Tele Gyaan

DoT

RCom in trouble – May have inflated revenues and evaded license fees to government

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anil ambani

India’s Department of Telecommunication had ordered a special financial audit into the books of some telecom operators including RCom, Bharti Airtel, Tata Teleservices, Vodafone Essar and Idea Cellular. This audit was conducted in May this year and the findings for RCom are out.

Parekh and Co., the official auditors appointed by the government, submitted an audit report to the DoT yesterday whose findings state that for the FY’08 actual wireless revenue earned by the company was only Rs 12,298 crore as against Rs 15,213 crore reported to the shareholders, which is an over reporting of Rs 2,915 crore. It also found that RCom evaded licence fee and spectrum fee to the tune of Rs 315 crore. [Read more…] about RCom in trouble – May have inflated revenues and evaded license fees to government

MTNL’s pan-India plans go bust

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State owned MTNL had plans to span its wings all across India for which it had submitted a proposal to the DoT. However, the Telecom body turned down this proposal. MTNL has its operations in Mumbai and Delhi and BSNL, the other state owned telco has its foothold all across India except these two circles. The ministry would not like to see two state run players fighting it out in the same circle, which is why the decision could have been taken.

However, ailing MTNL says that the decision will not affect its business much. This might not be the case as Mumbai and Delhi are among the most saturated circles. The operator says that it would like to further strengthen its foothold in the two markets.    

Mobile Number Portability – On its way

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Yes, if reports are to be believed, MNP will make it to the market by mid-09. It is learnt that DoT has already started the process by allowing operators to bid for the same. Here are some dates that have been earmarked:

  • Feb 6th – last day for submission of bids
  • Feb 16th – List of qualified companies to be shared
  • March 5th – results declared
  • Mid 2009 – launch, only if the above two deadlines are  met

What was decided or heard about till now was that a user would have to pay a charge to change his/her operator, which could sum upto Rs.300 or more. However, the telecom regulators have taken the responsibility of fixing this charge and making it a standard in the sector, thus disallowing any kind of malpractice.

Swan ownership under the microscope

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Swan, the telecom operator which received the license to start services last year, is under the lens of the telecom authorities. The reason – the ownership structure of the operator goes against the rules set by the governing bodies. Here’s the scenario in simple terms:

  • According to the guidelines, a telecom operator cannot hold more than 10% stake in another operator.
  • Reliance holds about 10% stake in the company, with the other investor being Tiger Traders.
  • It is learnt that the Board of the latter(Tiger) has Reliance employees.
  • Also, Reliance had also given a huge lot of redeemable preference shares to Swan, which might have an impact on their stake.

Reliance, however, states that it has a 9.9% stake, which adheres to the regulations. Currently, the DoT has asked the MCA or the Ministry of Corporate Affairs to look into the matter.

ALL Non-IMEI number phones to be blocked by 15th April

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There are still a lot of people in the country who are using cellphones without an IMEI number. Connectivity to these cellphones was suposed to be blocked by telecom operators, as instructed by the authorities. DoT has now taken things more seriously by its decision of imposing a fine on a fortnightly basis on operators failing to do their duty.

Telcos were trying to find a way out of this, by providing a software which could generate the needed number for them. However, this has been strictly disallowed. Currently the new deadline, before which the operators are supposed to do the needful, has been set to 15th April.

DoT to make the best of now: More bidders for 3G auction

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In an attempt to make the best of the situation, theDoT might just allow more operators to bid for spectrum in the 3G auction. The body has decided that it would accomodate more operators in circles, in which additional capacities exist. These additional spots would help the government to get more money and, on the same hand, make the game more competitive.

Going into specifics, it was expected that the number of operatorswhich could be accomodated would be 2-4. However, it was found some more operators could fit into circles like Kolkata, Karnataka, Andhra Pradesh and Maharashtra. The new numbers making the rounds are 6-8, which means twice the competition.

Finally it’s out: “Official” Details of the 3G Auction

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The stage is all set for Indian Telcos to fight it out in one of the fiercest battles for 3G spectrum. The day – 16th of January. Yes, the Indian Govt. has officially declared the details of the much awaited 3G auction. Here’s how the timeline looks like:

  • 23rd Dec: Pre-Bid Conference
  • 5th Jan: All applications to be submitted by this day
  • 9th Jan: Declaration of the eligible Telcos
  • 12-13th Jan – Mock Auction
  • 16th Jan – The Day

From a capacity standpoint, reports of inadequate room for all players holds true, with space for only about 2-4 players available in each circle. Given below is the availability in some circles:

  • Delhi: 2 players
  • Mumbai: 4 players or more
  • Himachal: 3 players
  • Gujarat: 3 players
  • UP: 2 players
  • West Bengal: 1 player

Clearing the air of speculations, the ministry also clarified the criteria for foreign players to bid for spectrum. Companies can bid as 100% entities, but will have to partner with an Indian company to the extent of 26% – Indian cos. share, before it launches its services.

MTNL set to unveil 3G in Delhi on December 11

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MTNL is all set to launch the much awaited 3G service on the 11th of December i.e. tomorrow. Mr. Manmohan Singh would do the honors, with the service being launched first in the capital which will then be followed by Mumbai. The service comes a month prior to the auction, in which private players would face off for the spectrum allocation.

Users will be able to experience speeds of upto 2Mbps, much higher than those currently being offered – upto 140kbps. Next service operator expected to follow suit will be BSNL.

As for the prices, it is being expected that there will be no charges for the first couple of months except the data transfers. Data transfer is expected to be charged at 2 paise per KB. However, the pricing report is unconfirmed so it would be better if we leave this thing for tomorrow.

Another important point to note here is that the launch will be a pilot test for private players, who would be planning to bid for the same. A good base for the private players to know how the market will react to the service at a particular price point.

Many players might leave empty handed after 3G auction

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Yes that’s true if a draft information memorandum of the DoT is to be believed. According to the same, the ministry’s claims of having room for about 8-10 players in each circle does not hold true. Shockingly, there is room only to accommodate a maximum of 4 players in each circle. With the Indian market being highly competitive and housing just about a dozen players, the constraint would leave many of them empty handed.

Adding to the concerns, the ministry has already handed over spectrum to the public sector players – MTNL and BSNL. This would be the worst news for rookies in the field, who would be going against biggies like Bharti and Vodafone. The true picture will be exposed as we get closer to the auction dates. Till then its more of a nail-biting time for the beginners.

3G auction gets further delayed

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9th February is the new date which has been scheduled for the much delayed 3G auction which was earlier planned for sometime in the second week of January. Department of Telecommunications (DoT) has proposed that it will issue an information memorandum that will detail the 3G auction process by December 8.

Also, a recent report by the telecom ministry has published details regarding the number of 3G operators in each circle. The details regarding some circles are as follows:

• Delhi and Gujarat will have three 3G operators each
• Uttar Pradesh and Himachal Pradesh will have four 3G operators each
• West Bengal will have two 3G operators
• Rajasthan and the north-east circles will not have 3G services because spectrum is not available in these regions
• All other circles will have up to five operators 3G operators each.

DoT’s decision to have fewer 3G operators per circle will definitely affect consumers waiting private telecom operators to offer 3G services, as DoT has decided to give first preference to state-owned BSNL and MTNL in the auction process.