Latest Telecom News (1st Nov - 8th Nov)

1.  Infotel acquires stake in Extramarks Education.

RIL’s Infotel Broadband has acquired a 38.5% stake in Extramarks Education Pvt Ltd.

Infotel Broadband Services Ltd is a subsidiary of RIL. Extramarks deals with school education and digital learning. This investment will definitely help Extramarks in further developing services and wider market penetration.

2.  India’s internet users top 100 million in Sept.

A survey conducted by Internet and Mobile Association of India (IAMAI) and IMRB, has found that the number of internet users in India has crossed 100 million (112 million), registering a growth of 11% against last year. This number is poised to reach 121 million in December 2011. With this India has become the third largest internet market in world

Findings

a.    Out of the 28 million active internet users in 30 cities, 89% use the internet for Email, followed by 71% for social networking sites.

b.    Of the 75% urban usage, 21% school children, 27% college students, 27% young men.

c.    Among India’s cities, Mumbai has the highest number of active internet users.

3.  Europe IT spending to drop – Gartner.

IT spending by companies in Western Europe will fall this year and grow only modestly in 2012 as their governments cut back on expenditure and investments due to Euro Zone crisis.

Gartner has forecasted that the enterprise spending on IT will fall 1.8% this year to 494.8 billion Euros and grow at 1.5% next year.

           Government’s IT spending will decline 4.8% in 2011 and 1.8% in 2012.

4.  Paymate and Nokia tie up for NFC.

Paymate has developed a unique and cutting edge NFC technology that enables to perform transactions by using a simple tap.

With the recent launch of Nokia’s NFC enabled phones, Paymate has partnered with Nokia to showcase NFCs capabilities to the Indian Market. NFC (Near Field Communication) uses radio frequencies to allow NFC enable phones to exchange information in real time with a simple tap of the phone against an NFC touch point.

5.  Airtel to disconnect mobiles lying inactive for 60 days.

Bharti Airtel has announced that it will start disconnecting subscribers who are idle for 60 days. This move comes in response to the DOT’s order for tightening the allocation criteria. And also Airtel has been facing a shortage of numbers.

These disconnected numbers will now be available for new users.

About 12% of Airtel’s 180 million subscribers have been found inactive. This is lower than the industry average of 30%

Implications

a.    Users with life time valid prepaid cards will be affected the most as now they have recharge their mobiles every two months instead of 6 months.

b.    Users with multiple SIMs may also be affected.

Users using a SIM card for giving it to a close friend who visit them from other companies.

6.  Top 4 IT companies on a hiring spree.

Cognizant Solutions juggernaut continues as the number of employees added at the end of the second quarter touching 12000.

This addition was partly aided with the acquisition of Core Logic with 4000 employees. But still Cognizant on its own was able to add 8000 employees which are just 262 short of what Infosys added.

           India’s leading IT firm, TCS added around 12580 employees. These figures show that
           business demand is still strong. Unlike the crisis in 2008 where the entire systems
           collapsed, the current crisis in Europe has not risen to such alarming magnitudes. The
           slow uptick in the US as evidenced by a drop in jobless claims and this has given  
           confidence to the IT companies to go ahead on a hiring spree.

       

   7.    DOT slaps penalty on Airtel and Tata Communications. 

DOT has slapped a hefty fine of Rs.50 Crores on Airtel and Tata Communications for allegedly violating international long distance telephony licence conditions.

This notice was issued on Friday and the operators are given 15 days to pay up.

Events

a)    In 2007, both the above operators entered into separate agreements with SingTel (Singapore based Telecom Company) for offering long distance communication services.

b)    International long distance operators are allowed to sell leased line to other companies, in this case SingTel used the leased lines from Airtel and Tata Communications to further resell bandwidth to its enterprise customers in India.

            c) Now DOT alleges that SingTel billed and collected revenues from India without  
                licence. DOT has imposed the fine on the two operators for failing to detect the
                misuse by SingTel.

8.       Brazil Telecom Investments To Reach New Heights

   

              New investments in Brazilian telecommunications industries are set to reach 70 billion Brazilian Real ($41.42 billion) over the next five years on growth in the mobile phone, cable and digital TV sectors, and because of planned infrastructure work for Brazil's hosting of major sporting events.

9.   Iphone To Be Launched In HK, South Korea By Nov ‘11 End

Apple said that it will be launching iphone in Hongkong and South Korea by the end of November ’11, thereby giving them an opportunity to preorder the device. Apple will be coming up with the latest version of iphone. It will definitely add to the sales of iphone after its success in other developing and developed countries.

10.   OnMobile Q2 net doubles on non-operating income

OnMobile Global Ltd. said its second-quarter net profit more than doubled, helped by a boost in other income even as costs rose faster than revenue and tax expenses surged. The Bangalore-based company, which provides value-added services such as caller tunes and music downloads to mobile phone companies, said net profit is increasing as we are walking towards more application based service.

11.   China Mobile lures 5 million new iPhone users with Wi-Fi, rebates

China Mobile has yet to convince Apple to partner on an iPhone that supports its proprietary TD-SCDMA 3G network, but that hasn’t stopped the carrier from attracting customers to the device. In fact, China Mobile added 5 million new iPhone users in just four months, and it now serves a total of 9.5 million iPhone users, Bloomberg said. Each of those customers can use text, voice and 2G data, and all of the iPhone models it sells are unsubsidized. That may sound like a turnoff, but China Mobile has increased its iPhone user base by building out a nationwide Wi-Fi network to make up for its 3G shortcomings, and the carrier is also offering rebates worth as much as $440. The carrier plans to add an additional 1 million hotspots throughout China during the next three years, too. China Unicom has been an exclusive iPhone partner in China since 2005 and while it has less 3G subscribers than China Mobile, it is able to offer a 3G-capable iPhone because it operates a WCDMA 3G network.

12.         Apple positioned for smartphone fightback

Apple is well placed to retake the crown of top global smartphone vendor in the fourth quarter due to extending its range into lower price points, a Juniper Research analyst predicts. The data firm notes that South Korean vendor Samsung topped the pile during the third quarter, shipping 22% of 115 million global smartphones sold compared to 15% for Apple. Junipers points out that Samsung benefitted from continued strong sales of its flagship Galaxy S II model, and believes its future portfolio will shake up the smartphone market with new designs and form factors. However, research analyst Daniel Ashdown tips Apple to recover in the fourth quarter as sales of its iPhone 4S accelerate. “While the 4S is essentially an iPhone 4 with hardware upgrades, Siri is going to be a killer app for Apple,” he states, adding that Apple’s decision to push previous iPhone models down the value chain “positions the company’s handsets at a range of price points, without losing their premium image.”

13.   Returned Android phones costing operators $2bn a year

Customers returning malfunctioning Android phones for repair or replacement are costing operators as much as $2 billion per year, claimed mobile device management firm WDS. By analysing 600,000 technical support calls it handled over the last 12 months, WDS found that 14% of calls concerning Android-powered devices related to various faults in the device has started to hurt operators.

14.   Ambani brothers in telecom talks

India's Ambani brothers--once caught in a bitter feud over their massive family empire--may now be ready to work together again, with Mukesh's Reliance Industries Ltd. in talks to lease telecom infrastructure from Anil's Reliance Communications Ltd. for its new wireless broadband business.

15.   DoCoMo targets 30m LTE subs by 2015

                Japan's NTT DoCoMo has laid out is expansion plans for the next few years, including reaching 30 million LTE subscribers by 2015.  The company's medium-term plan, released today, also details ambitions to nearly quadruple its total smartphone customer base to 40 million by fiscal 2015. This compares to an estimated 1.3 million subscribers to its Xi LTE network - and 10.2 million total smartphone customers - for FY11. DoCoMo to increase total packet revenues by 1.5 times over the period, but this is dwarfed by an expected 12-fold increase in wireless traffic growth. To accommodate for the deluge, the company aims to increase its use of femtocells and Wi-Fi, and more than triple the amount of hotspots for the Mzone public wireless LAN service. DoCoMo hopes to achieve around 60% population coverage for the Xi network in FY12, 80% in FY13 and 98% in FY14

16.   ZTE tops global CDMA base station market

ZTE Corporation,  a publicly-listed global provider of telecommunications equipment and network solutions, said that it has become the global leader in the CDMA base station market, with a 32.6 per cent share in first half 2011. The CDMA market global has grown in recent years, especially in Asia Pacific, where it has expanded rapidly. This, coupled with a loss in market share by several established North American CDMA suppliers, prompted ZTE to seek new opportunities in CDMA markets across the globe. Through these efforts, the company has acquired leading market share in several emerging nations such as, China, Indonesia and India. It also has achieved significant breakthroughs in North America.

17.   DragonWave to acquire Nokia Siemens' microwave transport business

   Telecommunications equipment vendor Nokia Siemens Networks said that
   Canada's DragonWave Inc. is buying its microwave data transmission business for
   EUR10 million in cash and EUR5 million in shares. DragonWave, a wireless
   equipment maker, would also become a preferred supplier and will jointly develop
   future technology with NSN, it said.

18.   France Telecom buys 34% stake in Skyrock's Web ops

Orange, a unit of French telecommunications giant France Telecom, said it has acquired a 34.15% stake in Cascadia, a company that holds the web operations of French radio station Skyrock, for EUR14 million. This acquisition is another illustration of the role Orange intends to play on the web.

19.    Apple loses to Spanish minnow; Samsung takes smartphone lead

Apple had its wings clipped in one of a series of patent lawsuits this week, with a small Spanish computer manufacturer overturning a ban on its Android tablet PCs, and Samsung shipping more smartphones than the US vendor in the third quarter. In what is being billed as a David versus Goliath battle, Spanish computer maker Nuevas Tecnologías y Energías Catalá (nt-k) won court backing to re-start sales of an Android-based tablet PC in the country, over a year after Apple successfully had shipments stopped. The Spanish firm is incensed Apple also pursued a criminal case against it, and says it will now seek compensation for lost earnings and damage to its reputation. More worrying for Apple is that the Spanish court’s decision casts doubt on its main argument in a similar patent battle with Samsung that has already resulted in the South Korean firm’s Galaxy Tab 10.1 being banned in Germany. Despite the pressure on its tablets, Samsung topped the 3Q smartphone shipments chart with 27.8 million units sent out the door compared to 17.1 million for Apple, and Nokia’s 16.4 million.

20.    Alca-Lu slashes costs, trims guidance

Alcatel-Lucent chief Ben Verwaayen promises radical action to cut costs by €500 million ($689 million), as he lowered fourth quarter predictions on the back of what he called an unsatisfactory 3Q11. The equipment vendor’s earnings are heading in the right direction - net profit hit €194 million in 3Q11 compared to €25 million in 3Q10 - however revenue fell 6.8% year-on-year to €3.7 billion as sales in North America, Asia Pacific and Europe faded, and the cost of sales hit €2.4 billion.

21.    Barnes & Noble unveils Nook Tablet

Barnes & Noble Inc. unveiled the Nook Tablet, a device the bookseller will begin to sell in its stores next week as it targets core readers and takes aim at other hot tablets on the market. With the launch of the Nook Tablet, Barnes & Noble is aiming to court customers during the key holiday season, competing in a space that includes Amazon.com Inc.'s recently announced Kindle Fire and Apple Inc.'s iPad. Barnes & Noble's Nook Tablet will retail at $249, with other features including a free cloud service, nine hours of video battery life and access to the Nook newsstand and comics. Amazon's WiFi-enabled Kindle Fire retails for $199, while iPads have a starting price of $499. Weighing less than a pound, the Nook Tablet is physically similar to the company's Nook Color, and includes 16GB of storage and the capability to expand memory using a microSD card. It offers up to 11.5 hours of reading, uses the Android operating system, has Wi-Fi capability and a built-in microphone to read and record stories. Pre-loaded apps include Netflix, Hulu Plus, Pandora and Sudoku.

RURAL TELECOM (INDIA) - mHEALTH AND mEDUCATION

Out of the eight Millennium Development Goals, adopted by 189 nations, four are focused towards Health and Education. This reinforces the fact that health and education are the driving force in development of any nation and if issues in these areas are not addressed, they become hindrance in the economic development. India can be broadly divided into two segments, developing and underdeveloped. As per the census of 2011, 72.2 percent of Indian population resides in rural areas forming a large chunk of underdeveloped India. For transforming the rural India, technology needs to be in the driver seat. Telecom helps to reach in every corner of a nation and goes hand in hand with technology. Telecom’s answer to the burning issues of health and education is mHealth and mEducation respectively.

MHealth is the application of emerging mobile communications and network technologies for health care system. It involves the use of mobile computing, medical sensors and communication technologies for health care. A large segment of the patient population can be treated in their homes and communities, with access to expert care, through mobile technology. As patients consume more resources when they are in hospitals, this will have a significant impact on health economics. In India 33 percent of people living in villages have mobile phones. Hence this becomes a highly untapped segment for the Indian telcos.

Airtel has recently released its mHealth services, which is a SMS based health alert. These alerts are provided by mDhil Health Info Services Pvt Ltd, a Bangalore based start-up that provides healthcare information to the general Indian public mainly through text messaging, but increasingly through mobile web and digital content. Airtel offers 14 different SMS health packs such as Women’s health, Men’s health, Cardiac care, Diabetes etc. Irony is that mEntertainment and mFinance create stand alone products supported by lots of advertising dollars whereas mHealth remains more of a value added service.

Vodafone along with UN Foundation, the Rockefeller Foundation, cofounded mHealth alliance in 2009 to harness the power of wireless technologies to improve health outcomes in low and middle income countries. Soon after its launch, the mHealth Alliance welcomed GSMA and the U.S. Presidents Emergency Plan for AIDS Relief (PEPFAR) as Founding Partners. In 2009 Vodafone created the Vodafone Health Solutions business unit, which is located within its Global Enterprise division. The unit is tasked with developing a global portfolio of health-related services. So it was not a surprise for many when Vodafone sold its 5.5% of Indian operation to Indian medical services provider Piramal Healthcare in August 2011. Telecom operator Aircel has tied up with the Apollo Hospital Group to launch a medical consultation on the mobile. The service is called Aircel Apollo Mobile HealthCare. A tie-up between the two companies is not surprising, particularly since the Reddy family of the Apollo Hospitals group owns around 26% stake in the telecom operator.

On the similar lines, Tata Docomo launched Sparsh – a value added service on sexual & reproductive health related issues for its GSM Mobile service subscribers in India. The content of the service is extensively accurate and certified by FPAI (Family Planning Association of India), one of India’s largest sexual and reproductive Health NGO. Tata Indicom  launched “Doctor on Call” service in partnership with Healthcare Magic, an Accel Partners funded Tata Indicom, to offer consultation services for Acute and chronic emergency situations. HealthcareMagic connects medical professionals with those seeking consultation: callers are offered consultation with doctors via phone, and the Internet. On the phone, a doctor registers the personal data and medical history of the subscriber, diagnoses the cases, based on whether the issue is acute, chronic and emergency

For the Education sector, mobile connectivity provides an opportunity to offer new ways of teaching and learning that ultimately will improve performance and results whilst at the same time open up new markets for mobile operators across the world. Mobile will increase access to up-to-date materials, will enable collaboration and strengthen learner engagement. All these objectives can be achieved via mEducation. Tata Indicom in 2008 partnered with SNDT Women’s University, Atom Tech (Any Transaction on Mobile), Mumbai, & Indian PCO Teleservices Ltd to develop and disseminate mobile education, an additional vehicle in distance learning, to reach the masses for remote teaching and learning in rural communities and physically challenged. Under this model, the mobile phone undergoes a metamorphosis—from a device that allows you access to voice and text messaging, it transforms into one that helps you access accredited educational content, take mock tests on the move, regardless of geographies or physical constraints.

A new VAS called ‘Tutor On Mobile’ (TOM) was launched by VOICETAP and Tata DOCOMO in July 2011. This VAS was designed to help students to access education information when they are on move. ‘Tutoron Mobile’ (TOM) is loaded with premium educational content and easy learning mechanism. With the help of Knowledge conference call and monetizing their expertise’s experts can provide answers worldwide. The content provided by ‘Tutor on Mobile’ (TOM) are in the form of video, text, images, live interaction, podcast etc.

Nokia and Bharti Airtel joined hands to launch Ovi Life Tools service targeted at providing Airtel's mobile customers with access to relevant content on education. This partnership between India’s largest maker of mobile devices and largest telecom operator represents a wide scale distribution model that will empower Indian masses with improved access to information available in a simple icon based, graphically rich user interface. This initiative includes focused offerings on Learn English, General Knowledge & Exam preparation modules covering State and Central Boards.

As developing nations recognize the potential impact mHealth and mEducation can have on its country’s health care and education system, we will witness a surge in the mHealth and mEducation movement as governments invest significant resources to build and to expand offerings for its citizens. Developing nations don’t have the infrastructure for standard telecommunications, but mobile communication is readily available. Hence, it naturally makes sense to leverage wireless networks to deliver health care in these rural areas. A number of organizations are looking at ways to expand their mHealth offerings in places like India, Africa, and China. In particular, we’re seeing modified versions of telemedicine emerging as cost-effective alternatives to direct patient interaction. Also, with the increasing penetration of smartphones it is believed that the growth of mHealth and mEducation will gain momentum.

Written by : Rahul Singh

                  MBA TM ( I )

                      SITM

DRAFT NATIONAL TELECOM POLICY – 2011

Draft aims to achieve 175/600 million broadband subscribers by 2017/2020

The draft National Telecom Policy announced is a ten year roadmap. The government intends to make this policy effective from December 2011.

CONSUMERS

      

   Ø  Broadband speeds of at least 512Kbps and 2Mbps by 2015. 256 Kbps will be  
        history.

   Ø  MNP now in inter circles.

·         For example a user currently in Airtel’s Delhi circle can shift to Mumbai’s Vodafone circle and retain the original number.

   Ø  No roaming charges. So free incoming even while roaming.

·         Operators may look to change this as around 10% of revenues are earned through roaming charges.

·         May increase the local charges.

·         The operators can also gain now through increased usage.

   Ø  Net Telephony to be opened up à cheaper calls over internet.

    

     OPERATORS

     

          Ø  Infrastructure status to Telecom.

·         Tax benefits

    Ø  Taxes and levies to be streamlined.

·         Aid in network expansion à improved connectivity affordable telecom services

    Ø  Exit policy for those who want to surrender licence.

    Ø  Spectrum pooling, trading and sharing to be allowed.

·         Revenue options

·         Increased spectrum utilization

    Ø  Telecom Finance corporation to mobilize funding.

     

     SPECTRUM

    Ø  Additional 300 MHz spectrum by 2017 and 200 MHz by 2020.

·         Greater supply of spectrum à rational/reduced spectrum prices due to demand-supply forces.

       ØFuture allocations based on market-linked pricing.

     MANUFACTURES

    Ø  Promotion of indigenous R&D, IPR creation.

    Ø  80% of procurement by telecom companies by domestic manufactures by 2020.

       Ø Small chunks of spectrum for locally developed technology.

LICENCING & REGULATORY

    Ø  Single unified licence across services and service areas.

    Ø  Separate licences for services and network infrastructure.

    Ø  Spectrum to be delinked from licence.

    Ø  More powers to TRAI and WPC.

    Ø  Convergence bill to be revived in a new format.

·         Optimize transmission of services to consumers irrespective of their devices or locations by Fixed-Mobile Convergence thus making available valuable spectrum for other wireless services.

·         Convergence of services will cover voice, data, video, Internet, VAS

    Ø  Spectrum regulation act.

    Ø  The technology neutral Unified Licenses are envisaged to be in two separate        
           categories.

·         Network Service Operator (NSO)/ Communication Network Service Operator (CNSO)

              ·    Service Delivery Operator (SDO)/ Communication Service Delivery Operator (CSDO)

BROADBAND POLICY

    Ø  “Broadband on Demand” by 2015.

    Ø  175 million broadband connections by 2017 and 600 million by 2020.

    Ø  Connect all villages by optical fibre cable by 2014.

·         Telecom Commission has already earmarked Rs 20,000 Crores for this proposal à National Fibre Optical Network (NFON)

       

Ø

 Increase rural tele density from 35 to 60 by 2017 & 100 by 2020.

àNo details on when and how the proposals will be implemented.

CHRONOLOGY OF TELECOM POLICY MAKING
NTP 1994	OBJECTIVE: Aimed at opening up telecom services segment for private players. Tele-Density was just 0.8% and hence it sought to provide telephone on demand by 1997.	RESULTS: Faulty bidding processes for licences strangled progress. Target of covering all villages by 1997 is still unmet.
NTP 1999	OBJECTIVE: Aimed at making telecom sector more investment friendly. Offered a migration path to operators from fixed licence fee to revenue share	RESULTS: Huge success as it laid down the foundation for explosive growth in the mobile sector. Overall tele density moved to 74.5. Lack of clarity on spectrum allocation led chaotic decision making. Broadband and rural telephony yet to pick up.
NTP 2011	AIM: Build upon NTP 1999 to address issues linked to emergence of new technologies, broadband penetration and spectrum management.	RESULTS:

L.KISHAN CHAND
Class of 2013

Mobile Number Portability and its after effects

“MNP has been implemented – now its time for a reality check for all CSPs. Good boys will be rewarded and bad boys will be punished. And, for a change, the verdict would come from none other than the king (the subscriber!) himself.”

 “Mobile Number Portability” means the facility which allows a subscriber to retain his mobile telephone number when he moves from one Service Provider to another irrespective of the mobile technology or from one cellular mobile technology to another of the same service Provider. Hence one can port a CDMA number to GSM and vice-versa.  
The world’s first country to adopt MNP was Singapore in 1997, followed by UK ,Hongkong and Netherlands in 1999. The MNP service was launched across India by Jan 20, 2011 as per the timeline decided by DoT.

In India, it is currently available for intra-circle only. However due to the configuration of each Telecom circle porting can also happen between Madhya Pradesh & Chhattisgarh; Bihar & Jharkhand; Rest of West Bengal & Andaman and Nicobar; within the states of the North East excluding Assam.

The major changes that MNP brought in the telecom domain for the CSPs as well as the subscribers are discussed in the following paragraphs. Firstly, MNP has created a level-playing field for the CSPs and a competitive environment. With the introduction of MNP, customers are empowered to change their operator at the smallest problem they encounter with the services provided. This has led to an increase in the Quality of Service offered by the CSPs. Apart from the QoS, the CSPs have also started to concentrate on improving other services like Customer care,Tariff plans and so on.

MNP has had a few significant implications, both for the subscribers and the Cellular Service Providers(CSPs), but still it has not acted as a game-changer. It has been noticed that the first consumers to switch their mobile operators were the unsatisfied post-paid customers. Post-paid customers are only 4% against a 96% of the pre-paid segment- where number retention is not a priority.Pre-Paid customers usually buy a new connection from a different CSP, if they are not satisfied with their current provider, instead of going through the rigorous procedure of MNP. Even if the Pre-paid customers port-out from an operator they have very low ARPUs and the cost of servicing each customer is quite high, in terms of the revenue losses. Hence, operators expect MNP impact not be quite huge.Also, post-paid customers are those who do not want to change their phone numbers very frequently due to minor reasons. Therefore, if given a chance to walk out on an operator, while still keeping the previous mobile number, post-paid customers would be more than happy to port-in to a better service provider and hence contributing to a major part of the churn caused by MNP.

In India, pre-paid customers outnumber the post-paid customers. Also, a major chunk of the pre-paid customers have multiple SIM cards of different operators. Brand loyalty,thus, is not the reason why customers stay with a particular operator. It is the optimum Quality of Service that a customer desires from a CSP.

Industry sources say, on an average around 200,000 porting requests were received from across the country. "As of now porting request numbers are insignificant in the overall scheme of things," said an industry source. India has around 860 million wireless subscribers, according to the latest numbers by Telecom Regulatory Authority of India (TRAI).This data signifies that MNP has not been able to cause a major churn for the operators.

The rules of MNP say a network cannot refuse a customer coming into the network, and hence cannot control the quality of subscribers that could enter their networks. Experts say the direction of migration could be towards incumbents. Operational costs will go up as a large number of subscribers add into the network. Analysts say this would put pressure on the network causing congestion, and reducing service quality to the high ARPU customers, who are present in larger numbers in incumbent operators' networks.

An IBN survey finding provides that Airtel was the most preferred operator with 26% respondents voting in its favor, followed closely by Vodafone (21%) and Idea (13%). Idea came at a distant 3rd position despite having launched a big advertising campaign – “No Idea? Get Idea”

An important aspect that has been ignored in enforcement of MNP is that consumers are no more able to distinguish between different networks when placing a call. Due to this, the tariff transparency has been lost. That is , if there are different rates applicable for calling to a different network , a subscriber might end up being unaware of the charges that he is paying for a particular call.

One more fact which deters users to go for MNP is the inconvenience caused during the whole process , when the subscriber has to apply for porting out of an operator and moving on to a new one. Also, quite a few documents need to be submitted along with a few more formalities and a fee of Rs. 19. A normal pre-paid customer would find it easier to buy a new SIM instead of porting his existing number to a different operator.

Even after being aware of the fact that MNP is not going to cause a major churn for the telcos, Mobile phone companies are under constant pressure to improve their services so that their subscribers not only stay with them but they are also able to attract subscribers from other networks. Better services mean the companies are setting up more mobile phone towers, upgrading their equipment and providing instant rectification of problems so that the subscribers are always able to get connected, surf the Internet and make full use of their mobile telephones.

Written by :    Ankita Agarwal

                        MBA TM (I)

                            SITM

Is India Ready for 4G?

In the highly competitive Indian telecom market the survival of service providers depends on their ability to come up with innovative and good quality services at regular time intervals. Today the customer wants more customized services at a faster rate, with low latency and at a much cheaper rate. Telecom companies are continuously upgrading themselves with the latest technologies in order to match the ever changing expectations of the consumers. From 1G to 2G, 2G to 2.5G, 2.5G to 2.75 and now from 2.75 G to 3G several changes have been made in the network architecture and air interface technologies.

But in a nutshell the biggest question is whether the telecom companies are getting sufficient rewards for their actions. On the recently held 3G auction telcos spent almost 67,000 Cr to acquire 3G licenses which act as chokers to their balance sheet. It is expected that it will take at least 4-5 years to start making profits out of 3G. Even after almost one year of allocation of 3G spectrum the subscriber base count has just reached 11 million and the overall situation is looking very scary from the service provider’s point of view.

Allocating the BWA spectrum along with the 3G spectrum has lead to another debate in the market i.e. whether 4G will also be deployed soon and, if it happens then how will the operator recover their money out of the 3G, since consumers would prefer to switch directly to 4G from 2G. BWA spectrum has already cost around $5.5 billion to the telecom players and it is expected that telecom operators will need to invest $1 billion further in order to deploy the 4G infrastructure. So how will the operators survive in the future?

Some Analysts believe that 3G and 4G can go hand in hand as 3G is primarily for the voice services whereas 4G will be used for data services. Once 4G will be deployed then it may help the service providers to increase their declining ARPU’s with the help of data services.

There are many other factors too that are driving the operators for adoption of 4G technology such as-

         1.    Need for Converged Networks and Converged Services

         2.  Software Independency

         3.  Low latency Services

         4.  More Customized applications & Application Ecosystem

         5.  Interoperability of Network elements

Analysts believe that these factors will lead to Capex reduction (infrastructure sharing , leasing etc) and will optimize network operation cost with better utilization of spectrum and increased monetization of end to end service and with the help of these two factors operators will get healthy return on their investment.

So Even if operators show readiness in adoption of 4G services, question lies whether the entire Telecom Ecosystem is ready for that?

Early adoption of 4G will lead to several risk factors that may hamper the success of 4G in Indian context. Some key factors are:

1. Availability of Infrastructure – Most of the operators are still doubtful whether they should go for Wimax or LTE. If operators go for LTE, as is expected, then there could be a possibility of demand supply mismatch since the Equipment Manufacturers are not yet ready with the desired infrastructure requirements.
2. Availability of 4G Devices/Handset – It took almost one year for the market to mature in terms of 3G handsets. It is highly expected that the same will happen in case of 4G. Thus in semi urban and rural areas high price of 4G devices in the initial stages could hinge the success of 4G technology.
3. Content Availability – Success of 4G will depend upon the data services and availability of high quality content. Therefore it is highly required for the content providers, content aggregator and technology enabler to start work in advance to leverage the full opportunities that will open up due to 4G. As the present content is not sufficient to fulfill the demands of bandwidth hungry 4G applications.

Thus it can be said that the success of 4G is not just dependent on service providers but also on the entire ecosystem that includes customers, infrastructure manufacturers, device manufacturers, content providers etc and until all of them are not ready there is no point in offering 4G services. The Success of 4G will depend upon how ecosystem challenges and faces the problem in front of them. An effective strategy backed with sufficient planning and proper implementation would lead to effective deployment of 4G technology.

Written by : PIYUSH GUPTA

                     MBA - TM (II)

                               SITM