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TCIL stake sale in Hexacom gets DoT nod; Bharti may pick up 30% stake
The Department of Telecom has given its approval to divesting the 30 per cent stake held by Telecommunications Consultant of India Ltd in Bharti Hexacom, a company which offers mobile services in Rajasthan.
The stake sale has been hanging in the balance for more than three years. The Government had so far taken a stance not to divest State-owned TCIL’s stake. However, with the Left withdrawing its support, political equation at the Centre has changed allowing the Government to move ahead with its divestment plans.
The decision to approve the stake sale was taken at a meeting of the Telecom Commission, the highest authority in DoT, on August 21. DoT will now take the proposal to the Union Cabinet for approval.
If TCIL sells its stake, Bharti Airtel will have the first right of refusal. Bharti had earlier expressed interest in acquiring the stake but could not do so without Government approval. Bharti already owns about 70 per cent stake in Hexacom after it had bought out majority shares from Shyam Telecom. Bharti had paid about Rs 430 crore for buying out Shyam’s stake in 2004.
3G spectrum: DoT delays bidding for e-auction agency
The Department of Telecommunications (DoT) has delayed the opening of invites for the agency which will decide e-auction of spectrum for 3G and Broadband Wireless Access (BWA).
The opening of bids has been deferred to September 22 from September 3 as decided earlier. The pre-bid conference, which was to be held on August 27, has also been re-scheduled to September 8.
However, according to the revised schedule issued by the communications ministry, there will be no delay in the date of identifying the agency. The finalisation of the bids will be completed by September 30 as announced earlier by Telecom Secretary Siddhartha Behura.
The request for proposal (RFP) for the agency was floated on August 14 in order to select an agency for e-auction of spectrum for 3G and BWA in 22 telecom service areas in the country.
DoT rejects TRAI’s call for 3G policy review
In a move that would keep the roll out of third generation services on track, the Department of Telecom has rejected telecom regulator’s call to review some parts of the recently announced third generation policy.
The TRAI had sought a review on several issues in the policy – the key one being DoT’s decision to allocate spectrum to CDMA players based on subscriber numbers. The regulator had also asked the Government to refer the issue of allowing new and foreign players back to TRAI so that it can suggest the terms and conditions of the new licence category.
Rejecting TRAI’s view on foreign players, an internal DoT note said, “ The unified access licence are authorised to provide triple play – voice, data and video without any limit on speed of data. 3G service providers are not new category of licensees and they shall be offering 3G services under terms & conditions of the UASL licence. Therefore, the provision of the TRAI ACT 1997 is not applicable in this situation.”
Telcos plan rural push in Bengal
Telecom companies will invest over Rs 1500 crore this year in West Bengal to improve rural connectivity and mobile telecom penetration.
The companies are also planning to offer differentiated tariff structures to push mobile subscriber base in rural West Bengal.
The move comes in the wake of the government deciding to give financial incentives to operators who roll out services in rural areas.
The Department of Telecom has recently waived the licence fee from revenues earned from fixed line phones in rural areas. DOT's aim is to achieve rural tele-density of 25 per cent by means of 200 million rural connections at the end of the Eleventh Plan.
Govt starts process to look for new Trai chairman
The government has initiated the process to look for a successor to head the Telcom Regulatory Authority of India (Trai), whose present chairman Nripendra Misra retires on March 21, 2009.
The Department of Telecommunications has sought permission from the cabinet secretariat to constitute a search committee for the selection of Trai chairperson.
After 3G, Trai differs with DoT on mobile number portability too
In yet another instance of disagreement with policymakers, Telecom Regulatory Authority of India (Trai) has questioned the Department of Telecommunication’s (DoT’s) decision to divide the country into two zones instead of one as recommended by the telecom regulator for mobile number portability (MNP) facility.
DoT invites bids to conduct 3G spectrum auction
Amid its differences with the Ministry of Finance, the Department of Telecommunications (DoT) today started the process for 3G mobile services and invited bids from Indian and foreign companies to conduct the auctioning of spectrum in 22 telecom service areas.
Issuing the Request for Proposal (RFP), the DoT has convened a pre-bid conference on August 27 and will open the financial bids, of those who qualify technically and meet all the criteria for selection, on September 19.
According to the eligibility criteria, the bidder shall not have any equity directly or indirectly in any telecom or Internet service provider (ISP) in India. Similarly, any telecom company or ISP shall not have any stake in the bidder company.
DoT rejects Amar Singh’s spectrum pricing formula
The Department of Telecom (DoT) has rejected the Samajwadi Party leader Mr Amar Singh’s formula for levying a charge on GSM-based mobile operators with excess spectrum over 6.2 Mhz.
DoT has instead suggested its own method of imposing the one-time charge
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The Department of Telecom (DoT) has rejected the Samajwadi Party leader Mr Amar Singh’s formula for levying a charge on GSM-based mobile operators with excess spectrum over 6.2 Mhz.
DoT has instead suggested its own method of imposing the one-time charge at the rate of Rs 266 crore for each unit of spectrum beyond 6.2 Mhz, which is the maximum quantum of start-up spectrum specified in the licence agreement.
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Mr Singh had proposed a formula whereby existing GSM players would have had to pay Rs 1,312 crore for each unit of spectrum beyond 6.2 Mhz. The basic assumption for this proposal was that the mobile operator’s licence agreement does not specify allocation of more than 6.2 Mhz.
New telecom operators to pull down user revenue
The new telecom licensees, which are planning to start operations in rural and semi-urban sectors, are likely to end up earning from only entry-level customers. This, experts say, will bring down the industry’s average revenue per user (ARPU), which is us
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The new telecom licensees, which are planning to start operations in rural and semi-urban sectors, are likely to end up earning from only entry-level customers. This, experts say, will bring down the industry’s average revenue per user (ARPU), which is used to measure a telecom company’s financial strength.
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Most new players are expected to start operations with an ARPU of as low as Rs 100 per month. This is almost one-third the existing ARPU (for both pre- and post-paid customers) of around Rs 280 per month.
The new players, including Videocon-controlled Datacom Solutions, Unitech, Shyam Sistema, Swam Telecom, STel and Essar Group firm Loop Telecom, are expected to start operations by the end of this year. Also, existing GSM operators like Idea Cellular, Tata Teleservices Ltd and Reliance Communications are looking at expanding into new circles.
Financial Express : Calls from PCs to make long-distance tariffs cheaper; ISPs to gain
Long-distance telecom tariffs could dip again with the telecom regulator expected to announce the rules permitting calls from personal computers to fixed line and mobile phones. Currently, a voice call can travel between two computers but not from a mobil
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Long-distance telecom tariffs could dip again with the telecom regulator expected to announce the rules permitting calls from personal computers to fixed line and mobile phones. Currently, a voice call can travel between two computers but not from a mobile or a fixed phone. This is expected to open huge channels of revenues for the Internet service providers, ISP’s who wouldn’t need to acquire a Unified Access Service Licence (UASL) for operating these services.
This would also benefit the telecom service providers like Vodafone and Idea who don’t have national long distance licence/network and use other operators’ networks to carry long distance calls. These operators can carry their NLD calls using their IP network.
The Telecom Regulatory Authority of India (Trai) is going to announce these recommendations on Monday, despite the misgivings of the current UASL holders . The new competition would push up the heat for established UASL holders such as Bharti Airtel, Reliance Communication, Vodafone and BSNL.
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Telecom players have to shell out Rs 1,650 crore for a pan-India UASL, while ISPs pay token Re 1 as the licence fee and the ISPs providing PC to PC telephony have to pay 6% of their adjusted gross revenue.
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Financial Express : Telcos, ISPs lock horns over IP telephony
Even before the Telecom Regulatory Authority of India (Trai) has taken its first steps towards allowing connectivity between PCs and phones, telecom operators and Internet service providers (ISPs) are locking horns over the issue.
In separate communications to the regulator, Bharti Airtel and Reliance Communications have stated that if voice over Internet protocol—or, VoIP, which basically means using the Internet for telephone calls—is allowed, ISPs should be asked to migrate to the unified access service licence (UASL) regime.
State-owned Bharat Sanchar Nigam Ltd (BSNL) has gone even further to state that PC-to-phone calls should be disallowed, as it would destroy the national long-distance structure.
At stake is the wide difference in licence fees paid by telecom service providers and ISPs. The former pays Rs 1,650 crore for a pan-India licence fee, while ISPs pay a token fee of Re 1. Currently, Internet telephony is allowed but only from PC to PC, for which ISPs pay 6% of their adjusted gross revenue.
Financial Express : Spectrum not a barrier for new players
Telecom companies can now start providing services without getting the key raw material— spectrum —from the government. Thanks to a recent clarification “subtly” made by the department of telecommunications (DoT), new telecom players like the realty major Unitech and Videocon-owned, Datacom, which have been granted licences but no spectrum, can start commercial operations by getting into intra-circle roaming pacts with existing operators.
The clarification dated June 12 basically allows operators to enter into mutual commercial agreements for intra-service roaming facilities with other licensed operators. With this, analysts said, the new operators without spectrum could put up mobile switching centres (MSCs) and get into pacts with existing operators for spectrum. This way, these operators can start operations, that too, without building any network by just trading in spectrum, which is otherwise not permissible. This will also ensure them a good valuation without investing much in creating any infrastructure.
3G policy guidelines to be out in June: Raja
The much-awaited guidelines for the 3G policy will be out this month, assured Communications Minister Andimuthu Raja today. Speaking on the sidelines of a conference, the minister said, "It has been delayed for some time. I will ensure that the policy is out by the 30th of June."
"I met both the finance secretary and the telecom secretary today. The guidelines for 3G, spectrum auction, as well as on participation of players, will be out this month," he added.
Global bidding for 3G is okay with Law Ministry
In what could be good news for foreign telecom companies wanting to invest in India, the Union Ministry of Law and Justice has suggested that the Communication Ministry may take the issue of following an open auction for third generation mobile services to a Group of Ministers if it wanted to overrule the views expressed by the Telecom Regulatory Authority of India.
While the Telecom Regulatory Authority of India has expressed concerns against an open auction on the grounds that existing players were more prepared for 3G mobile services, the Communication Ministry is in favour of inviting bids from international players also.
The Finance Ministry has also backed Communication Ministry on the grounds that an open auction will get more revenues for the Government.
TRAI has, however, told the Government that such a decision cannot be taken legally without considering the views of the regulator.
Telecom players divided over WiMax spectrum pricing
The telecom regulator’s move to review the spectrum pricing for wireless broadband services using technologies such as WiMax has divided the telecom industry.
While the GSM operator’s lobby Cellular Operators Association of India (COAI) has pushed for parity between the price for third generation mobile and WiMax to keep the playing field level, others — including Reliance Communication and Intel — want the spectrum for WiMax to be priced lower to make broadband services more affordable.
The outcome of this debate will have an impact on what consumers pay for wireless broadband services.
DoT asks RIM to find solution for Blackberry
The Department of Telecom (DoT) had another round of discussion with Research In Motion (RIM) in a bid to find a solution to the security concerns around Blackberry services.
DoT had asked the company to come out with a solution that would enable Indian security agencies to monitor data being transmitted through Blackberry devices.
RIM has already told DoT that it cannot give the codes to the device since it has been designed in such a way that it does not allow anyone, including RIM, to know the content of any email being sent through the device.
RIM also said that setting up a local data centre in India would not help in addressing the security needs since the network design would not allow anyone to snoop into the system at any point of the transmission.
DoT removes cap on number of bandwidth resellers
In a move that would improve the availability of cheaper international bandwidth in the country, the Telecom Commission, the apex policy making body of the Department of Telecom, has given its approval for allowing unlimited number of bandwidth resellers in the country.
Bandwidth resellers are companies, which do not own any infrastructure, but buy capacity from large international long distance service providers like VSNL or AT&T and then resell it to consumers like business process outsourcing units. This could result in cheaper Internet services and international long distance calls.
The move will benefit larger consumers of bandwidth such as ITeS companies, BPOs and Internet service providers who will be able to buy bandwidth from the resellers at much lower costs.
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In a move that would improve the availability of cheaper international bandwidth in the country, the Telecom Commission, the apex policy making body of the Department of Telecom, has given its approval for allowing unlimited number of bandwidth resellers in the country.
Bandwidth resellers are companies, which do not own any infrastructure, but buy capacity from large international long distance service providers like VSNL or AT&T and then resell it to consumers like business process outsourcing units. This could result in cheaper Internet services and international long distance calls.
The move will benefit larger consumers of bandwidth such as ITeS companies, BPOs and Internet service providers who will be able to buy bandwidth from the resellers at much lower costs.
Licensing proposed for telecom content providers - IndianExpress.Com
The Telecom Regulatory Authority of India (TRAI) today initiated a move to bring value added service (VAS) providers under a licensing regime. Ring tones, video clippings, games and SMS-based services are value-added services.
In a consultation paper released today, the regulator has sought industry’s views on “need to bring content provider/aggregators called Value Added Service Providers (VASPs) under the licensing regime.”
In India, the revenue from mobile VAS is anywhere between 10 per cent and 14 per cent of the total revenue. It is expected to cross 30 per cent of the mobile telecom service provider’s revenue in the next 5-7 years, say experts. Today, SMS constitutes major a portion of the VAS revenue. While entertainment services have become popular with consumers, there is scope for utility-based services such as location information, mobile commerce (M-Commerce) for transactions.
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The Telecom Regulatory Authority of India (TRAI) today initiated a move to bring value added service (VAS) providers under a licensing regime. Ring tones, video clippings, games and SMS-based services are value-added services.In a consultation paper released today, the regulator has sought industry’s views on “need to bring content provider/aggregators called Value Added Service Providers (VASPs) under the licensing regime.”
In India, the revenue from mobile VAS is anywhere between 10 per cent and 14 per cent of the total revenue. It is expected to cross 30 per cent of the mobile telecom service provider’s revenue in the next 5-7 years, say experts. Today, SMS constitutes major a portion of the VAS revenue. While entertainment services have become popular with consumers, there is scope for utility-based services such as location information, mobile commerce (M-Commerce) for transactions
TRAI cautions DoT against overriding regulatory procedures
The Telecom Regulatory Authority of India (TRAI) has cautioned the Department of Telecom against taking any decision on policy matters without consulting it.
In a note written to Mr Siddarthha Behura, Secretary, Department of Telecom; TRAI’s Chairman, Mr Nripendra Misra, said that the recommendations of the regulator is required according to existing laws and DoT should keep this in mind to avoid any legal complications.
TRAI said that it had come to know that DoT was planning to amend licence term for unified access service and basic telecom providers.
Government may decide to scrap BlackBerry services
Inability on part of the Canada-based firm Research In Motion (RIM), the vendor of ‘BlackBerry’ smartphones, to allow Indian security agencies to read messages or e-mails of its users is likely to further complicate matters, and could even lead to scrapping of BlackBerry services in the country.
According to RIM: “The BlackBerry security architecture for enterprise customers is based on a symmetric key system whereby the customers create their own key and only the customer ever possesses a copy of his encryption key.
“RIM does not possess a ‘master key,’ nor does any ‘back door’ exist in the system that would allow RIM or any third party to gain unauthorised access to the key or corporate data.
“The BlackBerry security architecture for enterprise customers is purposefully designed to exclude the capability for RIM or any third party to read encrypted information under any circumstances. RIM would simply be unable to accommodate any request for a copy of a customer’s encryption key since at no time does RIM, or any wireless network operator, ever possess a copy of the key,” the company has said.
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Inability on part of the Canada-based firm Research In Motion (RIM), the vendor of ‘BlackBerry’ smartphones, to allow Indian security agencies to read messages or e-mails of its users is likely to further complicate matters, and could even lead to scrapping of BlackBerry services in the country.
According to RIM: “The BlackBerry security architecture for enterprise customers is based on a symmetric key system whereby the customers create their own key and only the customer ever possesses a copy of his encryption key.
“RIM does not possess a ‘master key,’ nor does any ‘back door’ exist in the system that would allow RIM or any third party to gain unauthorised access to the key or corporate data.
“The BlackBerry security architecture for enterprise customers is purposefully designed to exclude the capability for RIM or any third party to read encrypted information under any circumstances. RIM would simply be unable to accommodate any request for a copy of a customer’s encryption key since at no time does RIM, or any wireless network operator, ever possess a copy of the key,” the company has said.
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