Deutsche Telekom, France Telecom and Telecom Italia to Audit Asian Suppliers
Deutsche Telekom, France Telecom and Telecom Italia have announced that they are together conducting on site audits in Asia aimed at strengthening their commitment to developing a strategy of responsible and sustainable growth all along the Supply Chain of 40 suppliers based in Asia. This audit campaign follows the signature of a Memorandum of Understanding (MoU) in December 2009.
Through this MOU the three operators have defined a synchronized audit process based on a common evaluation methodology to verify and improve the social, ethical and environmental conditions of their suppliers’ manufacturing centres located in Asia. The audits are implemented by recognized international CSR audit companies that will release official and recognized audit reports. These will then be followed up by each of the operators. Other telecom operators are also welcome to be part of this Joint Audit Cooperation by signing the MoU.
The MoU will open potentials for partnership in the processes used to assess suppliers. These processes will be developed together and in cooperation with suppliers. The suppliers will then be assessed according to a defined set of parameters in favor of respecting people and the environment, mainly in line with SA 8000 and ISO 14001 standards.
According to Marc Fossier, France Telecom Social Responsibility Executive Director, this MoU will seek to enable the achievement of CSR goals on an international level and will allow the three operators to optimize their CSR assessment and follow up process through the application of common best practice. It will also enable operators and suppliers to save precious time and effort by joining forces. The company is delighted to be part of this joint venture between important Telcos. It will promote the ambition to enhance sustainable development as well as human rights principles among our suppliers.
India, Russia may team-up to produce telecom hardware
According to Telecom and IT Minister A Raja, India and Russia could set up a joint venture for producing telecom hardware to meet the growing domestic demand even as government readies to roll out 3G and WiMax broadband in the country.
Raja told reporters that Russia is among the four countries, including the US, Taiwan and Korea, which have the capacity of making silicon chips for 3G and WiMax. The idea of an Indo-Russian JV in India came up after Raja visited the Micron Company, which produces silicon chips.
According to Raja, it is an integrated company with full cycle of production from silicon wafers to micro chips. India will welcome technical and financial contribution from Russia in the JV.
Russia is among the first few countries to implement commercial cellular networks of WiMax. At present they function in Moscow, Saint Petersburg, Sochi and some other cities.
Raja is the first Indian Telecom and IT Minister to visit Russia after the former IT Minister Pramod Mahajan’s Moscow visit in September 2001. The government then had promised to invest heavily in the Russian IT sector, famous for its Hi-End software.
Raja also visited the hi-tech Emergency Response Centre of the disaster management authority of the country in Moscow, which continuously receives online data from all over the country and automatically disseminates it among the concerned bodies.
Raja had discussed with his Russian counterpart Igor Shchegolev in Moscow to explore the possibilities for interaction in IT and telecom.
According to Raja, they believe that joint work will bring information and communication technology to the masses. The two sides have agreed to sign a MoU to this effect.
The Russian IT and Mass Media Minister Shchegolev told Raja that they believe, this technology is ready for export.
The two ministers expressed satisfaction at the ongoing bilateral cooperation in the space-based navigation system GLONASS and productive activities of Russian-Indian venture Sistema Shyam Teleservices Ltd (SSTL), marketing cellular services in India under MTS brand.
ArmenTel Q2 Revenue down by 6.5%; growth in MoU
ArmenTel, the largest telecom company in Armenia’s net operating revenues fall by 6.5% year-on-year to US$46.5 million for the quarter ending 30 June 2010. The plunge in net revenue caused an adverse affect on the mobile arm which booked an 8.3% decline in YoY revenues.
At the end of June 2010 ArmenTel added up 49,700 broadband internet subscribers, an increase by 158.9% year-on-year, at the same time the mobile base expanded 16.7% to 567,000. Additionally, 13.3% increase was seen in monthly MoU to 270.1 minutes.
According to the company, the turnover for the cellular division slumped to US$ 0.02 million while sales derived from fixed line operations came to US$0.03 million.
Airtel-Zain Rumbles in Kenya market: Slashes Tariff Rates by 50%
Bharti Airtel has announced its first aggressive pricing to the consumers in Kenya market, a first of its kind move by Bharti since its acquisition of Zain Group’s mobile operations in 15 countries across Africa. The deep cut in tariffs can have significant impact on customer acquisition and market share cannibalization in the highly competitive Kenyan market.
Kenya’s 20 million mobile phone market is the second largest operation of Zain acquired by Bharti Airtel. The low margin volume game that Airtel pioneered in India will help mobile telephony to reach the unexplored segments which still has significant potential as the mobile penetration in the market is still less than 50 percent.
KENYA MOBILE MARKET OVERVIEW:
-Four mobile players in the market i.e. Safaricom, Zain, Orange (Telekom Kenya), Yu (Essar).
-Safaricom has built a very strong proposition in the market with >70% market share and has managed to grow the market share gap with the competitors in past few years
-The slash in new tariff structure will help Bharti Airtel put significant pressure on the market leader Safaricom to protect their market share. The new Tariff structure will help Zain-Airtel penetrate lower income tiers.
-Safaricom will have to come up with a robust strategy to protect their market share as well as growth. It’s mobile money service M-PESA has been a tremendous success in the market with huge unbanked population with over 2 million users.
-Airtel-Zain holds <20% market share and has witnessed continuous loss of market share to Safaricom in recent times.
-Orange is the Third operator in the market, entered in 2008 when France Telecom brought Telkom, the incumbent. Orange can bring some aggressive pricing structure as well as innovative products to the market.
-YU (Essar) is the fourth mobile operator in the Kenya, launched in 2008 despite receiving license in 2004. Mainly targets 18-35 years audience with affordable pricing. YU will be under tremendous pressure with the new tariffs launched by Airtel as they have stated to be ‘the cheapest forever’.
Average minutes of usage (MOU) per subscriber for Airtel-Zain’s African Operations are still as less as one-third of Indian MOUs, and there is, therefore, the potential for exploring usage elasticity and replicating the minute factory model.
The Tariff slash move by Bharti- Airtel might be seen as a start to implement its successful ‘MINUTE FACTORY MODEL’ in the acquired African operations. The low price high volume model is ‘Minute led’ model compared to ‘Subscriber led’ models that were traditionally used in mobile industry.
‘Minute Factory Model’ is based on product/factory perspective considering ‘Minutes’ as a final product produced through a complex chain of outsourced units i.e. customer support, IT, Infrastructure, Network. Zain-Airtel focuses on selling maximum ‘Minutes’ produced i.e. Maximizing per minute profitability and adding additional capabilities as the demand raises. The beauty of the Airtel’s Minutes Factory is that it can add small capacities fairly rapidly and economically. The key to this is an array of partnerships & relationship that manufacture†the minutes for Airtel removing the burden of fixed cost.
As the Tariffs in Africa are relatively still high, one can expect several similar moves by the telecom giant in the other market to stimulate demand by cutting cost.
China Mobile H1 revenue increased by 8%
China Mobile reportedly recorded a 4.2% year-on-year raise in first half net profit to US$ 8.488 billion, earnings per share reached US$ 0.4226.Operating revenues in the same period increased to 7.9% year-on- year to US$ 33.843 billion, of which revenue from value-added services accounted for 29.5 percent.
EBITDA rose 6.1% to US$ 17.170 billion, giving a margin of 50.7%. The company’s voice traffic rose 20 % from a year ago to 1.664 trillion minutes. In the first half of the year, the minutes of usage (MOU) and average revenue per user (ARPU) of China Mobile reached 520 minutes and US$ 10.602 per month.
The number of users of China Mobile’s voice services increased by 31.76 million in the first half of the year to total 554 million.
Data and value-added services also continued to grow. Data service revenues grew to US$ 4.491 billion from US$ 3.357 billion last year, while SMS revenue slowed to US$ 3.799 billion from US$ 3.755 billion.
According to China Mobile, its 3G network had reached 115,000 base stations and it expects to have 200,000 by year-end, covering 238 cities in China.
Pakistan mobile operators sign in MoU on infrastructure-sharing
The Pakistan Telecommunication Authority and mobile operators of Pakistan have inked memorandum of understanding( MoUs) on infrastructure sharing.
The agreement between the regulator and cellcos will be applicable for three years and may be extended with mutual approval of the parties, upon expiration of the initial term. The deal signed by five mobile operators cellcos Mobilink, Telenor Pakistan, Warid Telecom, Pakistan Telecommunications Mobile Ltd and CM Pak (Zong) ,that aims at bowing up the current speed of infrastructure sharing amongst mobile and WLL operators in the country and to increase the overall industry contract ratio to a reasonable mark.
Each operator, mutually with other industry players, will make commercial arrangements as part of efforts to take the overall industry’s tenancy ratio to a level of 1.5 within the next three years, with yearly benchmarks aimed at 1.1 and 1.3 for the first and second years respectively.
Megafon records 3.7% rise in revenues
www.WirelessFederation.com/news: An increase of 3.7 percent in the revenues has been announced by Russian mobile operator Megafon, earning RUB 181.9 billion for 2009. OIBDA went down to RUB 88.2 billion, decreasing 0.1 percent, and the OIBDA margin dropped to 48.5 percent from 50.5 percent in 2008.
2.2 percent increase in the net profit has also been reported generating RUB 45.3 billion. RUB 33.5 billion in free cash flow last year has been generated and with 4.7 percent increase, the CAPEX closed at RUB 52.5 billion. OIBDA dropped 2.0 percent over the same period to RUB 23.1 billion while the fourth-quarter revenues were up 1.9 percent from the third quarter of 2009 to RUB 48.4 billion and the OIBDA margin fell to 47.7 percent from 49.6.
The number of subscribers increased by 16.3 percent, year-on-year, to reach the total of 50.74 million at the end of 2009. The MOU of the company rose 3.6 percent to 285 while ARPU was down 3.1 percent from Q3 to RUB 316. For 2010, Megafon has declared that it will continue with the expansion of its retail network and 3G services.
CAT gets nod to purchase Hutchison-CAT’s cellular businesses.
The board of CAT Telecom has given the green light to sign a memorandum of understanding with Hutchison Telecom on CAT’s plan to buy four Thai cellular and related businesses from the Hong Kong telecom operator. Hutchison-CAT is a 75:25 joint venture of Hutchison Telecom and CAT.
The board has assigned CAT CEO, Jirayuth Rungsrithong to sign the MOU before the end of this week.
CAT will buy BFKT, a wholly owned subsidiary of Hutchison Telecom. CAT also plans to buy assets of Hutchison Telecom in the joint venture – its call centre and content businesses.
The CAT board also approved the plan to hire Allen & Overy for legal advisory services, Bualuang Securities for financial advisory services and Chulalongkorn University’s Chula Unisearch for HR advisory services.
CAT will transfer under itself a combined 1,000 employees of the four businesses it plans to buy.
Hutchison Telecom had invested about Bt30 billion in the CDMA business since Hutchison-CAT’s service debut in 2003.
Interestingly also, Krisda said CAT was concerned about a clause in the draft law governing the creation of the new broadcasting and telecom regulator in Thailand. The clause mandates that if CAT were to list shares in the stock exchange, it will have to either pay half of its revenue to the state or return to the state the spectrum it granted to private concessions.
