Pan- India 3G license bid touches Rs 16,828 crore
www.WirelessFederation.com/news: The bid for the pan- India 3G license auction reached Rs 16,828 crore, double the amount which has been expected by the government. In the auction that lasted for 34 days, Bharti, Idea and Vodafone Essar are said to win in some of the circles. The reserved price of the auction was Rs 3,500 crore and the expected to earn 70,000 crore.
Auction for Broadband Wireless Access (BWA) spectrum will commence by the government two days after the close of auction for 3G telephony spectrum.
Nine leading mobile operators, including Bharti Airtel, Vodafone, Reliance Communication and the Tata Teleservices, had entered the auction to grab spectrum for 3G services. The 3G services will allow users to access high-speed data downloads on mobile phones.
Only three operators in most state would have managed to get a slot while four were available in Punjab, Bihar, Orissa, Jammu and Kashmir and Himachal Pradesh.
Reliance Comm reaches 100m customer landmark (India)
www.WirelessFederation.com/news: A landmark of 100 million wireless customers has been crossed by India’s Reliance Communications (RCom). This has made it the 2nd largest wireless operator in the country, and the 4th in the world to achieve this milestone.
According to Anil Dhirubhai Ambani, Chairman, Reliance ADA Group, the landmark 100 million mobile customer base makes Reliance the youngest telecom operator to achieve this milestone in such a short span of time. Reliance Communications pioneered the mobile revolution in India and since then it has been the frontrunner of telecom innovations in the country. As the company takes the leap to achieve the 200 million mark, it will lead it from the front with more customer-centric innovations and service approach.
The aim of the company is to achieve 100 million customers within the next 1,000 days. The company is also contemplating to rollout CDMA mobile broadband network which will offer Internet speed of up to 3.1Mbps beyond 60 cities within the next 100 days. The planned roll out will take the total number of cities covered to 125 offering mobile broadband service.
Price war & the Indian regulator cause mobile stocks to tumble
The Indian mobile sector, a darling of the Indian stock markets has just fallen from grace. Fears that a renewed tariff war may bring its dream run of profit growth to an end and could force smaller players to sell out or shut shop has caused the leader, Bharti Airtel to lose 17% in two trading sessions. Reliance Communications has fallen 11% and Idea Cellular fell 8%.
Mobile tariffs in India are already the lowest in the world. On Monday, Reliance (RCOM) announced the slashing of tariffs across the board for local, roaming and long-distance calls to 50 paise, i.e under a cent per minute.
In addition to this, the Indian Telecom regulator suggested on Monday that telecom operators shift to per-second pricing as opposed to per-minute. After the Indian stock market got jittery with this announcement and telecom stocks started tumbling, the regulator (TRAI) was seen as diluting their position on this statement, stating that proposal on per-second billing was at an initial stage and too much was being read into the issue.
TRAI chairman J.S. Sarma also said that mobile operators were free to oppose the scheme and the regulator would consider their opinion during the consultation process.
Sunil Mittal, the chief of Bharti Airtel said tariffs were best left to market forces.
Reliance plans IPO for Infrastructure arm. Hopes to raise $1Bn for 10% via IPO.
India’s second largest Mobile Operator, Reliance Communication plans to seek regulatory approval for selling 10% of Reliance Infratel (its infrastructure arm) for close to $1Bn.
Reliance Infratel sold a 5 percent stake to global investors for about $290 million in 2007. It had revenue of more than $1 Bn and a profit of $300 Mn in the year ended March 31, according to Billionaire Chairman Anil Ambani.
The share sale will help fund an expansion of the nationwide network of 48,000 towers at Reliance Infratel as demand for leasing networks is likely to double in the next couple of years according to Ambani.
A mobile revolution in rural India
The total mobile penetration may have reached 14 per cent of India’s population. However, industry experts assert 13 per cent of this is in urban centres and only one per cent in villages.
The opportunity is not lost on market players like Bharat Sanchar Nigam Limited and Reliance Communications who have been present in this segment for a while.
Now Hutchison Telecom, Bharti Airtel and Tata Teleservices too have descended on the turf with big network expansion plans and innovative marketing strategies specially tailored for these regions.
“The B and C category census towns are raking in good business for us. Currently, almost 35 per cent of our business comes from these circles. However, the potential here is immense as only a per cent of the total population actually use mobile phones,” says a spokesperson for Tata Teleservices.
TTS, operating in 20 of the existing 23 mobile telephony circles in India, is using a door-to-door marketing strategy, involving members of gram panchayats and trained market-feelers to make residents of villages and small towns aware of the usefulness of mobile telephony and how the system of pre-paid refills work.
According to the company spokesperson, value-for-money handsets priced between Rs 1,000 and Rs 1,400 with a plethora of tariff plans to choose from is what is driving subscription growth in these regions.
Sanjay Kapoor, joint president, mobility, Bharti Airtel, agrees with the trend and says his company had enjoyed a growth of 166 per cent in June of 2005-06 in circle C towns, as compared to a growth of 65 per cent in metros.
“We are concentrating on improving network connectivity in the rural areas along with existing circles we and are spending $1.5 billion this year for that purpose only,” says Kapoor. Airtel is appointing distributors at the tehsil level and using existing channels of fast moving consumer goods in these areas to push their products.
Reliance Communications will also make investments to the tune of Rs 1,500 crore (Rs 15 billion) till March 2007 to enhance its network in the eight global system for mobile communication circles it operates in.
The company plans to extend its GSM network to 4,000 towns in the existing circles of Bihar, Orissa, West Bengal, Himachal Pradesh, Assam, north east, Madhya Pradesh and Kolkata. Currently, its GSM network covers 340 towns in these circles.
A company spokesperson says the company has added over 200,000 subscribers in its eight Category C circles in the previous quarter alone. Reliance is importing handsets in bulk for use in these markets and is trying to leverage its low tariff plans to increase subscriber vase.
Handset manufacturers too are gearing up. Devinder Kishore, director of marketing at Nokia India, notes that handsets priced between Rs 10,000 and Rs 15,000 are reasonably popular in these regions.
“While the handset market in India is growing at an approximate rate of 75 per cent annually, about 30 per cent of the demand comes from metros now. The rural market, therefore is growing rapidly in terms of sales and it has a tremendous potential in future,” he says.
Nokia is using channels with territorial reach like Doordarshan and All India Radio to reach the interiors. The company has also incorporated nine Indian languages on certain handsets to promote sales.
Says Dinesh Sharma, marketing and sales head of Samsung CDMA, “Sales in category C towns are growing at a rapid pace. Currently the fasted growing circles for us are the categories A and B. Sales in metros have been slower, although absolute numbers are growing as almost a per cent of urban populace buy a phone every month”.
Sharma feels that for rural areas, incorporating local languages in handsets will become a focus area in future, as will be voice short messaging service, the latter dependent on service providers.
“Rural India is keen on high feature phones but not as much as urban India. A customer in the rural area is happy to have features, which are available in the urban markets. They are happy to have colour handsets, other accessories like phone book wherein he can store details of contacts, games, alarm tones and so on,” explains H S Bhatia, National Product Group Head- GSM Division, LG Electronics India.
Industry experts feel an estimated investment of around $6.5 billion would be needed to increase India’s rural tele-density to four per cent from the current one. With the current investments, the expectation may not be far off the mark.
Source- http://inhome.rediff.com
Technorati : BSNL, Bharti Airtel, Hutchison Telecom, India, Reliance Communication
Ice Rocket : BSNL, Bharti Airtel, Hutchison Telecom, India, Reliance Communication
