Latest Telecom News (13th September - 21th September)

1.    Good Coverage: Reason for service provider selection.

Good coverage tops the list for customer preferences for a service provider. The above finding was from a survey conducted by OPSBUDS.

The survey was conducted in the 4 metros, and an overwhelming 80% have responded that the network connectivity is a major factor in deciding which operator is to be selected.

So bundling the new handsets with free talk time from a service provider doesn’t influence customers to buy such products.

The survey results do make some sense in a way that if there is good connectivity and network, the calls can be made and received at any time and place thereby driving usage and directly impacting the revenues of the operators. So in a way the price wars, which are affecting the ARPU’s, don’t make any sense for the operators.

2.    Mobile OS making news almost every day.

For quite some time mobile operating systems are making headline news. The most basic of mobile phones are also embedded with dual core processors, music play back etc.

a)    The big news was that Google announced that it would acquire the handset division of Motorola. So the customers feel that the Android experience will be better with Motorola phones.

b)    Android v 4.0 (Ice Cream Sandwich) is going to be launched this November. As Google prefers to name its new Android OS with confectionaries in alphabetical order, the name doing rounds is Jelly Beans.

c)    Intel has joined hands with Google to provide atom sized chips to Android devices. This after the failure with MeeGo venture with Nokia.

d)    Nokia has joined hands with Microsoft for its Window phone 7.

e)    HTC is also planning to do a Google. It has plans to acquire webOS from HP.

f)     Microsoft showed off its Windows 8 preview for smart phones in a conference recently.

g)    Two Android based OS – Baidu Yi and Aliyun are introduced by Baidu & Alibaba respectively.

3.    Samsung to triple the phone capacity.

Samsung, leading mobile phone provider, has announced that it will triple its existing capacity at its Noida plant. It plans to invest $70 million for the same.

Samsung India is operating two R&D Centers at Noida and Bangalore to support its business operations in the country. Samsung India Software Operations, the Bangalore R&D Center develops Protocol and Platform software for Mobiles.

4.    One circle: Telecom policy 2011.

The new telecom policy that is to be unveiled this November, envisages at making a one circle policy for the entire country.

According to Economic Times, the new policy proposes to extend MNP during roaming (both when in a different circle and country). Currently MNP is restricted with a circle.

The policy also focuses on domestic manufacturing of telephone equipment to prevent the huge foreign exchange outflow and to ensure national security. The country currently depends on a large-scale import from China.

5.    Nokia’s market share under pressure.

Even though Nokia is the market leader with 39% in Indian Mobile phone market, its dominance is under threat from other MNCs like Samsung and Indian companies like Micromax, Karbonn, Lava etc.  Nokia had 49.3% market share in 2010.

The Korean mobile phone company Samsung is quickly growing its market share during the last few years. It reported a revenue growth of 21.7% during last year as against Nokia’s flat revenue growth. Nokia’s revenue during 2011 was Rs 12929 Crores against Rs 12900 Crores during the previous year.

The major reason for this low growth is due to absence of product ranges like dual SIMs, which are very popular in India.  It is estimated that nearly 50% of the handsets sold in India are dual SIMs phones, which were not produced by Nokia till recently.

6.    Encrypted mobiles to top Government officials.

Government is planning to provide encrypted mobile phones to its top leaders and officials to ensure uninterrupted communications during crisis situations.  Currently during natural disasters and terrorists’ attack, it has increasingly become very difficult to communicate due to huge surge in number of calls, which leads to clogging of lines.

These encrypted phones will work on reserved radio frequency. Government is preparing a list of officials who will be given these mobile phones. This may require approvals from various ministries, as these phones will be working on a different frequency.

Apart from ensuring smooth communication, these phones will be secured in the forms of end-to-end encryption, mutual authentication of the calling parties and protection from interception.

7.    Telecom Ministry clears spectrum allocation plan.

Telecom Ministry has given its nod to National Frequency Allocation Plan (NFAP) 2011 for making available required spectrum. It also set aside some chunk of spectrum for trial testing by local equipment manufacturers.

Despite opposition from Information and Broadcasting Ministry and Department of space, Telecom Ministry has decided to free up 700 MHz frequency and S band for broad band services.

This move will be come as a welcome relief for the operators who are facing spectrum crunch leading to network congestion. The government has set the target of 100 million broad band subscribers by 2014.

NFAP 2011 was prepared by Wireless Planning Commission (WPC). WPC is the custodian of airwaves.

8.    Zen mobile to consolidate operations in Africa.

The Delhi-headquartered mobile handset maker Zen Mobile plans to consolidate its operations in the African nations of Kenya and Nigeria. The company has already started “test marketing” its operations in these nations.

Zen on Tuesday launched its touch and type dual SIM phone – M72 priced at Rs 1,999. Industry sources say that the dual SIM portfolio currently accounts for nearly 28 per cent of the handset market.

According to Mr. Gupta, the company is aimed at doubling its monthly sales from 50,000 to one lakh units in West Bengal by this fiscal. Zen is also targeting a 25 per cent jump in sales to nearly Rs 500 crore this fiscal.

9.    Telecom Ministry proposes new body to manage spectrum.

The Ministry of Communication and IT has proposed to set up a new entity to manage and regulate spectrum allocation.

To be called the Spectrum Management Commission, the new body will be set up through the proposed Spectrum Act. The Commission will subsume Wireless Planning Coordination wing of the Department of Telecom and will get wider powers including dispute settlement, pricing and regulations related to spectrum.

Dos

·         Powers to punish operators hoarding spectrum.

·         Adjudicate disputes between operators on issues related to spectrum.

·         Administer spectrum re-farming fund.

·         Monitor, inspect and licence wireless equipment.

·         Rules for spectrum sharing and trading.

Donts

·         Licencing will continue under DOT.

·         Government will have final say on spectrum issues.

Latest Telecom News (6th September- 12th September)

1.    Come September 27^th only 100 SMSes per day.

It is time to rethink about the communication modes for high end SMSes users. From September 27^th 2011, the mobile operators are ordered to scrap their unlimited SMSes packages (currently maximum is 500/day) and introduce the 100 SMSes/day packages to meet TRAIs regulations.

Telecom Regulatory Authority of India (TRAI) finally announced 27th September 2011 as the date of implementation for Telecom Commercial Communications Customer Preference (Sixth Amendment) Regulations, 2011 to stop the menace of telemarketing SMSes.

As per the stipulations the operators can either introduce 100SMSes/day or 3000 SMSes per month.

If a customer registered under the National Customer Preference Register (NCPR) receives a call or SMS from Telemarketing Company, then the company is liable to pay fines ranging from Rs 25,000 to Rs 2.5 lakh.

2.    DOT: Exit policy on the anvil.

Hyper competition with 15 players and each present in almost all circles, tremendous strain on profit margins in the telecom sector. Welcome to India.

In 2008, many new licences were awarded. But either some players have not met the roll out obligations or have not received the spectrum itself. So the Telecom Commission, apex decision making body, has advised DOT to prepare an exit policy for these operators.

Loop Telecom has expressed its desire to leave this hyper competitive market and surrender its licence. In any case, the spectrum reserves with DOT will increase. This will come as a relief to pan India operators who are in desperate need of this natural resource to decongest their networks.

Abundant spectrum will translate into reduced prices of spectrum.

3.    Vodafone launches Facebook Phone “Vodafone Blue 555”.

Vodafone, leading mobile operator in India, has launched Vodafone Blue 555 in India at Rs 4950. The handset also comes with unlimited data usage on Facebook Free for 1 year.

This phone is designed to bring the Facebook experience into the very core of the handset.

But the success of Vodafone Blue is not given, as smart phones, with Android OS, have enabled easy access to Facebook via the web.

Features

The device has fully integrated Facebook experience, QWERTY keypad, Optical Track Pad, 2.4″ QVGA screen, Mobile Internet with Email, IM, Opera Mini / Opera 5 Web browser, Integrated Music Player with 3.5mm Jack, 2 MP Camera, Bluetooth, 16 GB expandable memory, 2 Year Warranty. Facebook is built into the handset’s core – it’s running the moment the customer turns on the mobile phone.

4.    BSNL hikes 3G Data Tariff.

The operators in India, even though going through a period of turbulence, are having a good time.

In general if a competitor hikes the tariffs, the other stays put and try to increase the market. But of late in the Indian Telecom Industry, things are working the other way round.

BSNL has joined the band in increasing the 3G data tariffs. Now the rate of 3G data will be 4paise/10KB instead of 2paise/10KB.

5.    Frost & Sullivan: Future of Mobile Broadband lies in LTE.

With the current 3G networks proving to be incapable of handling the growth in mobile data, mobile operators in India, Saudi Arabia, and the U.A.E. are soon expected to migrate to 4G technologies to accommodate the surge in data traffic.

A Frost & Sullivan Report indicates that LTE is expected to lead the shift toward 4G technologies in Saudi Arabia, the U.A.E, and India, with the developing ecosystem and increasing support from equipment vendors. The Report also recommends commitment and support from equipment manufacturers and mobile operators to drive the growth in the LTE market.

LTE and Worldwide Interoperability for Microwave Access (WIMAX) are the two competing 4G technologies expected to drive the growth in mobile broadband, globally.

6.    Microsoft Apps for Symbian Belle Smart phones.

Nokia has announced that the existing smart phones with the Symbian Belle OS will be updated using the Microsoft apps. This will be an add-on to the already present security and other features present in the Symbian.

At the start of 2012, Microsoft plans to introduce MS word, excel, and power point as native applications for mobiles.

7.    IMI launches SMS in local languages.

Hyderabad based IMI mobile, mVAS provider, has developed an application that helps to access the SMS in the local language.

The application named “My SMS” helps to access content in local language. The plus point of this application is it is scalable where in more languages can be added. This application is for sure to drive the usage of mobile services in rural areas and also empowering the rural populace.

8.    US frown at preferential treatment to Indian firms.

The United States government has raised concerns over some of the telecom related policies in India. The objections include preferential treatment given to telecom and electronic products made in India. These policies have been approved by the Committee of Secretaries and await the Cabinet’s final ratification.

Three points of concern are:

a.    Regulating of procurement by private telecom firms by the Government:

The Ministry of IT and Communication has floated a proposal to reserve 30% of all electronic equipment procurement to items manufactured in India.

As per WTO (of which India is a member), the government has the authority to protect local products only when procured for government purchases.

So the US has raised its point that how is that regulating procurement by private firms come under government purchase.

b.    Concerns raised over the monopoly of ISRO in DTH services:

The US has questioned the purpose of preventing the foreign telecom firms from selling satellite services directly.

c.    The US has also sought an update on TRAI recommendations on giving equal access to cable landing stations in India to foreign companies.

9.    Philips mobile enters India again.

Philips mobile phone is entering the Indian market again after a long hiatus of 8 years.

China based Shenzen Sang Fei (SSF), which sells mobiles under the Philips brand has re-entered India after 2003.

SSF is a joint venture between Philips and China Electronic Corporation (CEC). In 2007, Philips exited the joint venture and culminating in the mobile business being acquired by SSF.

10. TCIL refuses to dilute stake in Hexacom.

Telecommunication Consultants India Ltd (TCIL) has rejected a proposal to dilute its stake in Hexacom through an IPO.

Bharti Hexacom, a joint venture between Bharti Airtel (70% stake) and TCIL (30% stake), offers mobiles services in Rajasthan.

TCIL argues that if there is a proposal of issuing fresh stock, then TCIL would have its stake reduced to 24% and thereby losing its ability of enforcing shareholders rights. TCIL has also said that it should Airtel that should dilute its holding as it owns the majority stake.

Other grappling issues between them are the management fee imposed on Hexacom management for using Airtel’s brand and technical know-how. Airtel has also suggested that TCIL exit by shares offloading which was refused by TCIL on grounds that it will get a better evaluation at a latter stage.

11. Indian IT firms need to look at emerging economies for growth momentum.

The Indian IT industry, which is a USD 70 billion industry, might experience some slowdown in its momentum due to its dependence on the U.S economy, which is experiencing a very slow growth rate.

This has prompted fears of a protectionist approach being adopted by the U.S that would ban outsourcing and off shoring and creates jobs at home. However, experts feel that this would not be done as the govt. there has realized the pressures various sectors are under to run their state of affairs on a very tight budget.

However, it would be wise for the Indian IT industry to look at other verticals such as health and transportation. Right now it has a 15-20% of the global market with a potential to grow much bigger by refocusing its efforts on the emerging market, especially Asia, which is where the centre of economic gravity is shifting. The domestic market is witnessing strong demand from sectors such as banking, telecommunications, insurance, government and utilities.

12.  Dell launches new generation storage solutions.

Leading computer marketer Dell has announced a new generation storage solutions and supporting software to address data management requirements of virtualized data centers.

The new storage arrays and virtualization tools can help our customers run highly optimized and efficient data centers by automating configuration and improving performance without forcing forklift upgrades. It has introduced the Equal Logic PS6100 and PS4100 family of virtualized, IP-based storage offerings.

Together with its new Equal Logic firmware version 5.1, its storage solutions will seamlessly integrate into existing environments without downtime or a major overhaul. It offers a proactive support that helps all their segments of enterprise customers optimize and automate the management and protection of their data.

13. Tata Consultancy Services bids $500 mn for 80% stake in Lufthansa IT Systems.

India's largest software services exporter, Tata Consultancy Services, has put in a bid valued at $500 million to acquire a controlling stake in Lufthansa IT systems, the captive information technology unit of the Frankfurt-based airline.

Hewlett Packard-EDS and IBM were also in the fray to buy a stake in the unit but TCS may be able to propose a structure that would make it compelling for Lufthansa to consider them as a favored partner. If TCS emerges as a successful bidder for the unit it is likely to fund the acquisition entirely through internal accruals.

14. Department of Information Technology expects 11 states to adopt e-payment gateway by March, 2012.

The government will throw open a single payment gateway for e-governance services in 11 states by March, 2012, which will facilitate collection of fees for licences and other chargeable services over the internet. Around 20 services, including those provided by both the central and state governments, will be linked to the payment platform in the next two to three months, enabling citizens to make online payments and doing away with the need to visit government offices.

Chhattisgarh, Maharashtra and Goa will be among the early adopters of this platform. The technology provider for this platform, National Securities Depository Limited (NSDL), will be paid on the basis of each transaction made.

Assuring NSDL that a minimum of one crore transactions will take place every year through this platform the government has signed a revenue gap funding agreement with it. Under the agreement, if the numbers of transactions in a year are less than a crore, the government will compensate NSDL for the lower volumes on the basis of the commission promised. However, if the number of transactions through the platform touches the one crore-mark, the government will not have to pay any amount to NSDL.

Latest Telecom News (28th August - 5th September)

1.    Tata Teleservices launches Mobile Social Network Platform.

Tata Teleservices along with IIT Bombay’s centre of excellence in telecom (TICET) has launched the Mobile Social Network Platform (MSNP).

This is a unique and powerful social recommendation to develop personalized applications. MSNP is operator agnostic and helps to provide the right information to the right person at the right time.

2.    Smart phones running on EV-DO launched.

The competitive smart phones market just keeps getting more and more competitive with new smart phones being launched almost every day.

HTC announced the launch of HTC EVO 3D smart phone powered by Qualcomm snapdragon S3 processor. It offers the ultimate glasses free 3D experience. It runs on the Gingerbread (2.3) version of Android.

MTS, CDMA mobile service of Sistema Shyam Teleservices, has launched two new low cost Android phones MTS MTag 3.1 and MTS Livewire. These two phones also run on the state-of-the-art CDMA EV-DO technology.

3.    MTS and TTSL launch broadband services on EV-DO Rev2 network.

MTS India CDMA mobile and EVDO data service operator created history by launching world’s first CDMA EV-DO Rev B network in India.

To experience the full potential of EVDO, MTS has introduced MBlaze Ultra – a special dongle providing data download speeds of 9.8 megabytes per second.  It enhances the BTS cell capacity, spectrum efficiency and peak rate, achieving high speed rate as high as 4.9 Mbps in single frequency carrier and 9.8 Mbps in two frequency carrier bundle. It is to be launched in Jaipur initially.

Within hours after MTS announced the launch of MBlaze, TTSL announced the launch of Tata Photon on EV-DO network.

EVDO is an acronym is “Evolution Data Optimized”. It is a standard defined by the Telecommunication Industry and the official name is CDMA2000, High Rate Packet Data Air Interface. It was developed by Qualcomm.

4.    Tata Docomo’s quality up with TRAI bench markings.

In the last few weeks Tata Docomo’s new ad with the theme “No getting away from the network that connects always” has been doing the rounds. This new message is also reinforced from none other than TRAI. As per the report from TRAI, Tata Docomo network has delivered on all network quality parameters, as set by TRAI.

Since the launch of 3G services in India, network connectivity has left a lot to be desired. So continuity of network is emerging as a strong customer satisfaction than the geographical expanse of coverage.

5.    Micromax is 12^th largest Mobile Phone Brand.

Micromax, third largest mobile brand in India, has achieved the milestone of being the 12th largest handset manufacturer with 1% share globally.

As per the report by Strategy Analytics for Q2-2011, Micromax topped the micro vendor rankings, shipping an impressive 4 million handsets worldwide. It is now larger than Japanese brands such as NEC and sharp. It is also ahead of Lenovo and closing on Samsung.

Micromax has a market share of 8% in India and third in Indian market after Nokia and Samsung.

The report tracks the world’s 30 largest handset vendors on a quarterly basis. Also, with the entry of 25 new micro vendors this quarter, the global legitimate handset shipments increased 12% annually to reach a record second quarter total of 358 million units in Q2 2011.

6.    MNP has had a negligible impact in India.

Mobile Number Portability has had a limited impact in India since its launch in November 2010 by Prime Minister Dr. Manmohan Singh in Haryana.

MNP requests handling has been entrusted to Syniverse and Telcordia for Zone I and Zone II. As per TRAI reports, these two companies have received 129.85 lakh requests at the end of June 2011.

The requests have been very low due to low prices, high competition and very high level of prepaid customers. The maximum number of MNP requests has come from Gujarat (12.98 lakhs) followed by Maharashtra (10.32 lakhs), which are in Zone 1. Karnataka is leading in MNP requests in Zone 2 with 9.83 lakh numbers.

7.    Two new mobile services launched at India Telecom 2011.

Communications and IT Minister Mr. Kapil Sibal launched two new mobile applications on the occasion of India Telecom 2011. Digital Mandi, developed by BSNL in collaboration with IIT Kanpur, will give the latest information to farmers about market prices of their produce.

The other application developed at IIT Bombay is an intelligent mobile social networking platform (MSNP) similar to Facebook or Orkut based completely on mobile phones.

8.    Dish TV introduces DTH portability.

Dish TV has launched Dish Freedom, a conditional access module (CAM) device which enables DTH portability. The concept is similar to number portability in the telecom sector.

About 20% of the 33 million DTH subscribers are inactive and therefore these inactive subscribers form a substantial market segment.

The device being launched in select key markets is priced at Rs 990 and this device can be plugged into the port of all BIS compliant set top boxes.

9.    BSNL pushes for common wireless network.

BSNL has proposed setting up a common wireless network for making available broadband services in rural areas. BSNL is of the view that instead of multiple operators setting up their own infrastructure, a single network should be setup with the help of the Universal Service Obligation Fund (USOF) from the government. This was however rejected by the Finance Ministry on grounds of anti-competitive behavior.

The suggestion by BSNL is similar to the National Optic Fibre Network (NOFC) project being undertaken by the government of India to create a pan-India wireless broadband infrastructure. The cost of the infrastructure is around Rs 20,000 Crores.

The rural tele density is around 36% and urban tele density around 163%. So the telecom revolution has still not reached the Indian rural hinterland.

10. Tata Docomo opts for Vanu’s radio access network.

Tata Teleservices has joined hands with wireless network infrastructure provider Vanu for deploying the latter’s radio access network in the former’s network.

TTSL wants to improve the quality of its services to its urban customers.

11. Qualcomm announces initiatives to boost broadband uptake.

Qualcomm has announced a slew of initiatives with its partners in India. It has announced the launch of a new 3D navigation device with Mapmy India. The device named CarPad, is a 3D navigation device designed for car travelers. It has in built 3G, Wi-Fi, and Bluetooth capability.

The mid Rs 5000 Smart phones with SSTL, EVO 3D devices with HTC, and with Sony Ericsson have been launched. The phones are running on Gingerbread 2.3 version of Android.

Qualcomm with Huawei, ZTE, Quanta and BandRich, has announced the launch of LTE TDD multi mode devices which will enable mobile subscribers to use the same device for 3G and 4G services. This assumes great significance to the operators in India.

Qualcomm has also launched the Radiophone project with Sesame Workshop India Trust to offer community radio services on mobile phones. Piloting in Gurgaon, it broadcasts high quality education content through radio. This service will reach the rural hinterland with the participants being children of age group from four to eight.

12. Vodafone to market SSTL data services.

Vodafone has signed an agreement with Sistema Shyam Teleservices Ltd to sell CDMA based data services on a revenue sharing basis.

Vodafone will market the CDMA dongle under Netcruise brand. The service will ride on SSTL network and infrastructure. Billing will be done by SSTL but Vodafone will get a share of the revenue generated.

Vodafone, which is predominantly a GSM based service provider, has said that the CDMA dongles would help it address a wider customer base. However the Netcruise tariffs are higher than the data plans under MTS’s own brand mBlaze.

13. Etisalat woes continue.

Etisalat DB’s international long distance telephony plan is in a soup with security agencies yet to give clearances to set up gateways in the country.

Intelligence agencies have raised security concerns about Etisalat DB’ parent body – Emirates Telecommunications Corp. This comes even as the company’s mobile licences are under the scanner for alleged involvement in 2G spectrum scam.

According to International Long Distances (ILD) licence conditions, Etisalat DB should set up at least on gateway within three years to fulfill its rollout obligations. Failing to do so, DOT has the rights to encash the bank guarantee submitted by the company.

The final decision is being entrusted upon the Ministry of Home Affairs (MHA) by DOT.

14. TDSAT dismisses Idea’s plea against DOT notices.

The telecom tribunal, Telecom Dispute Settlements and Appellate Tribunal (TDSAT) has dismissed the petition filed by Idea Cellular challenging the show cause notices issued by the Government on merger of Spice Communication with Aditya Birla group firm.

TDSAT is of the opinion that till DOT comes up with its decision, it would be improper to comment about the issue for now.

DOT has said that the merger went ahead despite it rejecting the merger on January 2010 and also alleged that Idea Cellular suppressed this information in its application for amalgamation of Spice Communication with Idea Cellular.

The Delhi High Court on July 4, 2011, dismissed Idea's plea and had directed the company to surrender the spectrum to DOT along with a penalty of Rs 1 crore penalties for suppressing fact. This was challenged by Idea Cellular before a division bench, which had on July 21 directed to maintain status quo over the licences of Karnataka and Punjab. It had also directed the DOT not to take any coercive step.

15. S Tel charges Tech Mahindra for service discontinuation.

New telecom S Tel has accused its IT partner Tech Mahindra of discontinuing its services without prior notification and S Tel has sought the intervention of the Telecom Ministry.

S Tel has being having discussions with its vendors for a moratorium on payment of dues due to a funds crunch. But the vendors have resorted to discontinuation of network equipment thereby resulting in network connectivity problems for its customers.