Sunday, May 23, 2010

3G Auction Ended

The auction for 3G mobile licence ended today with RCom, Bharti and Aircel bagging 13 circles each, and will leave the government with a Rs 67,710 crore revenue windfall.

However, no single operator managed to bag all 22 circles on offer — the total bid price for which touched Rs 16,750.58 crore on the 34th day of bidding today.

Anil Ambani-led RCom will pay Rs 8,585.04 crore towards the 3G licence, but the single largest outgo would be from Bharti that will pay Rs 12,295.46 crore.

Vodafone, which is second in terms of fee outgo, would be paying over Rs 11,617 crore for licence to offer high-speed voice and data service in nine circles.

Key circles Mumbai and Delhi went to Bharti, Vodafone and RCom.

Bharti complained that the auction format and severe shortage drove up the prices beyond reasonable levels.

The government had fixed a reserve price of Rs 3,500 crore for 3G spectrum and had originally estimated to raise Rs 35,000 crore from the sale.

"We would like to point out that the auction format and severe spectrum shortage, along with ensuing policy uncertainty, drove the prices beyond reasonable levels. As a result, we could not achieve our objective of pan-India 3G footprint in this round," Bharti said in a statement.

Nine operators, who were in the fray for three-four slots of spectrum, had welcomed the format in the mock auction.

"They knew what they were bidding. I'm quite certain we should respect the market determined price," telecom regulator J S Sarma said.

"I calculated Rs 35,000 crore (revenue from 3G and Broadband Wireless spectrum sale) in the Budget. I'm getting Rs 67,000 crore, almost double. So, (I will get) that much elbow room," Finance Minister Pranab Mukherjee said today.

The revenue mop up will help the government cut its fiscal deficit to nearly 4.9 per cent from 5.5 per cent of GDP projected in the Budget.

"I'm happy to see that the government is going to earn more than expected," Telecom Minister A Raja said.

Delhi spectrum went for Rs 3,316.93 crore, while that the bid for Mumbai closed at Rs 3,247.07 crore.

The auction of Broadband Wireless Access spectrum will start in two days and could push up the government's revenue mop up. The reserve price for BWA radio waves is Rs 1,750 crore for pan-India licence and 11 players are in the fray to grab the two slots on the block.

Sunday, April 25, 2010

GPRS UNLIMITED WAR

India’s mobile market, over crowded by around 17 mobile operators shows intense competition – which helps to drop down call rate as low as half a paisa per second and SMS over India costs merely 1paisa! But it is sad data tariff or Internet on mobile Phones is not that cheap.
GPRS/EDGE speed is often too slow to surf Internet unlimited Low Cost GPRS/Mobile Internet is offered by a few operators in 2G segments, incidentally BSNL and MTNL the Govt owned operators offering some attractive limited plans and Unlimited Faster Data Connectivity on 3G network at Rs 2500, well that is out of reach of most people, still you can expect it to be cheap in future.
Interestingly CDMA operators has not entered Internet-on-the-go in that exclusively way, though they are in Data card business with 3.1 Mbps EVDO technology. Tata Indicom recently rolled out Photon+ on mobile, though tariff will keep most users at a bay with a few handset supported! MTS has not entered Internet on the go services (on Mobile Phones) till.
Aircel is pioneer in cutting down GPRS price, offering unlimited net-on-mobile or on PC at just Rs 98 for a period of 30 days. Aircel even has a trial pack of Rs 14 offering unlimited Internet for 3 days. Aircel GPRS speed is not bad, but differs circle to circle, zone to zone and time to time, peak hours offers slower speed and this is applicable to all operators. MTNL has same GPRS tariff like Aircel on 2G network.
Airtel brought GPRS tariff cut down to compete Tata Docomo’s offers, now offering internet on phone/PC 2GB for Rs 98 for 30 days. Tata Docomo is also offering GPRS services, offering 200MB free usage in day and 4GB at night at Rs 95 for 30 days. For high end users Tata Docomo is not a good option. Reliance GPRS is also costly. BSNL has different packs for different needs in different circles;  (Check Tata Docomo vs BSNL GPRS) Vodafone has one of the few operators who did not hear to market needs. Recently in Kolkata circle, Vodafone launches unlimited GPRS at an affordable Rs 251 for 30 days. Idea fails to create hype in GPRS market, offering some crappy pack in some circles, basic browsing comes at a 2paisa/KB compared to others’ 1p/KB or 10p/KB! STel has to roll out GPRS.
Now enter Uninor! Though Uninor’s voice tariff failed to attract Indian people, this time Uninor (and Telenor too) understands the value-for-money sentiment of Indians and stirs the market with its GPRS packs. Uninor is offering 3GB internet at Rs 90 for 30 days with free browsing on Facebook, Orkut and Twitter. It’s a damn good deal! Uninor with free browsing on Facebook and Twitter outnumbers Tata Docomo (don’t count Buddynet with daily rental Re1)! As Uninor’s network is less congested, speed is expected to be good enough.
Have a look to compare GPRS(2G) Packs:

Unlimited pack Other pack (taken maximum free usage) Post free usage charge
Aircel Rs 98, 30 days Rs 14,3 days N/A N/A
MTNL(2G) Rs 98, 30 days Rs 14, 3 days N/A N/A
Airtel N/A Rs 98, 2GB,30 daysRs 23, 200MB,3 days 30p/50KB
BSNL(2G) Rs 274, 30 days Rs.219 ,1 GB (day)- 4 GB (night), 30 days 1p/10KB
Tata Docomo N/A Rs 95, 200MB (day)- 4 GB (night), 30 days 50p/MB
Uninor N/A Rs90, 3GB,30 daysRs9, 60MB,3 days 10p/10KB

Sunday, April 4, 2010

ZTE Corporation Appoints New President

ZTE Corporation (“ZTE”) (H share stock code: 0763.HK / A share stock code: 000063.SZ), a leading global provider of telecommunications equipment and network solutions, today announced Mr. Shi Lirong has been appointed as President of ZTE by the company’s Board of Directors. Mr. Shi replaces Mr. Yin Yimin, who successfully served as ZTE President during the company’s fourth term for a period of 6 years.
Mr. Shi Lirong and his new management team will adhere to the strategic direction defined by the board of directors and strive to continue growing all areas of ZTE’s businesses. They will focus on analysing changes in the global telecom market, driving innovation and high-quality products in the wireless/wireline and handset markets, and satisfying the dynamic and individual needs of ZTE customers. In addition, the team will leverage the opportunities enabled by the 3G and 4G eras, to make further inroads into the European and U.S. markets. It will also strive to continuously improve the Company’s profits and operational efficiency, execute management duties entrusted by the board, and return strong achievements to shareholders and staff.
“We are very pleased to announce Mr. Shi Lirong as the new President of ZTE,” said Mr. Hou Weigui, Chairman of ZTE. “We are very confident that Mr. Shi, with his profound knowledge and experience in comprehensive fields ranging from technology, research & development, production management and long-term global marketing system, is capable of driving ZTE to the next level of success on the international business stage.”

3G & BWA Auction Analysis

With an application from market leader Bharti Airtel Ltd. (Mumbai: BHARTIARTL) already on the table, and with the deadline for submissions ending today, the remaining, major, privately held Indian mobile operators have all put their names forward to take part in the 3G spectrum auction.
And most have also put their names down for the separate BWA (broadband wireless access) spectrum auction, too. Until this week, that auction looked to be the domain of the WiMax hopefuls. Now, though, there's a mix of potential technologies that could be deployed in the 2.3GHz band, including TD-Long Term Evolution (LTE).
The large international service providers that had been identified as potential bidders for 3G spectrum in India, such as AT&T Inc. (NYSE: T), BT Group plc (NYSE: BT; London: BTA), and Telstra Corp. (Pink Sheets: TLSYY), have not applied.
Foreign interest in India's new spectrum is limited to those companies that already hold stakes in local operators, such as Vodafone Group plc (NYSE: VOD), Etisalat , Maxis Communications Bhd. of Malaysia, which has a majority stake in Aircel Ltd. , and Bahrain Telecommunications Co. (Batelco) , an investor in startup operator S Tel Pvt. Ltd.
In addition, Augere Holdings, which offers wireless broadband services in Pakistan and Bangladesh, has created a new subsidiary to apply for a place in the BWA auction, and one of its financial backers is France Telecom SA (NYSE: FTE).
Rush for 3G
Reliance Communications Ltd. , Vodafone Essar , Tata Teleservices Ltd. , IDEA Cellular Ltd. , and Aircel have all filed to take part in the auction of 3G spectrum, along with minnow S Tel (which only operates in three circles).
New entrants Etisalat DB, which has yet to launch its GSM services, and Videocon Telecommunications Ltd. (a.k.a. Datacom Solutions), which has just launched its first GSM services in the Tamil Nadu circle, have also submitted applications, though it's not known currently whether they have applied to bid in all 22 circles or just in select areas. (See table below.)

Table 1: Applicants for India's 3G Spectrum Auction

Name
   

Number of current mobile customers (at end of January 2010)

Bharti Airtel
   

121.7 million

Reliance Communications
   

96.6 million

Vodafone Essar
   

94.1 million

Tata Teleservices
   

60.3 million

IDEA Cellular
   

59.9 million

Aircel
   

33 million

S Tel
   

0.5 million

Videocon Telecommunications
   

Just launched 2G service

Etisalat DB Telecom
   

Not yet launched 2G service

Source: India's Department of Telecom

And they're all after a limited resource that the operators need to meet the ongoing demand for mobile connections (almost 20 million new lines are being activated each month): In most of India's circles, only three slots of 2.1GHz spectrum are up for grabs in the auction, while a handful of rural circles have a fourth slot. (See India Watch: The Road to 3G to check out what spectrum is being auctioned, and A Guide to India's Telecom Market to find out about India's circles.)
With so many bidders, and at least five operators (Bharti, Reliance, Vodafone Essar, Tata Teleservices, and Etisalat DB) seeking a pan-India license covering all 22 circles (service areas), fierce bidding is expected. According to industry sources, although the reserve price for a pan-Indian license is 35 billion Indian Rupees (US$769 million), bids of more than $1 billion might be required to win slots in the 2.1GHz band countrywide.
Not all of India's mobile operators are applying for 3G spectrum, though.
In line with its strategy to focus more on developing its current voice services, new entrant Uninor , which has signed up a few million subscribers since it launched in December 2009, has not applied. (See Interview: Rajiv Bawa, EVP Corporate Affairs, Uninor and Uninor Launches in India.)
Another relative newcomer, CDMA operator Sistema Shyam TeleServices Ltd. (MTS India), has also decided not to take part in the auction. Loop Telecom Pvt. Ltd. , a mobile operator with 2.7 million customers in Mumbai, has also stayed away from the auction process.
State-owned carriers Bharat Sanchar Nigam Ltd. (BSNL) and Mahanagar Telephone Nigam Ltd. (MTNL) don't need to participate in the auction process as they already have their 3G spectrum and will be awarded BWA airwaves, too.
BWA auction attracts multiple bidders
As well as applying to take part in the 3G spectrum (2.1GHz) auction, Bharti Airtel, Reliance, Vodafone Essar, IDEA, and Aircel have put themselves forward for the BWA auction, suggesting that they view the 2.3GHz band as useful to deliver data services.
Other bidders for the BWA airwaves include Qualcomm Inc. (Nasdaq: QCOM), which stirred up the market this week with its application, enterprise and wholesale communications giant Tata Communications Ltd. (NYSE: TCL) (sister company to Tata Teleservices), and a number of ISPs. (See table below.)

Table 2: Applicants for India's BWA (Broadband Wireless Access) Spectrum Auction

Name (in alphabetical order)
   

Company type

Aircel Mobile operator

Augere (Mauritius)Wireless Internet service provider (WISP)

Bharti Airtel Mobile operator

Idea Cellular Mobile operator

Infotel Broadband Services Internet service provider (ISP)

Qualcomm Wireless technology vendor

Reliance WiMax WiMax division of Reliance Communications

Spice Internet ISP

Tata Communications Business communications service provider

Tikona Digital Networks WISP

Vodafone Essar Mobile operator

Source: India's Department of Telecom

The list means there are a number of potential technologies being considered for use in the 2.3GHz band. Qualcomm is pushing TD-LTE, while Augere, Tata Communications, and Reliance WiMax all lean towards WiMax. Tikona Digital Networks, meanwhile, uses Wi-Bro to deliver its services in large Indian cities such as Delhi, Mumbai, and Bangalore.
Tata Communications "plans to bid for [BWA] spectrum in all circles," the operator's senior vice president of corporate strategy, Srinivasa Addepalli, tells Light Reading Asia. "Tata Communications considers wireless to be the best option to rapidly increase broadband penetration in India. We will finalize our funding plans for the broadband business, including evaluating the option of a strategic investor, after the completion of the auction."

Spectrum Auction & Equipment Market Competition

With only days until the 3G spectrum auction begins (April 9), further details have emerged about which operators plan to bid for pan-India spectrum.
In the meantime, 2G is where all the current growth is, and Ericsson AB (Nasdaq: ERIC) has landed itself a $1.3 billion deal to help India's mobile market leader bolster its existing network and prepare for 3G. (See
Ericsson takes away major Airtel 3G deployment.)
Spectrum bid battle shapes up
India's Department of Telecommunications has pre-approved all of the companies that submitted applications to take part in April's 3G and BWA (broadband wireless access) spectrum auctions. (See Bids Flood In for India's Spectrum Auctions.)
And it's possible to tell from the pre-qualification data (specifically, the size of the upfront deposit) which of the hopefuls are planning to bid for pan-India spectrum -- that is, bid for spectrum across all of India's 22 "circles" (service areas).
In the 3G auction -- for spectrum in the 2.1GHz band -- six of the nine bidders have pan-India aspirations: Aircel Ltd. , Bharti Airtel Ltd. (Mumbai: BHARTIARTL), IDEA Cellular Ltd. , Reliance Communications Ltd. , Tata Teleservices Ltd. , and Vodafone Essar .
Etisalat DB Telecom, which is yet to launch its 2G services, is to bid in a majority, but not all, of the circles, while S Tel Pvt. Ltd. and Videocon Telecommunications are set to bid in a small number of select circles.
In the BWA auction -- for spectrum in the 2.3GHz band -- eight of the 11 pre-qualified firms are looking to pick up countrywide airwaves: Aircel, Bharti Airtel, Idea Cellular, Infotel Broadband Services, Qualcomm Inc. (Nasdaq: QCOM), Reliance Wimax, Tata Communications Ltd. (NYSE: TCL), and Vodafone Essar. (See Qualcomm Unveils LTE Plans for India.)
Internet service providers Augere (Mauritius), Spice Internet, and Tikona Digital Networks are set to bid in select circles.
Bharti puts big bucks into 2G
With its subscriber base at 124.6 million (end of February) and growing at nearly 3 million per month, Bharti Airtel is expanding its network, and preparing its infrastructure for the arrival of 3G (so it's confident of emerging from the auction with some spectrum in the bag!).
As part of those efforts, the carrier has awarded Ericsson a $1.3 billion contract to expand and upgrade its network in 15 circles. The Swedish giant will supply: radio access network (RAN) equipment to support GSM, GPRS, and EDGE connections; circuit and packet core equipment; microwave backhaul gear; and "intelligent network" systems to support pre-paid account provisioning, activation, and service management.
The vendor states that part of its job is to "ensure that Bharti Airtel's core and transport network is 3G-ready in order to reduce time to market and enable the fast rollout of 3G services at a later date." They all hope...
Ericsson may be an incumbent provider at Bharti, but it shows how competitive the traditional suppliers can be, even in the face of increasingly stiff competition from the Chinese duo of Huawei Technologies Co. Ltd. and ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763).