Latest Telecom News (24th to 27th July)

1.    Telecom services segment grew 15% in 2010-11.

·         The Indian Telecom services grew by almost 15% to post revenues of Rs 1, 66,168 Crores, up from the previous fiscal’s Rs 1, 44,600 Crores.

·         The services include cellular, fixed line, broadband and VSAT.

·         The mobile services market, the largest among all the communication services offered in the country, saw revenues grow by 16.6% to cross the one lakh crore mark.

·         As a whole the total revenue of the Indian telecom sector grew by 7 per cent to Rs. 2, 83,207 Crores for 2010-11 financial year.

·         But the revenue from telecom equipment segment declined by 2.52% due amendment in security norms.

2.    Telecom stock bullish following tariff hike.

·         Telecom stocks rose by 0.8% (148.99 points) on 25^th July.

·         It was mainly due to the hike in tariffs by Bharti Airtel last week. Airtel’s stock increased by Rs 22.05 or 5.37%

·         Reliance Communications stocks rose by 14.9%.

·         Recently, Bharti and Vodafone announced a 20 per cent hike in tariffs for on-net calls (on-net traffic accounts for 25 to 30 per cent of the total traffic).

·         Aircel, Idea also followed suit.

3.    2G scam: Behura drags in RBI Governor

·         Former Telecom Secretary, Mr. Siddhartha Behura has dragged in the RBI governor, D.Subbarao in 2G scam.

·         He has blamed Subbarao for not revising the 2G spectrum price in 2007 as the then Finance Secretary.

·         However, as reported by Business Line earlier, Dr Subbarao, the then Finance Secretary in a letter dated November 22, 2007, had in fact asked the Department of Telecom to justify how it was taking an entry fee of only Rs 1,650 Crore from operators in 2007 as this amount was fixed in 2001.

·         Behura also added that a meeting was convened by Subbarao on Dec 4, 2007 and mentioned that the fee were finalized. He insists that he joined as the Telecom Secretary in Jan 2008 and hence he should have been a witness instead of being behind bars as the decisions were taken before he took charge.

·         But the Govt has defended Subbarao and in fact hit back at Behura saying that it was really strange and unbecoming of a top official to make references to a meeting which he had no personal knowledge and no supporting documents to claim the same.

4.    Bharti Airtel launches 3G services in Kerala. Key cities included are Kochi, thiruvananthapuram and Kozhikode.

5.    BSNL: Spectrum costs and delay in execution of plans pulls down revenue.

·         State run telco BSNL is likely to announce a substantial revenue loss in 2010-11.

·         It is because of high spectrum costs and a long delay in execution of projects.

·         3G spectrum and BWA was given to BSNL and MTNL before the auctions took place and kept out of auction process.

·         The spectrum to both public sector companies was given under condition that the two will have to match the best price paid by the highest bidder in the respective telecom circles.

·         BSNL paid Rs 10,186.58 Crore for 3G spectrum and Rs 8,313.8 Crore for wireless broadband spectrum.

·         Deadlines for Various tenders like managed lease line network, Mpls Based Next Generation Transport (MNGT), mobile network expansion couldn’t be met.

6.    British Telecom set to exit Chennai Company ACCEL.

British Telecom (BT) is set to exit the 330 Crore Chennai based IT company Accel Frontline, listed on the BSE, in which BT has 51% stake.

BT acquired 51% stake in May 2007.

Back in 2007, the acquiring of stake by BT was hailed as the greatest moment in Accel’s history and believed that it could ride the BT wave to gain substantial business.

But that did not happen and this is seen as the reason as to why BT had decided to part ways.

7.    Tata Sky mobile access launched.

·         DTH service provider, Tata Sky, in association with Ryz Media Inc, has introduced Tata Sky mobile access, for Apple devices.

·         This application would allow/enable iPhones, iPads and iPods to remote control consumer electronic devices at home.

·         In addition subscribers can read upcoming programme information, read about movies and search for programmes based on title.

·         This application will also enable users to record their favorite programmes when on the move, which will coerce the users to use this feature of Tata Sky.

·         To use this application, an accessory needs to be plugged into the audio jack of the Apple devices.

·         Separate applications for Android devices will also be launched soon.

8.    Vodafone Essar’s mobile newspaper.

·         Vodafone Essar has announced its launch of mobile newspaper for its customers across TamilNadu.

·         The news will available in the form of a MMS and covers many genres of news.

·         It is available at Re 1 per day, Rs 5 per week and Rs 20 per month.

9.    Telecom the next big call for Loyalty Service providers - Accentiv.

·         Accentiv, an end-to-end loyalty solutions provider, has said the growth in organised retail and airlines is fuelling the growth of loyalty service providers in India.

·         The company is looking to invest in Analytics – an area which provides data on customer buying behavior and also track return on investments for corporate.

·         DTH and telco, Airlines and Retail Industries are fuelling growth in India and therefore Accentiv is looking forward to provide loyalty programmes to as part of the organizations customer retention programme.

·         It estimates that the loyalty market in India is anywhere between Rs 5000 – Rs 8000 Crores.

·         Given the hyper competitive environment in the Indian Telecom sector and very high customer churn in this sector, it is a good commercial venture for Accentiv.