Latest Telecom News (9th -14 th August)

          1.    Piramal buys 5.5% stake in Vodafone’s India unit.

·         Piramal Healthcare is set to dish out Rs 2856 Crores for a 5.5% stake in Vodafone’s India unit.

·         With this transaction, Vodafone has now satisfied the regulation of 26% of having the company’s shares with Indian investors.

·         Piramal Healthcare with this transaction is contemplating various exit mechanisms.

·         Currently, Infrastructure Development Finance Company (IDFC) and Mr. Analjit Singh, Chairman of Max India, hold 24% stake in the company.

·         After Vodafone’s buy back of Ruias’ 33% holding in Vodafone Essar and this current transaction, it will have approximately 69.8% in the venture.

      2.    2G: Reliance Telecom denies allegations.

·         Reliance Telecom Ltd (RTL) has denied allegations that Swan Telecom (ST) was its front company.

·         CBI has alleged that RTL used ST as its front company to circumvent the telecom policy.

·         The moot point was that RTL has a stake of 9.9% in ST.

·         The regulations laid out by DOT say that a telecom company with licence, from holding over 10% stake in another telecom company.

·         RTL has reiterated that at the time ST was granted 2G licence, it didn’t have any stake in the latter and hence can’t be held liable for criminal conspiracy.

·         RTL has also said that Swan was not its associate company, adding that it did not have any say in deciding Swan’s board members.

            3.    Tata Comm posts Rs 258 Crore loss and MTNL widens loss to Rs 850 Crore.

·         Tata Comm reported a net loss of Rs 257.9 Crores for the first quarter ended June 30, 2011. In the same quarter-previous year, it reported a net loss of Rs 240.4 Crores.

·         Meanwhile MTNL has widened its net loss by 88.45% at Rs 850 Crores. It was mainly due to expenditure on staff cost and retirement benefits.

·         MTNL’s operating revenue stood at Rs 813.18 Crore during the period as compared to Rs 952.95 Crore in the corresponding quarter of the previous year.

·         Its revenues are under tremendous stress on account of being present in Mumbai and Delhi only and growth in telecom sector reached a saturation level.

             4.    Uninor, Etisalat DB among most congested networks: TRAI

·         Uninor, Etisalat DB and Aircel have the most congested mobile networks, according to a report by TRAI.

·         TRAI has been monitoring the congestion levels at Point Of Interconnection (POI).

·         POI is a parameter which signifies the ease with which a customer of one network is able to communicate with a customer of another network.

·         TRAI has notified the operators that they should have less than 0.5% congestion levels. So out 200 calls between two operators, only one call should face congestion.

·         Uninor, with 27 million subscribers, has blamed the larger operators for not giving adequate points of interconnection.

·         Overall, TRAI report shows that the congestion has improved. The number of POIs having congestion has decreased from 153 in December 2010 to 102 in March 2011.

5.    Vihaan Networks get award.

·         The Universal Service Obligation Fund (USOF) under the Department of Telecommunications has awarded certificate of successful completion of project to Vihaan Networks Ltd (VNL) for a new technology to address the challenges of the rural telecom services.

·         VNL had entered into a MoU with the USOF in September 2009, and has successfully completed the pilot project for demonstration of the capabilities of its rural solution in Alwar District of Rajasthan.

6.    Reliance Communications, Tata TeleServices worst hit by MNP.

·         Reliance Communications and Tata TeleServices were the biggest losers due to introduction of MNP, according to Department of Telecom (DOT).

·         Reliance has lost around 11.5 Lakh subscribers and Tata TeleServices has lost 3.7 Lakh subscribers.

·         State-run Mahanagar Telephone Nigam Ltd and Bharat Sanchar Nigam Ltd lost 40,366 and 5,73,142 subscribers, respectively.

·         MNP was launched in Harayana on November 25, 2010 before a pan India layout on January 20, 2011.

·         As per TRAI, about 13 million subscribers have requested for a change in service providers until June, 2011.

·         Surprisingly, the incumbent giants are the ones that have gained the most.

·         The maximum number of porting request have come from Gujarat (12.98 lakh) followed by Maharashtra (10.32 lakh) till June 30. About 10.5 million subscribers had used MNP as on May 31.

7.    Reliance Communications increases call tariffs by 20%.

·         Following the other incumbents, Reliance Communications (RCom) has increased call rates by 20% for both GSM and CDMA.

·         The rates have been increased from 1 paise to 1.2 paise.

·         RCom has said that the hike in tariffs is in response to the inflationary pressure in the country.

·         For GSM services, hike applies to within Reliance’s network and on other network.  For CDMA, hike applies only to calls made to network of other telecom operators.

·         As per the Telecom Regulatory Authority of India data, RCom added 2.10 million new subscribers in June, taking its user base to 143.26 million.

8.    DOT gets info on eligibility of 85 new licences.

·         Last year, DOT had served 119 show cause notices to various operators of which 85 were for those ineligible to get licences.

·         Telecom ministry has received information from the Ministry of Corporate Affairs with regard to the eligibility of these 85 new licences.

·         The Telecom Ministry is also seeking the Attorney General’s view for the legal view, stated DOT secretary Mr R Chandrasekar.

·         Earlier the Telecom Ministry has informed Public Accounts Committee (PAC) of the show cause notices that it had issued to the 13 companies for the termination of their licences.

ü  DOT has said that the main objectives of NTP-1999 were to increase teledensity and affordability, while maintaining a level playing field.

ü  It pointed out that TRAI had not recommended any methodology for auctioning 2G spectrum in its report of 2005, 2007 and 2010 related to telecom licences and spectrum allocation.

ü  DOT had pointed out that the CAG had not considered recommendation of TRAI made that spectrum in the 800, 900 and 1800 MHz band (presently used as 2G spectrum) should not be subject to auction.

9.    Now build your own web site.

·         Mahan agar Telephone Nigam Ltd (MTNL) has tied up with Akmin Technologies Pvt Ltd to launch ‘Mobile Web Site Builder Service' for its 8 million mobile subscribers in Delhi and Mumbai.

·         Users will be able to build and own a website at just Rs 75 a month.

·         It will immensely benefit small businesses and government agencies.

·         The service allows users to create and publish a website on a mobile or PC.

·         To initiate the service, MTNL mobile users will need to send SMS “MSITE” to 55012 from their MTNL mobile phone.

·         Mr Sridhar Pai T., CEO of Tonse Telecom, an independent telecom research and consulting firm has said that as India's Internet usage builds up, the need to quickly create and publish personalized Web sites will grow.

10. Retail may help 3G gain customers.

·         Researchers at IDC have said that the use of SMS on basic mobile phones to keep in touch with the customers could increase the chances of these customers gradually shifting towards 3G enabled mobile phones.

·         Mr Ivano Ortis, Head-International, IDC Retail Insights, said rather than be held down by basic phones, retail could boost the growth of smart phones. “Retailers should use a mixed-mode approach so that both smart phone users and people who use basic phones can benefit,” he said. Through a correct mix of traditional channels and innovative features like Quick Response (QR) codes, a barcode made up of geometric shapes instead of stripes that smart phones can read, retailers can invite consumers passing by high-traffic locations close to an outlet to take advantage of promotions, he pointed out.

·         People who use such SMSes on their basic phones are expected to graduate to smart phones because scanning QR codes is more convenient than sending SMSes.

·         Retail is one of India's largest industries and according to a study by AT Kearney, the retail sector in India is expected to touch $635 billion by 2015.

11. Reliance Communications (RCom) launches 3G Tablet.

• RCom has launched a tablet priced at Rs 12,999, bundled with attractive offers. RCom’s aim has been to leverage its 3G network.
• The tablet is a 3G and WiFi enabled Android device that works on RCom’s IP-based 3G network.
• It supports 32GB of data storage, GPS, card reader and push email services.
• The tablet was manufactured by China’s ZTE.