Setback for GSM players in dual tech case

NEW DELHI: The Delhi High Court on Friday dismissed a petition by GSM players that challenged the government’s decision to allow telcos to offer mobile services under dual technology (both GSM and CDMA technology platforms). GSM operators had told the court that the DoT was ‘attempting to pass off a second and new license to CDMA operators in the garb of dual technology’.

The Delhi HC’s move is set to benefit existing CDMA players, all of which have applied for GSM radio frequencies under the dual technology licence. The DoT has already allotted start-up GSM spectrum to Reliance Communications, the Tatas and Shyam-Sistema for launching services on this platform.

While dismissing the petition, the Delhi HC also imposed ‘a cost’ of Rs 50,000 each on six petitioners, including Bharti Airtel, Vodafone-Essar and Idea Cellular, and their industry association Cellular Operators Association of India (COAI). The telcos have been asked to deposit this sum with the court’s legal service authority.

It is not known if GSM operators will appeal against the Delhi HC’s decision. The issue of dual technology licences is also being heard by telecom tribunal TDSAT. Industry observers say that the Delhi HC ruling could have an impact on the TDSAT’s final judgment on the issue. COAI, the GSM operators’ association refused to comment on the Delhi HC ruling. The Association of Unified Service providers of India (AUSPI), the body representing CDMA players welcomed the ruling: “This will allow our members who will soon launch GSM services to bring competition into the market. The consumers are set to benefit,” AUSPI’s secretary general S C Khanna told ET.

GSM operators had approached the Delhi HC in December 2007 following the telecom tribunal’s decision not to grant a stay on allocation of spectrum and licenses to new entrants including dual technology license holders. The COAI had said that the allotment of crossover spectrum to rival CDMA service providers by the government was in violation of Unified Access Service License regime. It had also sought that the Delhi HC quash DoT’s policy announcements on October 18 and 19, 2007 which permitted the use of dual technology.

Additionally, it had also asked the Delhi HC to turn down the DoT’s decision to endorse sector regulator TRAI’s recommendations for adoption of an enhanced subscriber-linked criteria for allocation of additional radio frequencies. The COAI had also questioned the events of 18/19 October 2007 (when the government approved the dual technology license) and had alleged that an “in-principle approval” was given to RCOM for launching GSM services even before the new policy on dual technology was publicly announced.

However, CDMA players such as RCOM in their submissions to the Delhi HC had said that that GSM players after having got more than their share of required radio frequencies and were now trying to stop others from getting the start-up spectrum for operations in the same segment.

Source : Economic Times

Read More...

Hefty price tag spoils iPhone's launch party

MUMBAI\DELHI: High price and lack of high-end 3G services seem to have dampened Apple’s iPhone launch party in India. Only a few buyers turned up at midnight launches done by both the operators across eight cities in India.

The snazzy gizmo failed to draw crowds to the stores of Bharti Airtel and Vodafone Essar in sharp contrast to the international markets where iPhone lovers had queued up the whole night to buy the handset.

The mood was subdued at the midnight launch of iPhone at Mumbai’s Infiniti Mall with Friday being a working day. The stage was set for a grand launch, complete with confetti and cheerleaders, but at the stroke of midnight, there were just 10 people who actually bought the high-end device.

At a Vodafone store in Connaught Place, Central Delhi, journalists outnumbered customers by a huge margin. Only about 15 customers turned up to buy the phone. The Airtel retail store nearby wore a deserted look on Friday afternoon, with not a single customer buying the iPhone. In Gurgaon, Airtel unveiled the iPhone at Sahara Mall.

Despite the frenzy, the D-day did not quite match the expectations with just about 35-40 people lining up to buy the coveted smartphone.

Though the launch attracted hundreds of curious onlookers late at night, very few of them were convinced enough to shell out an exorbitant Rs 31,000 for the 8 GB version and Rs 36,100 for the 16 GB one. “The pricing is a little on the high side. I would have bought it if the price was around Rs 25,000. But at 31,000, it makes little sense. I’ll wait for the price to come down,” said one of the onlookers.

Rajkumar Kanojia, who landed up at the venue much ahead of the launch, was the first person from Mumbai to get his hands on the phone.

“I am buying the 16 GB version because it’s not much expensive than the 8 GB version. Since I am into business, it’ll help me combine my work and pleasure into one compact device,” he said.

Maharaja of Jaipur, Bhawani Singh, and football captain Baichung Bhutia were the first customers of Vodafone Essar in Jaipur and Kolkata respectively. In Delhi, Nishant Arya, owner of JBM Group, a Rs 2,500-crore auto components company, claimed to be the first legal buyer of iPhone 3G in India.

Over two lakh users had pre-registered with Airtel for the iPhone, but only around 5,000-5,500 may have actually bought or booked the handset across the company’s stores in 65 cities, said sources.

Bharti Airtel president (mobile services) Sanjay Kapoor brushed off the fear of iPhone turning out a damp squib because of high cost. “We are targeting the high-end user segment as well as the youth, which does not cares much about the pricing if the product is good,” he said.

Source : Economic Times

Read More...

Vodafone looking at instalment scheme to sell iPhone

NEW DELHI: Vodafone, one of the two license holders for the latest Apple iPhone that went on sale at midnight Thursday in India, is looking at easy finance schemes to help sell the product in the country, a person familiar with the development said.

"Vodafone is talking to Barclays and ICICI Bank for introducing two monthly schemes for six and 12 months," the person requesting anonymity told IANS Friday.

Bharti Airtel, the other license holder in India, declined to make any comment, but it is believed it too is talking to several banks.

The Apple iPhone 3G (third generation) was launched in Singapore and the Philippines apart from India Thursday. While it costs around Rs.8,000 in the US where Apple is headquartered, it costs around Rs.9,840 in Singapore.
In India, the iPhone is priced at Rs.31,000 for 8GB and Rs.36,100 for 16GB of memory space.

Now, to push sales, Vodafone is trying to increase iPhone sales by arranging for financing schemes for its products.
"We expect to sell anywhere between 50 to 100 phones a day," the source said. "However it is too early to predict how the sales will shape up."

Airtel gave a similar response.

Said Sanjay Gupta, Airtel's chief marketing officer: "We will only be able to figure out the trend only after a week or so. The response has been overwhelming but it's still not clear how many of the pre-bookings will actually convert to sales."

Airtel received over 200,000 pre-bookings for the phone, the process was started about two months ago.
They grey market, which has been raking in the moolah on iphones for more than a year were despondent. Dealers at Delhi's Gaffar Market - centre for electronics goods sale - were of the opinion that with the phone being sold by authorized dealers their share in the pie would be reduced to nil.

"We were selling the 3G version till a few days ago for anything between Rs.40,000 to Rs.55,000. There will always be people who will spend anything. The [older] 2G version sold for around Rs.24,000-25,000. Now, we will have to undercut," said a dealer in Gaffar Market.

The iPhone is being sold in Hyderabad and Bangalore besides the four metropolitan cities and will be later introduced in 65 cities.

The phone comes locked to the service provider, which means a user cannot switch his or her operator while using an iPhone.

However, the availability of a number of software in the market for hacking the iPhone has not gone unnoticed by telecom operators.

"We are aware of the hacking software that are available and are used to unlock the iPhone, but customers who will stay with Airtel will be able to enjoy iPhone's full benefits including the data plans," Sanjay Kapoor, Airtel's president (mobility) said.

The phone, which won Time magazine's coveted 'Invention of the Year 2007' honour, and marked the Cupertino-based computer giant's foray into the mobile phone arena, debuted in June last year.

"More than 30,000 iPhone's (2G) are running on the Airtel network alone," Sanjay Kapoor said.

Source : Economic Times

Read More...

TRAI's STD move to hit telcos

NEW DELHI: Telecom regulator TRAI’s move to ask the government to give customers the freedom to choose their long-distance carrier for STD and ISD services, coupled with the introduction of internet telephony, is set to impact the bottom lines of all service providers. ET spoke to several telecom analysts and market watchers who were of the view that if DoT were to give a go ahead for both sets of the regulator’s recommendations, it would result in a 33% to 77% fall in telcos’ revenues from long-distance services. About 10-20% of the service providers’ total revenues come from long-distance services.

ET first reported on Wednesday that TRAI would ask the government to give customers the freedom to choose their long-distance carrier (via calling cards) a move that will lead to cheaper tariffs—both STD and ISD. While telcos stand to lose, the consumer will be the biggest beneficiary. Telecom tariffs in India, which are already the lowest in the world, are set to fall further.

“In overall terms, the revenue loss for the telcos may not be much, but it will be significant as long-distance services offer moderately higher margins. These recommendations are the final mail in the coffin and truly rings in the death of distance. Since many service providers already have the long distance infrastructure in place, they may forced to offer flat charges. First, they may have to do away distance based tariff structure. At a later stage, they may even have to do away with duration based charges,” explains Mahesh Uppal, director, Com First (India) and a consultant on regulatory issues in telecom.

“Operators have no choice but lower their long distance tariffs. We are set to move to a system where there is large scale bundling where service providers will provide certain number of local and long distance minutes free. Telcos revenues will not fall from current levels, but their total sales will not increase at the same rates as in the past.

In the long term, India’s telecom stocks may lose some of its shine,” added an analyst with a leading brokerage firm. According to Rohit Prasad, who is a telecoms analyst and a professor at Management Development Institute (MDI), Gurgaon, telcos would try to hit back by using the interconnect regulation in the favor. Currently, all long distance calls involve carriage and termination costs. “In the case of both internet telephony and calling cards, interconnect agreement will be the key to their success,” he added.

As reported earlier by ET, TRAI on Wednesday asked the Department of Telecom to permit all national and international long distance carriers, which include several non-mobile operators such as Gail, Powergrid, RailTel, Sify, Tulip IT, AT&T, British Telecom, France Telecom, Cable and Wireless and Verizon amongst others to market their products directly to the consumer in the from of pre-paid package or through calling cards.

Source : Economic Times

Read More...

Idea among five operators agree to provide link to RCom GSM

NEW DELHI: Ahead of the deadline of TRAI's direction to give interconnection to RCom GSM network, five operators, including Idea Cellular, MTNL and Tata Communication have agreed to provide link of their network to the Anil Ambani group company.

According to sources, Idea Cellular has agreed to provide interconnection to RCom thereby not becoming a part of COAI's likely petition against TRAI's directive on the same. Besides, other operators to provide interconnectivity to RCom GSM network are Aircel and Spice Communication.

The other PSU BSNL, which has also been directed by TRAI, is in negotiation with RCom. "We are in a dialogue with them (RCom)... There has been no conclusion yet on the outcome of our talks on a agreeable interconnection arrangement," BSNL CMD Kuldeep Goyal had said yesterday. So now, it is Bharti and Vodafone, who are yet to consider giving interconnectivity to RCom.

However, the latest position could influence COAI's decision to challenge the TRAI's order although it could not be confirmed whether COAI would change its position or not. On August 14, telecom regulator TRAI had directed GSM players Idea Cellular, BPL, Vodafone Essar and Bharti Airtel to interconnect with RCom by August 21. Aircel, Spice, Idea are members of COAI.

Source : Economics Times

Read More...

You can soon pick your best STD plan

NEW DELHI: You’ll soon get to choose the cheapest STD and ISD tariffs, irrespective of your service provider. After recommending that internet telephony be opened up, telecom regulator TRAI this week will mandate that telcos offer their subscribers the freedom to choose a carrier of their choice for making long-distance calls, whether domestic (STD) or international (ISD).

This will start a new era of competition in long-distance calls, provided the government acts promptly to amend licence conditions to enable telcos comply with the TRAI directive.

What TRAI has in mind is not quite implementation of the carrier access code (CAC) project mooted several years ago. In the face of resistance by telcos to CAC and the willingness of the Department of Telecom (DoT) to play along with them, TRAI has come up with a variation. This is how it will work. Suppose, you are a Bharti subscriber and you find out BSNL is offering the cheapest long-distance tariffs.

You then buy a pre-paid long-distance package from BSNL for a specific duration. You punch in a set of numbers specified in the package to get on to the BSNL network, and then proceed to make the long-distance call you wanted to, and talk for as long as your pre-paid package permits.

The regulator will also mandate that all telcos offer their customers the facility to purchase pre-paid long-distance packages or virtual calling cards on the internet. Globally, long-distance tariffs have fallen between 20% and 53% after customers were allowed to choose their operator. Even players like PowerGrid, RailTel and Gail, who have long-distance backbones, can offer this facility along with telcos that provide customer access.

The TRAI directive is bound to hit the bottomlines of major operators. Telecom stocks were already down on Tuesday following TRAI’s recommendations on net telephony.

Net telephony may hit telcos’ bottomlines

Because, if the DoT accepts TRAI’s proposals on net telephony, it will adversely impact the business models of all telcos. In Tuesday’s trading, Idea Cellular was down 5.05%, Reliance Communications fell 3.06% while Bharti Airtel and Tata Teleservices slid 2.1% and 1.8%, respectively.

ET has learnt that TRAI has decided on this move as the DoT has failed to implement the much-delayed CAC. The implementation of CAC would have allowed subscribers to choose the long-distance operator of their choice to make STD/ISD calls without having to purchase any pre-paid package.

Telcos have always opposed CAC on the grounds that each player will have to shell out about Rs 5,000 crore for network upgradation before they can offer this facility.

“Allowing consumers the freedom to choose their long-distance service provider over pre-paid packages is our answer to DoT’s failure to implement CAC. TRAI will no longer push for the implementation of CAC and the issue will be buried. Under the new system, telcos can no longer complain about network upgradation costs and stop its implementation. All telcos have intelligent networks in place to handle this service,” a top TRAI source told ET.


“This will be a directive to telcos. We will ask the DoT to make the requisite changes in the licence conditions of telcos so that they can offer this facility,” the TRAI source added.

TRAI officials also say that in addition to increasing competition among service providers, offering customers the freedom to choose their long-distance operator will also open up revenue streams for other long-distance licence holders. For instance, players such as PowerGrid, RailTel, Gail, Sify, AT&T, British Telecom and Tulip Telecom, among others, who have fibre networks in India can now directly compete to carry calls of operators. This implies, Bharti, Vodafone or Idea customer can now specifically buy a package from Gail or PowerGrid to carry his STD calls if these companies offer cheaper tariff rates.

TRAI sources also added that all long-distance carriers would have to enter into mutual agreements. “In case operators do not agree on interconnect agreements, we will step in and facilitate timelines and also stipulate penalties for delay in signing contracts and implementation,” they added.

This facility will, however, not be extended to local calls. Several NLD operators have pointed out that due to large volumes of local calls, customers prefer to work with incumbent operator. Besides, globally extending this facility for local calls have not yielded customer preferences and they have continued to use the incumbent operator.

Source : Economic Times

Read More...

BSNL in talks with RCOM for interconnection

NEW DELHI: Directed by telecom regulator TRAI, state-run BSNL is in dialogue with Reliance Communication (RCOM) to work out an amicable interconnection arrangement for the Anil Ambani group firm's GSM network.

"We are in a dialogue with them (RCOM)... There has been no conclusion yet on the outcome of our talks on a agreeable interconnection arrangement," BSNL CMD Kuldeep Goyal told reporters.

When asked whether BSNL would challenge the TRAI directive, he said "Whether we will challenge the TRAI directive on providing interconnection to RCOM or not depends on the outcome of these talks. Let us see what happens before August 21," he added.

On August 14, TRAI had directed GSM players Idea Cellular, BPL, Voadafone Essar and Bharti Airtel to interconnect with RCom by August 21.

It has also asked state-run BSNL to link up with RCom but the PSU is not a part of the COAI petition.

In a related development, Aditya Birla Group company Idea Cellular is understood to have also worked out a similar interconnection pact with RCOM, according industry sources.

However, it could not be confirmed as Idea Cellular Chairman Sanjiv Aga declined to comment.

A company official, however, said Idea was negotiating with RCOM on the interconnection. But he declined to comment on the outcome.

When contacted T V Ramachandran Director General of COAI, the GSM operators' body, said he had no idea about Idea Cellular's interconnection pact with RCOM.

"But if Idea agrees to interconnect with RCOM it does not become a part of our proposed petition to TDSAT. However, our position to challenge TRAI directive stands," Ramachandran said.

Bharti, Vodafone and BPL now are part of COAI's petition.

Source : Economic Times

Read More...