Economic Times speculates - “Keep the number, kick the network“! Under number portability, a subscriber can retain his number even while switching to a new operator.
This could be big news for the Indian telecom industry and its users. With number portability, operators loose their biggest stickiness-factor i.e. number lockin. This is good in general for the consumer since the operator has to do more to please him. Also, Value Added Services (Data) could be a major beneficiary.
“We will come out with the consultation paper on mobile number portability within two weeks,” said Trai chairman Pradip Baijal. Trai feels there isn’t much competition in fixed services, and sees no need to implement number portability here…
However, the biggest obstacle in number portability is that it increases infrastructure cost by about 10%, and this may lead to an increase in tariffs.
UPDATE: Number portability unlikely to become a reality, at least in the immediate future
Reliance Infocomm which has a subscriber base of 11 million across 20 circles has been valued at around Rs 22,500 crore.
In the first major step towards untangling the cross-holdings in the Reliance group companies as part of the settlement between the Ambani brothers, the board of Reliance Industries Limited (RIL) on Tuesday decided to hike its stake in its telecom venture Reliance Infocomm to 65.9% by conversion of preference shares into equity.
The conversion price is Rs 32 a share (face value: Re 1). The move has also enabled the first possible authentic equity valuation of the company at around Rs 22,500 crore.
Economic Times scoops that the AV Birla group, which till last year was not keen on expanding in telecom and was looking to exit Idea is now considering a buyout of Cingular’s stake in the cellular operator. It has floated a proposal under which it could buy out both the Tata group and Cingular’s combined stake of about 67% in Idea.
Singtel, Maxis, Telekom Malaysia, Sistema are the other foreign companies showing interest in Cingular’s stake. Idea was formed as a joint venture between the Tata group, the AV Birla group and AT&T (Cingular) in 2000.
Hutchison Essar has to pay hefty carrier charges to existing NLD operators for routing mobile STD calls originating on its networks. With an NLD licence, it will have the option to lease fibre capacity at a fraction of current charges and also strengthen its tariff margins on long-distance calls.
In the absence of an NLD licence, Hutch-Essar has to rely on other NLDOs. Its variable payout to route mobile STD calls is huge, including access deficit charges (ADC) payable to BSNL, carrier charges payable to the rival NLD carrier and terminating charges payable to the network into which the mobile STD call terminates.
Economic Times reports that the proposed MTNL-BSNL merger has been put on hold due to MTNL’s reservations over becoming a subsidiary of BSNL.
MTNL recently withdrew its Rs. 1500 crore tender for 3G equipment. It also started providing international long distance (ISD) services in Mauritius where it had acquired licence to offer telecom services last year.
Press release talks about Indian activities of two venture capital firms supported by Nokia. BlueRun Ventures is a global venture capital fund focused on early stage companies in the IT, mobile, and consumer electronics markets; Nokia Growth Partners’ mid-to-late stage focus complements that of BlueRun Ventures.
BlueRun Ventures established its office in New Delhi in 2004 when it brought on Sujit Banerjee as a Principal. The fund invested in Pune based Nevis Networks in May of 2004. Nokia Growth Partners recently announced an investment in Bangalore based Sasken in April. In addition, BlueRun Ventures’ India office has significantly increased focus and activity with the addition of Vineet Buch as a Principal, and Vasudev Bhandarkar as a Venture Partner. The two will jointly work with Banerjee to manage BlueRun Ventures’ Indian operations.
The Minister of Communications Dayanidhi Maran recently announced a ‘OneIndia‘ vision of uniform call rates for local and long-distance calls, treating the entire country as a single market. Here is an article from Vikram Mehmi, CEO of Idea Celluar on the issues facing OneIndia.
Long-distance calls generally comprise three charges: the originating charge, the carriage charge and the termination charge plus the ADC. In order to make India One dream a reality, the carriage charge and ADC is what needs to be drastically reduced. The stage was set in the first phase when Trai (telecom regulator) announced a reduction in leased line charges by nearly 70%. This would presume a proportionate reduction in carriage cost for national long-distance operators (NLDO)—this is yet to happen. The ADC being paid to BSNL further complicates this situation…
The ability of a subscriber to call from one end of the country to the other already exists. The catch is that the call is routed through so many different service providers that the cost gets unduly inflated. To be able to make a call at one flat rate is an enormous benefit but will require the removal of existing (artificial) barriers to allow it to happen. At present, there is a complex system of access providers, long- distance providers and circles that result in a very intricate routing of calls from one place to another. This is further aggravated by the fact that all inter-circle calls must be handed over to a licensed NLDO for carriage across the circle boundaries.
Story on Visual Radio entering India. Had seen a demo of Visual Radio at CommunicAsia and came back impressed with it. I think it has the potential to be an alternative distribution channel and business model to iTunes. Availability of compatible handsets could be a limiting factor though.
“VRT handles the metadata related to the radio program and it has tools to build the interactive elements, like quiz shows, for the program.
VRT communicates with the radio station’s content management system, to receive the radio station’s playlist and synchronization information for mobiles. The playlist is used as a skeleton for the Visual Radio content. Once the playlist is available, a journalist or an editor can either automatically or manually generate the Visual Radio content,” informed Jutel business development director Arto Isokoski.
With a lot of FM broadcasters vying the increasing subscriber base in India – the concept is currently being evaluated by many with pilots in the offing. “We are discussing with three big Indian FM broadcasters owning several radio stations to provide this concept for their users. This would be out in the market soon. Nokia would be partnering HP in this regard, like in other geographies,” he added.
An insurance company, which refused to indemnify the owner of a lost mobile phone for the reason that she did not produce a copy of the FIR of the police complaint, has been ordered by a consumer court to pay the claim amount of Rs 8,700 along with compensation.
The National Insurance Company had repudiated Deepika Verma’s claim citing an “exclusion clause” that only a “Non-Cognizable Report was lodged mentioning that the cell phone was taken away by somebody” while the claim covers only “theft through force or violent entry or exit”.
Source: Rediff
News.com has a nice article precising NTT DoCoMo’s new mobile-wallet service called “I-mode Felica”. Operators in advanced mobile markets like Japan are looking at these kind of VAS to not only increase ARPUs but also stickiness / lockin of their subscribers.
“DoCoMo is moving to a post-I-mode business model based on Felica.” -Yasushi Yoshikawa, general manager, NEC
This article on Indian gaming market estimates the mobile gaming market size to be around US$3 million in 2004. On an average 2,00,000 games were downloaded via the GSM/GPRS operators - Airtel, Hutch, Idea, and BPL.
TRAI has issued a comparative study titled Financial Analysis of Telecom Industry of China and India. It gives a good snapshot of the two of the largest telecom markets in the world.
A comparison of usage pattern of GSM services shows that Indians use their cell phones more than their Chinese counterparts. In spite of higher usage, ARPUs in India are lower than China. This shows existence of fierce competition in India and tariffs, which are much lower than Chinese tariffs.
China subscribers: 674.5 million (325.4 fixed and 349.10 mobile)
India subscribers: 98.12 million (45.91 fixed and 52.21 mobile)
China telecom revenues: US$65.3 billion in 2004
Indian telecom revenues: US$17.78 billion in 2004-5
Also See: Indians more prolific mobile users than Chinese
Story on SMS Spoofing by The Hindu. Faking sender’s number in SMS is easy using some software front-end and the bulk SMS providers as the carriers.
For the bulk SMS providers, one way to control this menace and not get involved in the legal tangles is to authenticate their customer’s “sender” mobile number. This can be done by sending a one-time security code to the customer’s mobile during the registeration process. Customer completes his registration by providing that security code in the registration form finally. This ensures that the “sender” mobile number exists and belongs to the customer.
A Bharath Sanchar Nigam Limited (BSNL) engineer said that mobile telephone users could easily find out if they have received a fake SMS by going to message options menu and checking the SMS message details. The details include the mobile phone number of the message sender and the message centre number of the cellular service provider. “If it is a fake message purportedly from a BSNL number, the message centre number would not be that of the BSNL service. It would be that of the SMS gateway hired by the company that offers the web-based spoofing service.”
Here is the latest round of numbers as reported by ET. Note the degree of difference between penetration rates of Mobiles, Internet and Broadband in India.
For the quarter ending March 2005:-
Annual Mobiles growth (March 2004-5): 55%
Annual Telecom growth (March 2004-5): 28.59%
Gross Telecom subscribers: 98.41 million
Fixed Line (including WLL-F): 46.19 million
Mobile subscribers: 52.22 million
Internet subscribers: 5.55 million
Broadband subscribers: 1.83 lakh
For the quarter ending December 2004:-
Effective mobile local call per minute charge: Rs 1.20
ARPU (GSM): Rs 398
Average Minutes of Use per month (GSM): 325
Back from a long break in blogging. Was attending the CommunicAsia 2005 conference and expo in Singapore. Some quick summarising points:
- Convergence: Convergence of devices, access, content, technology, services.
- Ecosystems: Operators, Middleware providers, Content Publishers, Device manufacturers working together to create and share a larger pie.
- 3G: Its here but still not arrived. There is widespread deployment in some markets but users have not taken it up yet due to lack of compelling content and services.
- Content: Open Access vs Walled Garden (related to the Ecosystems point above). Operators are focusing on content differentiation in VAS to increase ARPUs and stickiness.
- VisualRadio: Liked what I saw. Has potential business models in the “Music phone” strategy of operators / device makers.
- Style vs Substance: Motorola vs Nokia. Motorola’s strategy is of stylish phones like Razr, Pebl; Nokia’s concentrating on the features of Series 60 smartphones.
- Taiwan: The market to watch out for the convergence of WLAN and Cellular
Singtel has bought a 45% stake for $118 million in Pacific Bangladesh Telecom, the third-largest cellular operator in Bangladesh. Bangladesh has a 3.9 percent mobile penetration rate with 5.4 million mobile phone users in a population of 140 million.
Facing a mature and tiny home market, SingTel has spent S$17 billion ($10 billion) in recent years buying operators in high-growth Asian nations with fewer cellphone users, and in the bigger Australian market. It owns Optus Ltd., Australia’s second-largest phone company.
It now derives about 75 percent of revenues and two-thirds of pretax earnings from operations outside Singapore, where more than nine in 10 of the 4.2 million people own a cellphone.
Singtel owns a 30.84% stake in India’s largest operator Airtel.
