase for the allocation of 2.6 GHz spectrum must also start now if HSPA is to evolve for the benefit of the Indian population.

According to Rajaraman India will need to make further spectrum available through the digital dividend to support the delivery of more widespread coverage in rural areas.

Quoting the recent McKinsey report he said that once the licenses are issued and 20 billion invested over a period of five years, it will deliver $70 billion economic benefit in the same period.
 
Further, a 10 per cent increase in broadband penetration can result in up to 1.5 per cent increase in GDP. Any further delay in allocation of 3G licenses will prove determinant to the economy, Rajaram claimed.

The GSMA senior director said the development of the GSM technology track (GSM/W-CADMA/HSPA) has been dramatic. In a mere ten years there has been a 1000-fold increase in the data bit rates of mobile networks, while maintaining full backwards compatibility with the very first mobile phones released in the market.

3GPP technologies will continue to evolve, with a clear road map of reaching 42 Mbps peak down link speeds with HSPA+ and exceeding 100 Mbps in the near future with LTE.

This technology road map has given GSM mobile operators the confidence to deploy HSPA with more than 217 networks across the  world, he dwelt.

India will get next 400 million mobile users five times faster

From The Hindu Business Line by Thomas K Thomas on 04 June 2009

Thomas K Thomas

New Delhi, June 3 It took 15 years for India to get 400 million mobile users, but under three years it will add the next 400 million.

According to the revised estimates by the Cellular Operators Association of India, the mobile subscriber base is expected to zoom to 893 million by 2012. That is 150 million more subscribers than what was projected earlier. The COAI’s earlier estimates had put the mobile user base at 743 million by 2012.

The reason for the new optimism is derived from the huge uptake of mobile services in rural areas.

Explains Mr T. V. Ramachandran, Director-General, COAI: “We have revised the projections because the rate at which infrastructure is growing is faster than what we had expected. Operators are moving into the hinterland and uncovered areas. Secondly, we are getting almost 50 per cent of our new additions from the rural areas. The third factor is that the level of competition has increased with new players in the sector which again leads to faster deployment of networks.”

According to Mr Atul Bindal, President, Mobility, Bharti Airtel, three out of five new subscribers are now coming from non-urban areas. “Indian growth story is here to stay. I will push back against any view that says to the contrary. There is still a huge untapped market in both rural and urban areas,” says Mr Bindal, who expects Airtel to get its next 100 million users in another two-three years.

India, with 400 million mobile users, is now the second largest market in the world after China which has over 650 million subscribers. According to COAI’s projection, there will be 1.24 billion mobile users in 2015 – which means one phone for every Indian.

GSM broadband users

Our Mumbai Bureau reports: India could have 100 million mobile broadband users on the GSM platform by 2014, if the 3G auctions happen during the current fiscal, according to the GSM Association. Overall broadband penetration in India is 4.7 per cent now.

3G investments would lead to economic benefit worth around $70 billion, Mr Jaikishan Rajaraman, senior director, GSMA, said at a press meet here on Wednesday.

The delay in the auction of 3G spectrum in the past two years has led to a huge loss of around $16 billion, according to a study by global consulting firm LECG Corp.

The losses include direct investments as well as those arising from missed opportunities.

“Cost of capital increases whenever you choose to defer investments,” said Mr Rajaraman.

HC asks BSNL to maintain status quo on GSM tender till June 10

From The Hindu Business Line, Thursday, Jun 04, 2009

New Delhi, June 3 The Andhra Pradesh High Court on Wednesday asked Bharat Sanchar Nigam Ltd to maintain status quo in the tendering process for awarding to Huawei a contract for rolling out GSM network in the South zone till June 10.

The court has asked the Department of Telecom to file a response to a petition filed by Nokia Siemens challenging the tendering process. The Chinese vendor Huawei will be a party to the case.

Nokia Siemens had challenged BSNL’s decision to disqualify its bids on technical grounds. The Finnish company said that it had supplied equipment to BSNL on previous occasions and, therefore, it was unfair to find technical problems with its bid. It alleged that BSNL had designed the tender to favour some vendors. According to Nokia Siemens, the technical deficiencies in its bid have not been explained.

In a letter written earlier to the Department of Telecom, NSN said that it had clarified all questions which BSNL had raised during the valuation of the technical bids

Similar plea

A similar petition was filed by Nokia Siemens in the Punjab and Haryana High Court which asked BSNL to submit its reasons for disqualifying the company. The Finnish company is examining BSNL’s reply given to the Punjab and Haryana High Court before taking the next step.

The Andhra Pradesh High Court’s order will delay BSNL’s plans to roll out 93-million lines across the country.

The project was divided into four zones. While Ericsson has been shortlisted for North and East zones, Huawei was chosen for South. Bids for the West zone were not opened by BSNL after the Intelligence Bureau (IB) raised questions about giving contracts to Chinese vendors in sensitive regions.

Though the IB had raised objections to giving contracts in the South to Chinese vendors, BSNL went ahead with Huawei.

Interview — CDMA is better than GSM: Sistema Shyam

From http://www.ciol.com on 01 June 2009

BANGALORE, INDIA: Indian telecom sphere is all set to witness a tug of war with six new international telecom players set to enter the scenario.

Sistema Shyam Teleservices, a joint venture between Russia’s Sistema and India’s Shyam group, the only CDMA (code division multiple access) player of the lot, recently launched its services in West Bengal.

During an interview given to CIOL, Vsevolod Rozanov, president and CEO, Sistema Shyam TeleServices, said that CDMA is a better technology than GSM because it enables better utilisation of the frequencies available, and thus helps in bringing down the costs. Excerpts:

CIOL: The Indian metros and urban areas have attained saturation in terms of telecom density. So where do you see the demand coming from and for what?

Vsevolod Rozanov: If we have to grow fast, apart from expanding our footprint in new circles and getting new customers (first-time users), we have to wean away customers from the incumbents.

We believe there is a huge market for us to grow. While there are players who have the first mover’s advantage, there is still a vast chunk of existing individual users who will find higher value for money in our tariff and billing plans.

CIOL: What are your investment plans for India? What will be the focus?

VR: We plan to invest $5.5 billion in India over a period of five years. We will utilize most of this projected investment over the next two years for setting up infrastructure that will enable accessibility and better connectivity for mobile phone users.

We have already invested more than $1 billion in setting up our network. We have launched the brand in Rajasthan, Tamil Nadu, Chennai, Kerala and Kolkata. We are planning to launch services in Delhi by Q3 this year, and looking to foray into one circle every month.

We will eventually cover UP, Haryana and Maharashtra circles by the end of this calendar year. Thus, in the next nine months, the MTS brand will be seen in half of the 22 telecom circles across the country, achieving a pan-India footprint by mid-2010.

CIOL: Do you see a possibility of M&A going forward to meet the increased challenge? What is your take on infrastructure sharing among service providers to combat frequent network disruptions owing to issues like natural disasters?

VR: We are not aware of any significant player in the CDMA segment in India who is planning to hive off its telecom business.

We will have a combination of self-owned and shared infrastructure to ensure that we provide the best connectivity across the country. We already have tie-ups and agreements with various infrastructure companies across the country to ensure superior quality of service.

CIOL: How different will be your ‘go-to-market’ strategy?

VR: In Rajasthan, the key message of our campaign is to create a churn in the market through the slogan, “Badlo life ka plan” (change your life’s plan).

Today over 50 per cent of our subscribers in Rajasthan are not new customers, but those who have switched over from other mobile service operators. They are doing so because they are frustrated with the quality of the old incumbent networks, and are willing to try our non-congested network.

We do not see much difference between GSM (global system for mobile communications) and CDMA. Customers using CDMA technology are approximately one quarter of all. Given the size of the Indian market, this is not small at all.

We have been looking at whether we should wait until we are fully ready with CDMA data offerings or we should start building our customer base and deliver our data offers a bit later. We decided to go in for the second option. We will be coming out with the data offering soon.

CIOL: With several service providers in the frame, will the cost of service be brought down further?

VR: India is a highly price sensitive market. Our pan-Indian strategy will focus on simplicity in all our marketing strategy. We will offer simple, very clear and understandable tariff plans for our customers. Our tariffs will be the lowest, with no hidden charges.

We have dropped the price of entry-level colour phones to Rs 999, and they come with six months of free calls and lifetime validity. The subsidy that we incur on every phone is going down as the price of phones is going down faster than the fall in new offers.

We will offer SMS at 50 paise unlike most other operators who charge one rupee. The tariffs can fall further, if the regulator makes the termination charge cost-based, which would be less than 10 paise a minute from the current 30 paise, the same can be passed on to customers.

CIOL: How do you see advanced mobile technologies – such as 3G, CDMA – gaining currency in rural areas as well, especially when India has very less wireless penetration?

VR: The advanced mobile technologies such as 3G have the potential to meet the digital divide between rural and urban India by penetrating into far-fetched areas, where fixed-line connectivity is sparse due to high deployment cost of infrastructure. 3G will not only alleviate the existing level of voice-based services, but also make Internet broadband access a reality for larger population.

3G will also fit well into the urban user’s plan. It will enable quality voice and address the pent-up demand for high-bandwidth data exchange on mobile phones and support high-speed Internet access on other portable devices.

The government has recognized 3G as the cornerstone for growth of the telecom sector and is expected to allocate the third generation on priority.

CIOL: What is being done to take the brand into the market?

VR: MTS is the eighth-largest telecom company in the world with over 100 million customers. In India, we are the sixth or seventh operator. We are using faces of models talking on the mobile phone to relate to the consumers and give our service the human touch. We have also decided to concentrate most of our advertising and marketing spend on local media, via regional language instead of English.

We have also recently rebranded our existing operations in Rajasthan, under the ‘Rainbow’ brand, to MTS. Rainbow was a regional brand limited to Rajasthan and what we needed was a pan-India brand name. Accordingly we painted the Pink City Jaipur to red – the colour of our brand.

The most important factor is the time-to-market – how quickly we could launch the brand across India in the next nine months. With MTS, the brand material, logo and specifications are all readymade and already available

CIOL: How do you look at the slowdown?

VR: Global economic slowdown is a business challenge for enterprises across the globe. However, Sistema is one of the largest public diversified corporations in Russia. We have sufficient funds to expand our operations, and launch our services on a pan-India basis.

India is one of the fastest growing markets for telecom, and has been relatively un-impacted by recession. As of now, the situation is under control, because the financial meltdown has not impacted Indian banks in a major way.

However, if the situation worsens, then we could be in a spot as we are not allowed to bring in foreign funds in the form of debt. We are allowed to bring money in the form of equity, but our promoters would like to have the flexibility to decide on what form they would like to pump in money into the company.

The Indian Government should consider relaxing the foreign investment norms, which will allow international players to bring in funds in the form of loan.

CIOL: What would be the newer trends in the Indian mobility sector?

VR: The year 2009 is expected to be an exciting year for the Indian mobile telephony market. With the Congress-led UPA (United Progressive Alliance) voted back to power, the sector can look forward to speedy auction of the long-awaited 3G spectrum.

A significant portion of the rural population will witness phased growth in first-time Internet access and welfare programs covering telemedicine, e-governance and distance learning – propelled by 3G mobile broadband and WiMax.

While the 3G network would infuse better services for subscribers and enhance revenues from VAS (value-added services) for operators, the introduction of MNP will offer users the convenience of retaining their mobile phone number even after switching between networks and operators.

Mobile payment and commerce for micro-transactions is also expected to attract greater user-orientation.

3G-WIMAX : Simplifying the future

On http://www.ciol.com by Sunny Sen on 02 Jun 2009

INDIA: Amongst the innumerable potentials 3G has, network manageability is perhaps the most important one. In the coming years, with increasing Internet usage, a huge explosion of data will happen over networks. The other major area where 3G would make a difference is in the billing process.

For infrastructure providers 3G will be a value-add during slowdown, as they would get to put in a lot of new developments. Layout of next generation networks that are 3G compatible will help in better manageability of services over the networks. Even service providers believe that 3G would make the entire mobility space much more accessible. The government, though, has to look at 3G with a much broader perspective. The broadband connection, as they have not reached the set target, will also benefit with 3G coming to India.

Looking at the manageability front, 3G will not only help in managing new services, but also fall in line with 2G and 2.5G services. It will give a whole new experience of network management at the back end. “As a 3G network is downward compatible, SPs would prefer to upgrade their existing networks so that with increased bandwidth they can offer high-bandwidth applications and services to their 3G customers, as well as serve more 2G and 2.5G customers on the improved network,” says Vish Iyer, vice president, service provider, Cisco India & SAARC.

3G Billing Process

In India there is a larger base for pre-paid customers compared to post-paid and so there is a greater need to simplify processes for the same. With 3G services there is a new advent in the next-generation voice, data and content services. And 3G billing services will give operators the opportunity to handle and retain the loyalty of pre-paid subscribers.

“Billing systems must cope with the dichotomy in business processes and the complexity in operations for accurately billing pre- and post-paid subscribers. This is a challenge that operators must address as it adds additional pressure to the bottom-line,” says Paresh Shah, vice president, information management, Convergys India. For post-paid customers it would help the operators to offer innovative services on demand like real time balance tracking and notifications. This will actually become the handiest tool to operators as they are working to limit credit exposure from post-paid subscribers and provide the necessary cross subscription discounts and invoice generation that subscribers demand.

“In 3G, services priced differently will be posted in one bill. Apart from that a number of new parameters for calculating charges can be used like number of packets, uploading and downloading data, QoS, location and content. This will give rise to complex methods of billing,” says Tamal Bardhan, marketing head, Usha Comm.

Easier Manageability

Not only on the billing side, but also on the network deployment side 3G is taking things forward. Solutions and services are getting simpler and handier. Enterprises and vendors have already started making futuristic deployments for the new business opportunities that 3G would bring in the network space. 3G’s most important attribute will definitely be better infrastructure management.

“3G will help service providers manage their existing infrastructure better and remain competitive in a mobile number portability (MNP) regime. It will also generate a more addressable market to the GSM service providers. They can go back to their existing customer base and provide them with enhanced data services” says Animesh Sahay, head, telecom business, India and SAARC, Juniper Networks.

GSM and VAS are two other areas where 3G would be having a great impact. We are seeing a growth of around 5 to 6 mn users per month in these areas. The bandwidth provided right now is nowhere close to what we would have once 3G services are started. This would essentially lead to easy trafficking of data over the networks.

3G will not only make its presence felt in cities and towns but also bring in better and faster networks to rural India. “Looking at the country’s broadband penetration through copper and coax; wireless technologies are becoming prominent. 3G and WiMax will ensure that remote and rural areas get networked. Thus 3G is a positive sign of the growth of the Indian telecom industry provided the government supports it equally,” says Jayesh H Kotak, vice president, product management, D-Link India.

In the years to come 3G would make a lot of difference in making business models more innovative. 3G and WiMax will help solve the problem of low broadband penetration in India to a great extent. It is high time the government realizes the need and use of 3G. In a fast growing economy these technologies have the power to change the development roadmap of the country.

Data Matters

The current 2G network limits the download speed to nothing more than 30 to 40 Kbps, though the ISPs claim to provide much more. Even after the use of Edge technology one gets 384 Kbps of uplink and 171 Kbps of downlink. 3G is expected to sort out these problems. For enterprises 3G would bring in a lot of scalability and performance based application cutting short time constraints. 3G networks will be 2G and 2.5G compatible as well. Consolidation would bring down the costs for the company.

Apart from the bandwidth, 3G would also enable compressed data over the network. This would in turn maximize and increase WAN link by reducing the frame size, thereby allowing more data to be transmitted over the link. Though at this point we do not need much data compressibility as the transmission will be through fiber.

3G allows for transferring voice in networks much more efficiently than 2G and enables efficient VoIP in the future. This leads to decreased cost per bit and voice minute for the operator, and eventually for consumers. “Today’s networks are many times more efficient than early 3G networks and will evolve to LTE which is again three times more efficient than current 3G networks,” says Randep Raina, head, 3G India, Nokia Siemens Networks.

Looking Ahead

Will things stop only with the infrastructure developments of networks in Delhi? BSNL and MTNL are very differently placed in comparison to other private players. It is not yet known when 3G auctions will happen and which companies will be in the spectrum run. With a huge amount of investment only to acquire license, a lot of other costs would be involved when it comes to network building and implementation.

But the high costs will lead to new services making its way into the market, especially the urban areas. “Unlike 2G, in 3G one has to come up with very innovative applications and tariff plans. If operators are able to come up with new services there surely is a lot of money to be made,” says Subhendu Mohanty, country head, home & networks, mobility business, Motorola.

It perhaps goes without saying that vendors are looking at 3G because it is one of the areas that would bring them enough revenues. For instance, in case of Motorola their deployments for MTNL in Delhi alone are close to Rs 300 crore.

Undoubtedly, 3G will definitely bring in manageability. With obsolete billing processes and difficult round ups it is an urgent need for the communications industry to head towards 3G. For quite some time, 3G has been a vision and a topic of discussion, but unfortunately, implementation is nowhere in sight.