Carriers Slam Ofcom’s Mobile Price Cuts
Cbronline writes…Two of the UK’s largest fixed-line carriers have slammed new controls governing the cost of making a fixed-line call to a mobile phone, after the UK regulator Ofcom instructed mobile operators to cut connection fees.
The current controls governing the cost of making a fixed-line call to a mobile phone were set to expire at the end of this month. Following a two-year review, Ofcom on Tuesday set new charge controls that limit the amount mobile operators are able to charge other telephone companies for connecting calls to their networks.
Ofcom said that it expects this to result in significant savings for consumers over the four-year period that the controls will apply. It expects an average annual reduction in wholesale charges of 400m pounds ($786m) to 500m pounds ($983m) over four years; savings which Ofcom “expects to be passed through to retail customers.”
The new mobile voice call termination charge controls will now apply equally to 2G as well as 3G mobile operators in the UK, meaning that Hutchison 3G (3) will join Vodafone, Orange, T-Mobile and O2 in being subject to the new rates.
Ofcom decided to reduce the level of average wholesale charges across the board. Lowly fifth-placed operator 3 is subject to charge controls of 5.9 pence ($11.60) per minute (ppm), a reduction of around 45% from current charges.
Meanwhile, the average wholesale charges of the big four (Vodafone, O2, Orange and T-Mobile) will be reduced to 5.1 ppm ($10.02) in current prices. Ofcom said that for Orange and T-Mobile, this represents a reduction of around 20%; and for Vodafone and O2 a reduction of around 10%.
However, in a rare case of mutual agreement, two of the UK’s largest fixed-line carriers have slammed the new rates.
“Ofcom’s rates are overly generous to the mobile operators,” said Jim Marsh, CEO of Cable & Wireless Plc in a statement. “Fixed network customers will bear the brunt by paying above the odds for calling mobile users — money which the mobile operators will use to subsidise the retail tariffs they offer to their own customers.”
“To be clear, we’re talking around 1.5bn pounds ($2.95bn) over the next four years… that’s not small beer,” he added. C&W said it was working through the detail of Ofcom’s reasoning before deciding what action to take.
AT&T Launching Huge Pay-by-Mobile Program
Your phone is now a bank—or at least a debit card.
The Western Hemisphere sometimes comes late to the high-tech party. Such is the case with mobile banking, an established practice in Europe and Japan. Heck, you can pay by text in Belgium.
But fear not, American mobile phone users. Cingular is on the case. That would be AT&T, actually, for those keeping track of all the mergers and buyouts all across the land. AT&T has linked up with Wachovia, Regions Financial, BancorpSouth, SunTrust, and a host of other U.S. banks in what looks to be a giant program allowing mobile phone customers to use their phones instead of credit or debit cards. (If you think this sounds like something that Helio has already done, you’re right.
Cingular (which it was back then) has already done this, too, in a deal with Nokia in New York with Citi MasterCard. That was a preliminary exercise. This latest deal will expand on that experience considerably.
AT&T aims to continue to sign up banks and continue to improve on its existing software, which will soon be available for download for existing phones and which will be included on future phones.
For Best Practices/ Case Studies on Mobile Money – Banking, Remittances, Commerce & Payments. Please contact Christina@WirelessFederation.com
Bharti overtakes Hutch in ARPU
MobilePundit writes…India’s largest mobile operator, Bharti Airtel has overtaken Hutchison Essar with regard to its average revenue per user (ARPU).
As per the latest data by the Cellular Operators Association of India, Bharti had an ARPU of Rs 343.17 per month for the quarter ended December 2006, ahead of Hutchison Essar’s Rs 340.15 per month. Hutch’s ARPU fell by over 9% in the quarter ended December 2006, while Bharti witnessed only a 1.5% fall in its average revenues during the same period.
The average industry ARPU has fallen to Rs 316 for the quarter ended December 2006 from Rs 356 in March 2006 – a fall of Rs 40 per subscriber and a decline of 11%. On the other hand, private operators have recorded a 10% increase in the revenues during the quarter ended December 2006.
Idea, Reliance Telecom and Aircel also saw a dip in their ARPUs compared to the Sep ‘06 quarter.
Idea Cellular = Rs 276.66, a fall of 12.80%
Reliance Telecom = Rs 187.09, a fall of 25.48%
Aircel = Rs 226.91, a fall of 15.73%
BPL Mumbai and Spice Telecom are the only two operators to have registered an increase in their ARPUs during this period. BPL’s average revenues grew 27.40% to touch Rs 386.28, while Spice witnessed a 5.5% increase at Rs 241.79% for the quarter ended December 06.
Indosat reports 13% fall in 2006 net profit
Telegeography writes…PT Indosat, the second largest telecoms operator by subscribers in Indonesia, has reported a higher-than-expected 13% fall in net profits in 2006, as the group’s mobile arm Satelindo failed to keep pace in a buoyant telecoms sector. Local industry watchers note that Indosat has been hit harder than its competitors by the effects of rising competition, experiencing higher churn rates than its rivals or seeing more users throwing away pre-paid cards when they run out, rather than recharging them the so-called ‘calling card phenomenon’.
Indosat has faced fierce competition both from the other mobile network operators and from no-frills WiLL operators such as Bakrie Telekom which are making inroads in the market. Satelindo’s mobile subscriber base grew by just 15% to 16.7 million users in 2006, compared with a mean growth of 40% for the industry overall. The impact of competition resulted in net profit falling to IDR1.41 trillion (USD154 million) last year from IDR1.62 trillion in 2005, although company officials are confident of posting strong growth in fiscal 2007 as the mobile market continues to expand. Wong Heang Tuck, finance director of Indosat, told reporters the company expected revenue to grow 20% in 2007, up from IDR12.24 trillion in 2006. Wong went on to say that Indosat might look to raise upwards of IDR500 billion from the market this year to fund its expansion plans. The company aims to add between five to six million new mobile phone users this year.
ArmenTel announces imminent launch of GPRS services
Telegeography writes…Armenian fixed and mobile operator ArmenTel, which is now owned by the Russian mobile communications firm Vimpelcom, says it has launched a pilot trial of GPRS services and now plans to introduce a commercial service within the next month.
Last week, CommsUpdate reported that the Armenian government had agreed to sell its 10% stake in national telecoms operator ArmenTel to Vimpelcom for EUR38 million (USD50.8 million). The deal will give the Russian operator full ownership of the Armenian PTO, following its acquisition of OTE of Greece’s 90% interest in November 2006 for EUR341.9 million, plus about EUR40 million of debt.
Omantel signs ADSL deal
Telegeography writes…Oman incumbent telco Omantel has inked a OMR7 million (USD18.3 million) contract with an unnamed Chinese vendor to provide between 100,000 and 180,000 asymmetric digital subscriber lines (ADSL), bringing broadband technology to various regions across the Sultanate.
Versatel plans IPO
Telegeography writes…German wireline operator Versatel is planning an initial public offering (IPO) on the Frankfurt Stock Exchange before the end of June 2007, writes Telecompaper. The firm is currently 100%-owned by private equity firm Apax Partners. CEO of Versatel Peer Knauer said that the flotation will provide the financial flexibility required to allow it continue to increase its presence in Germany’s broadband market. The firm intends to become the leading alternative broadband operator by expanding its ADSL2+ infrastructure to unserved regions. Versatel’s revenue for the financial year 2006 was EUR666.2 million (USD885.3 million) compared to EUR546.9 million in 2005, while EBITDA was EUR211.8 million last year, up 49% from 2005.
Batelco acquires 20% of SabaFon
Telegeography writes…Bahrain Telecommunication Co (Batelco) Chairman Sheikh Hamad bin Abdulla al-Khalifa has revealed that his company has purchased a 20% stake in Yemeni cellco SabaFon for USD144 million in cash. The shares were bought from SabaFon’s largest shareholder and chairman, Sheikh Hameed al-Ahmar. Despite the deal, al-Ahmar Group will remain SabaFon’s largest single shareholder.
SabaFon, which claimed a 1.2 million strong subscriber base at the end of February, is the largest GSM mobile operator in the country with a market share of approximately 40%. Batelco chief executive Peter Kaliaropoulos said that Batelco’s share in SabaFon would provide a significant entry into the rapidly growing market in Yemen, which has a population of more than 22 million and wireless penetration of approximately 12% as of January 2007.
China Telecom net profit rises 4.9%
Telegeography writes…China Telecom, the People’s Republic’s largest fixed line telco, has reported a 4.9% increase in net income in 2006 to CNY22.2 billion, while sales rose 4.7% to CNY170.1 billion. China Telecom reported that net income including connection fees of CNY4.97 billion fell 2.6% to CNY27.1 billion from CNY27.9 billion a year earlier. China Telecom added 12.95 million fixed-line users (including those to its limited mobility ‘Little Smart’ service), during 2006, to take its total to 223.04 million, though additions were down from the 23.4 million added in 2005. China Telecom gained 7.3 million broadband users in 2006 to take its total to 28.3 million: the company added another 1.47 million broadband users in the first two months this year.
