The DoT while formulating the final Information Memorandum (IM) for 3G and BWA spectrum auction is considering to come out with an altogether new MVNO policy in the near future. The new MVNO policy will take into consideration both 2G as well as 3G spectrum said a DoT official.
“The MVNO policy will be notified soon and that the policy will be applicable for both 2G and 3G spectrum,” said a DoT official.
Earlier this year in February, the DoT had allowed MVNO to enter India. Pan-India licence fee was fixed at Rs 85 crore.
But there might be some changes now in wake of allowing MVNO for 3G domain as well.
TRAI had some major difference of opinion with DoT over the number of MVNOs to be allowed per operator. TRAI was strongly in favour of allowing only one MVNO per operator. But the DoT was against this move.
Tuesday, September 29, 2009
Malaysia's Maxis eyes listing by mid-Nov-sources : Will this give us a inisght into the expected valuations?
KUALA LUMPUR, Sept 29 (Reuters) - Malaysia's top telecom firm Maxis Communications Bhd is expected to complete the IPO of its Malaysian operations by mid-November as competition heats up for Asian share listings, two sources with knowledge of the deal siad Tuesday.
Maxis plans to kick start investor roadshows for the share sale by early next month and book building for institutional offering by November 9, said sources -- a fund manager invited to the roadshow and a dealer involved in the sale.
The listing of Maxis Bhd, which will house the Malaysian mobile business, is likely to take place by mid-November, said the sources, who were not authorised to talk to media about the issue. A Maxis spokeswoman said: 'We will make an announcement at the appropriate time.'
Malaysia's largest mobile network operator by market share earlier this month said it plans to offer 2.25 billion shares or 30 percent of its existing share capital in the IPO.
The offering comes about two years after Maxis was taken private by its reclusive Malaysian billionaire owner, Ananda Krishnan, who owns telecom assets in India and Indonesia.
Of the 2.25 billion shares, 27.7 percent will be offered to institutional investors and the remaining to retail investors, according to a draft prospects posted on the market regulator's website on Sept. 18.
Maxis said the relisting would enable the company to access the equity capital market as it pursues growth opportunities.
It did not provide any terms or price of the share offer, but two sources told Reuters in August the IPO would raise $2 billion.
CIMB, Credit Suisse ( CS - news - people ) and Goldman Sachs ( GS - news - people ) are joint book-runners for the share offer, according to the draft prospectus.
Asia's IPO market is recovering strongly as economies bounce back from the global economic downturn and equity markets improve. In Hong Kong alone, there will be at least 21 IPOs raising as much as $25 billion by the end of the year.
In China, the first set of ten IPOs on the country's planned Nasdaq-style second board will freeze a combined 784.1 billion yuan ($115 billion) in funds for subscriptions.
Shyam Telecom Scrip hitting circuits !
Shyam Telecom Ltd, the company from which SSTL was demerged has hit the 10 pct circuit at 86.10 on the National Stock Exchange of India on news of Delhi Launch of MTS brand by Diwali.
Though Shyam Telecom has no holding in SSTL, a rub off effect has been seen in the markets.
Though Shyam Telecom has no holding in SSTL, a rub off effect has been seen in the markets.
3G spectrum winners will also be allowed 2G entry
29 Sep 2009, 0223 hrs IST, Joji Thomas Philip, ET Bureau
The Information Memorandum (IM), set to be released to potential bidders in a couple of days, says new entrants that successfully bid for 3G frequencies will also be eligible for 2G spectrum, used by the current crop of mobile service providers in the country.
The document, which contains details of the 3G auctions scheduled for December 7, however, says the allocation of second generation airwaves will be ‘subject to availability.’ ET has accessed a copy of the document.
The 3G spectrum is essential for offering value-added services such as video conferencing and ultra-fast internet on mobiles, interactive gaming and high-speed downloads. Currently, only state-run telcos BSNL and MTNL offer 3G services in the country.
Global telecom companies, which do not have a presence in India, have so far maintained that they would not enter the 3G race here unless they are allowed to offer full-fledged mobile services.
But this concession may not ensure the participation of foreign telcos. “We will require more information on the terms of the licence and clarity on clauses such as ‘subject to availability’,” an executive with an international telco said.
The telecom department (DoT) can allot fresh 2G spectrum in many circles, only if the defence forces vacate the same and existing operators are already waiting for fresh allotments, he said, requesting anonymity.
There are over 300 2G applications pending and foreign telcos do not stand a chance if they are asked to join the queue, he added. So far, 2G spectrum has been given to all existing telecom operators for free, based on them meeting certain pre-defined subscriber numbers.
The document also says DoT has asked the finance ministry to extend tax soaps to successful 3G bidders. Permission has also been sought to allow telcos and internet service providers to raise funds for WiMAX auctions through the external commercial borrowings (ECB) route. Earlier this year, the Reserve Bank of India (RBI) had allowed telcos to raise up to $500 million through ECBs for 3G auctions.
Last month, a ministerial panel had broken the deadlock over the reserve price for 3G spectrum, fixing it at Rs 3,500 crore. The minimum bid amount for WiMAX (mobile broadband) was set at Rs 1,750 crore.
The government had clarified in its 3G policy that international telcos, which do not have operations in India, can participate in the upcoming 3G auctions, while adding that successful players would have to acquire a telecom licence (also called unified access service licence or UASL) before they can begin operations.
A UASL in India comes bundled with 4.4 MHz of start-up 2G spectrum. DoT has, so far, failed to clarify if international operators that win 3G spectrum will be given this 2G startup spectrum when they obtain the UASL.
As per the country’s 3G policy, successful bidders will get 5 MHz of third generation airwaves. While this may not be enough for a new player entering the telecom market as it will require additional start-up spectrum, it will be enough for existing GSM players to migrate to 3G.
The DoT also has asked the finance ministry to treat the 3G operator’s licence fee as expenses over a 20-year period, the document says. This implies, telcos can deduct this amount in 20 equal annual installments from their profits and pay taxes only on the remaining sum, considerably reducing their tax outgo.
Telcos should deposit an earnest money of Rs 505 crore to participate in the 3G auctions on a pan-India basis. The new entrants, which will provide only 3G services, must share 3% of their annual revenues with the government as spectrum usage fee while incumbent operators entering the 3G space will have to share an additional 1% of their revenue for using the airwaves.
Telcos such as Bharti Airtel, Vodafone Essar and Idea Cellular, which currently pay 2-6% of their annual revenues as spectrum user charge depending on the amount of radio frequencies they hold and the area of operations, will have to share an additional 1% of their revenues, if they win 3G frequencies.
The document also says that MVNOs, service providers that do not own any cellular infrastructure, will be permitted in the 3G space too. UK-based Virgin and BT Mobile and Japan's KDDI have based their telecom strategy on the MVNO model.
How many telecom companies should India have?
Thomas K. Thomas
T. C. A. Srinivasa-Raghavan
What’s the similarity between Indian agriculture and Indian telecoms?
Simple: First, both have raised output to levels that no one would have thought possible when output boosting began (1969 for agriculture, 1996 for telecoms); second, relatively speaking, firms (farmers) have low start-up costs but high operating cost s; third, both have an extraordinarily high degree of competition (or, in economics jargon, producers are price takers in both sectors); fourth, both have a fairly high degree of flexibility in output mix; and, crucially, fifth, both compete for one scarce resource — land in the case of agriculture and spectrum in the case of telecoms.
Competition, key driverYet, no one talks of limiting entry into farming but when it comes to telecoms, serious thought is being given to capping the number of firms. This is despite the fact that the key driver of growth of telecom has been competition.
Post-2000, a substantial drop in tariffs and subsequent increase in the number of subscribers has happened each time new players entered the market.
For instance, the entry of CDMA players in 2003 doubled the mobile subscriber base to 33.60 million in 2004. Similar trends have been recorded with the entry of fourth cellular operators, BSNL/MTNL and, most recently, launch of GSM services by Tata DoCoMo, which introduced per second tariffs into the market.
Today, there are 10 players, of which two came in 2008 and two in 2009. At least three more are all set to launch their services by the end of this year. The full impact of new players will be felt next year as consumers will get lower prices (each mobile call now costs only 50 paise against the Rs 16 a decade ago and a handset as little as Rs 1000).
Output factorHowever, just as small pieces of land held by many farmers reduces agricultural output compared to the output from a large tract of land owned by a single farmer, dividing spectrum among 13-14 players has resulted in operators having an average of about 7 Mhz. In contrast the global norm is to give above 20 MHz per operator.
The lower availability of spectrum also means higher capex because more cell sites have to be put up and to increase spectrum re-use, leading to inter-site interference and resultant constraints on quality of service. In economics this is called a negative externality.
From this, it is easy to conclude that allowing more operators will only worsen the situation given that there is only limited bandwidth available in the frequency bands currently under use.
Unlimited competition could also make it financially difficult for everyone in the market as newer operators, desperate to get a share of a shrinking addressable market, will keep bringing down the tariff levels, which may not always be backed by a viable business case, leading to bankruptcy. We have seen this happen in the case of airlines.
Spectrum allocationHowever, easy but counter-productive solutions is what the Government excels in. It must, therefore, be resisted. There is another solution to the problem of scarce spectrum: Undertake spectrum reforms to identify newer bands. This is analogous to land reform to boost agricultural productivity.
Apart from getting the Defence Ministry to vacate some more spectrum in the frequency bands currently used for mobile services, standards should be developed for using new bands such as 700MHz and 450 MHz. To bring in more transparency in spectrum allocation, it should be auctioned so that everyone, new or old player, gets an equal chance to buy radio waves at market price.
Deploying newer technologies will also enable existing players to use spectrum more efficiently. If global operators got 20 MHz spectrum in the 1980s it was because the technology available in those days were bandwidth guzzlers. But the networks today are becoming smarter.
For example, 5 MHz bandwidth using third generation technologies can not only accommodate an existing player’s entire voice subscribers but also enable high speed data services. Even existing 2G operators who were grumbling about the lack of adequate spectrum have packed in double the number of subscribers through some innovative sharing of resources and better network planning. The question of whether the market has the appetite for more players should be answered by the market itself. If any player believes that there is room for more, then regulation should not stop it.
ContestabilityThe current thinking which is veering towards creating an oligopolistic market structure must be discouraged. Any number of studies have shown that in such market structures, it is not the number of incumbent players that is important but what William Baumol called the ‘contestability’ of a market.
Otherwise, collusive pricing and restrictive trade practices will always creep in. In a contestable market, entry is free and this is what keeps the incumbents from colluding. Is that what the Government wants?
MTS to launch high-speed internet services soon
New telecom licencee MTS, in which Sistema of Russia holds a majority stake, is preparing to launch high-speed wireless internet services that offer speeds of up to 3.1 mbps.
GSM operators have termed the services “legally untenable”, something MTS contests. The move will enable MTS (a brand owned by Sistema Shyam TeleServices Ltd) to join the league of major CDMA operators.
On a comparative basis, the services are 20 times faster than other wireless broadband connections and 10 times faster than average fixed line broadband connections in the country. When asked, Sistema Shyam TeleServices Ltd (SSTL) President and Chief Executive Officer Vsevolod Rozanov confirmed the development and said: “Yes, we are considering it.”
“Other CDMA operators have already launched the services and we don’t see why there should be an issue. Clearly, the data market is picking up. Though, a company cannot focus on data only, there needs to a sustainable business balancing both data and voice,” he added.
SSTL is a joint venture between Sistema of Russia (73.71 per cent) and the Shyam Group of India (23.79 per cent), with the remaining 2.5 per cent being publicly held.
The Cellular Operators’ Association of India (COAI) had earlier sought the Department of Telecommunications’ (DoT’s) intervention to stop these high-speed wireless internet services. COAI claimed these were 3G Evolution Value Data Optimised (EVDO) services. In its letter, COAI complained it was ‘legally untenable’ to permit select players to get a preferential headstart to offer 3G services.
MTS, which has operations across six circles, will complete a pan-India rollout by the end of next year. The company will roll out services in Delhi and the National Capital Region by Diwali (October), Karnataka in a month’s time and Mumbai, Maharashtra and Haryana by the end of this year.
The three major CDMA operators - Bharat Sanchar Nigam Ltd (3G EVDO card), Reliance Communications (Reliance Netconnect) and Tata Teleservices Ltd (Photon+) had earlier rolled out their services.
GSM operators have termed the services “legally untenable”, something MTS contests. The move will enable MTS (a brand owned by Sistema Shyam TeleServices Ltd) to join the league of major CDMA operators.
On a comparative basis, the services are 20 times faster than other wireless broadband connections and 10 times faster than average fixed line broadband connections in the country. When asked, Sistema Shyam TeleServices Ltd (SSTL) President and Chief Executive Officer Vsevolod Rozanov confirmed the development and said: “Yes, we are considering it.”
“Other CDMA operators have already launched the services and we don’t see why there should be an issue. Clearly, the data market is picking up. Though, a company cannot focus on data only, there needs to a sustainable business balancing both data and voice,” he added.
SSTL is a joint venture between Sistema of Russia (73.71 per cent) and the Shyam Group of India (23.79 per cent), with the remaining 2.5 per cent being publicly held.
The Cellular Operators’ Association of India (COAI) had earlier sought the Department of Telecommunications’ (DoT’s) intervention to stop these high-speed wireless internet services. COAI claimed these were 3G Evolution Value Data Optimised (EVDO) services. In its letter, COAI complained it was ‘legally untenable’ to permit select players to get a preferential headstart to offer 3G services.
MTS, which has operations across six circles, will complete a pan-India rollout by the end of next year. The company will roll out services in Delhi and the National Capital Region by Diwali (October), Karnataka in a month’s time and Mumbai, Maharashtra and Haryana by the end of this year.
The three major CDMA operators - Bharat Sanchar Nigam Ltd (3G EVDO card), Reliance Communications (Reliance Netconnect) and Tata Teleservices Ltd (Photon+) had earlier rolled out their services.
Sunday, September 27, 2009
China Telecom has offered 3G service using the US-developed CDMA2000 standard. We remain hopeful for the same technology to be used by SSTL here.
China's top 3 telecom operators invest 80 bln yuan in the first half
Source: Xinhua
[13:38 July 23 2009]
Comments
China's top three telecommunication operators, China Telecom, China Mobile and China Unicom, invested 80 billion yuan to boost the third-generation (3G) network so far this year, the Ministry of Industry and Information Technology said Wednesday.
China Mobile, the leading mobile network operator, has opened 3G service in 38 companies based on the domestically-developed TD-SCDMA 3G standard, and is expected to expand the service to 238 cities by the end of this year.
China Telecom has also offered 3G service using the US-developed CDMA2000 standard in 342 cities, while China Unicom has expanded its network based on Europe's WCDMA standards to 100 cities.
The top three operators have started trial 3G operation, which allows mobile phone users to download data faster, make video calls and watch TV shows.
The ministry expected the three operators would invest 170 billion yuan ($24.87 billion) in 3G network construction this year.
Source: Xinhua
[13:38 July 23 2009]
Comments
China's top three telecommunication operators, China Telecom, China Mobile and China Unicom, invested 80 billion yuan to boost the third-generation (3G) network so far this year, the Ministry of Industry and Information Technology said Wednesday.
China Mobile, the leading mobile network operator, has opened 3G service in 38 companies based on the domestically-developed TD-SCDMA 3G standard, and is expected to expand the service to 238 cities by the end of this year.
China Telecom has also offered 3G service using the US-developed CDMA2000 standard in 342 cities, while China Unicom has expanded its network based on Europe's WCDMA standards to 100 cities.
The top three operators have started trial 3G operation, which allows mobile phone users to download data faster, make video calls and watch TV shows.
The ministry expected the three operators would invest 170 billion yuan ($24.87 billion) in 3G network construction this year.
MTS Ranked in the World's 100 Most Powerful Brands With a Brand Value of $9.2 Billion
MTS Ranked in the World's 100 Most Powerful Brands With a Brand Value of $9.2BillionMOSCOW, April 28 /PRNewswire/ -- Mobile TeleSystems OJSC ("MTS" - NYSE:MBT), the largest mobile phone operator in Russia and the CIS, announced thatit has been named as one of the BRANDZ(TM) Top 100 Most Powerful Brands, aranking published by the Financial Times and Millward Brown, a leading globalmarket research and consulting firm. For the second year in a row, MTS joinsthe ranks of the most powerful brands in the world with a value of $9.2billion at the 71st position. As in 2008, MTS is the most valuable Russianbrand in the ranking and one of the 10 most valuable telecoms brands in theworld. MTS brand has risen 18 spots to become the 71st most powerful brandglobally with a value of $9.2 billion, up from $8.1 billion in 2008. Theunequivocal growth in brand value over the year is primarily due to theCompany's continued execution on its corporate strategy, strong growth andits leadership positions in the Russian and CIS markets. MTS launched its current brand in May 2006, building on its marketleadership and reputation as the highest quality operator in the region. MTShas built the largest network in the CIS and offers the widest coverage areain the region, providing its customers with consistent high-qualityexperience. With over 96 million subscribers, out of total population of 230million in the markets in which it operates, MTS has the largest mobilecustomer base in the CIS. Subscribers trust the MTS brand as it representshigh quality and offers the most innovative products. "Global recognition of our brand strength is a testament to both thesuccess of MTS and the growing interest in our markets of operation. Our risein the rankings is a strong indication that we are fulfilling our strategyand generating greater affinity for the MTS brand among our customers,"commented Mr. Mikhail Gerchuk, Vice President and Chief Commercial Officer ofMTS. "Given the sustained growth in our business and recent introduction ofthe MTS brand to India we are confident that the MTS brand will continue tostrengthen in the coming years." About Millward Brown's Ranking The BRANDZ Ranking is the only brand ranking based on primary research -it therefore reflects the perceptions of people who really count - brandusers and consumers. Derived from BRANDZ database, the world's largestrepository of brand equity data, the BRANDZ study has interviewed more thanone million consumers globally and covers 50,000 brands worldwide. The BRANDZRanking is the first study to cover both business and consumer brands and toinclude predictive metrics of future brand performance. Market performancemetrics and financial data were obtained from Datamonitor and Bloombergrespectively. Mobile TeleSystems OJSC ("MTS") is the largest mobile phone operator inRussia and the CIS. Together with its subsidiaries, the Company services over92.19 million subscribers. The regions of Russia, as well as Armenia,Belarus, Turkmenistan, Ukraine, and Uzbekistan, in which MTS and itsassociates and subsidiaries are licensed to provide GSM services, have atotal population of more than 230 million. Since June 2000, MTS' Level 3 ADRshave been listed on the New York Stock Exchange (ticker symbol MBT).Additional information about MTS can be found on MTS' website athttp://www.mtsgsm.com. Some of the information in this press release may contain projections orother forward-looking statements regarding future events or the futurefinancial performance of MTS, as defined in the safe harbor provisions of theU.S. Private Securities Litigation Reform Act of 1995. You can identifyforward looking statements by terms such as "expect," "believe,""anticipate," "estimate," "intend," "will," "could," "may" or "might," andthe negative of such terms or other similar expressions. We wish to cautionyou that these statements are only predictions and that actual events orresults may differ materially. We do not intend to update these statements toreflect events and circumstances occurring after the date hereof or toreflect the occurrence of unanticipated events. We refer you to the documentsMTS files from time to time with the U.S. Securities and Exchange Commission,specifically the Company's most recent Form 20-F. These documents contain andidentify important factors, including those contained in the sectioncaptioned "Risk Factors" that could cause the actual results to differmaterially from those contained in our projections or forward-lookingstatements, including, among others, potential fluctuations in quarterlyresults, our competitive environment, dependence on new service developmentand tariff structures, rapid technological and market change, acquisitionstrategy, risks associated with telecommunications infrastructure, risksassociated with operating in Russia and the CIS, volatility of stock price,financial risk management and future growth subject to risks. For further information, please contact: Mobile TeleSystems, Moscow Investor Relations Tel: +7-495-223-2025 E-mail: ir@mts.ru
Sistema Shyam TeleServices hits two million subscribers
Indian mobile network operator Sistema Shyam TeleServices, which operates under the MTS India banner, has announced that it has doubled its subscriber base in just over three months, reaching the two million sign-up mark this month. The cellco also claimed that it was the fast growing telecoms operator in terms of subscribers in August 2009, registering a growth rate of 16.8% according to figures produced by the Telecoms Regulatory Authority of India (TRAI); MTS was, in fact, the only CDMA or GSM operator to register a double-digit month-on-month growth in August . Commenting on the milestone, Vsevolod Rozanov, president and CEO of Sistema Shyam TeleServices, said: ‘Having started our operations in India in September 2008, and having launched the MTS brand in India only earlier this year, we are really excited at the fast pace at which we have been winning customer confidence in the country. We crossed the second million in less than half the time taken to reach the first one million.’ According to TeleGeography’s GlobalComms database, MTS India has launched commercial operations in five circles; Rajasthan, Kerala, Tamil Nadu, Calcutta, West Bengal and Bihar. The cellco has said it hopes to achieve a pan-India presence by the third quarter of 2010.
Sistema India telecom unit worth $3.5 bln -source
* Russia govt to buy 20 pct stake
* Fin min says hopes for deal before end-2009
(Adds finance minister comment)
MOSCOW, Sept 23 (Reuters) - Indian mobile telecoms group Sistema Shyam TeleServices, a unit of Russia's Sistema (SSAq.L), was valued at $3.5 billion by an independent appraiser, a source familiar with the valuation told Reuters on Wednesday.
The Russian government has allocated 23.7 billion roubles ($780.4 million) in its 2009 budget to buy a stake of around 20 percent in the company. [ID:nLI351079]
"Sistema Shyam is valued by (appraiser) Avers at around $3.5 billion," the source told Reuters on condition of anonymity.
Russian Finance Minister Alexei Kudrin said the government was completing the appraisal and the decision-making process regarding the acquisition of Shyam shares. "We hope that we will have time to make this deal this year," he told reporters.
The valuation would put a price of some $700 million on a 20 percent stake. Earlier Vedomosti business daily said the state may buy 20 percent of Sistema Shyam TeleServices for $680 million.
Sistema Shyam operates in six of India's 22 telecoms zones and has licences for the remainder. Sistema owns 73.71 percent in the company and India's Shyam Group has 23.79 percent.
Avers and Sistema both declined comment. (Reporting by Anastasia Teterevleva; Writing by Dmitry Sergeyev and Maria Kiselyova; Editing by David Holmes) ($1=30.37 Rouble)
* Fin min says hopes for deal before end-2009
(Adds finance minister comment)
MOSCOW, Sept 23 (Reuters) - Indian mobile telecoms group Sistema Shyam TeleServices, a unit of Russia's Sistema (SSAq.L), was valued at $3.5 billion by an independent appraiser, a source familiar with the valuation told Reuters on Wednesday.
The Russian government has allocated 23.7 billion roubles ($780.4 million) in its 2009 budget to buy a stake of around 20 percent in the company. [ID:nLI351079]
"Sistema Shyam is valued by (appraiser) Avers at around $3.5 billion," the source told Reuters on condition of anonymity.
Russian Finance Minister Alexei Kudrin said the government was completing the appraisal and the decision-making process regarding the acquisition of Shyam shares. "We hope that we will have time to make this deal this year," he told reporters.
The valuation would put a price of some $700 million on a 20 percent stake. Earlier Vedomosti business daily said the state may buy 20 percent of Sistema Shyam TeleServices for $680 million.
Sistema Shyam operates in six of India's 22 telecoms zones and has licences for the remainder. Sistema owns 73.71 percent in the company and India's Shyam Group has 23.79 percent.
Avers and Sistema both declined comment. (Reporting by Anastasia Teterevleva; Writing by Dmitry Sergeyev and Maria Kiselyova; Editing by David Holmes) ($1=30.37 Rouble)
Sistema Shyam in talks with IBM, TCS & Tech M for Rs 1, 800 cr IT deal
Sistema Shyam Teleservices (SSTL) is in talks with Tech Mahindra, IBM and TCS for a Rs 1,800 crore IT outsourcing deal that spans over a period of 10 years.
Sistema Shyam group offers mobile services under the 'MTS' brand in India. Sistema Shyam is the only CDMA player, among the new crop of telecom operators which prefer GSM technology over CDMA.
Rajeev Batra, CIO of SSTL said - “A final decision on the deal is expected to be taken by the year-end”. He confirmed that these three IT companies were in the reckoning for the contract, but did not confirm the value of the contract.
Essar Group led Aegis BPO will be looking after SSTL’s BPO operations and the proposed deal will not include the operator’s BPO operations in it.
Sistema Shyam which is going to launch its telephony services in Delhi next month will ask the companies to manage its IT systems across 22 telecom circles including Delhi. MTS also has plans to be a pan-India operator by the third quarter of next year.
IBM which built MTS its green data centres this year is also in the race.
Other telecom companies like Etisalat DB recently awarded the contract worth $400 million to Tech Mahindra, while Datacom’s IT infrastructure management has been awarded to IBM for about $200 million.
Unitech Wireless, in which Norway’s Telenor holds a controlling stake, has outsourced its IT infrastructure management to Wipro for about $500 million.
SSTL was among the nine new companies that were given licenses early past year to launch mobile services. So far, the company has launched CDMA-based services in six circles and has about two million customers in its network.
Apart from SSTL, a string of new players like Datacom, Loop, S Tel, Unitech Wireless and Swan are also in the process of rolling out nationwide services.tema Shyam Teleservices (SSTL) is in talks with Tech Mahindra, IBM and TCS for a Rs 1,800 crore IT outsourcing deal that spans over a period of 10 years.
Sistema Shyam group offers mobile services under the 'MTS' brand in India. Sistema Shyam is the only CDMA player, among the new crop of telecom operators which prefer GSM technology over CDMA.
Rajeev Batra, CIO of SSTL said - “A final decision on the deal is expected to be taken by the year-end”. He confirmed that these three IT companies were in the reckoning for the contract, but did not confirm the value of the contract.
Essar Group led Aegis BPO will be looking after SSTL’s BPO operations and the proposed deal will not include the operator’s BPO operations in it.
Sistema Shyam which is going to launch its telephony services in Delhi next month will ask the companies to manage its IT systems across 22 telecom circles including Delhi. MTS also has plans to be a pan-India operator by the third quarter of next year.
IBM which built MTS its green data centres this year is also in the race.
Other telecom companies like Etisalat DB recently awarded the contract worth $400 million to Tech Mahindra, while Datacom’s IT infrastructure management has been awarded to IBM for about $200 million.
Unitech Wireless, in which Norway’s Telenor holds a controlling stake, has outsourced its IT infrastructure management to Wipro for about $500 million.
SSTL was among the nine new companies that were given licenses early past year to launch mobile services. So far, the company has launched CDMA-based services in six circles and has about two million customers in its network.
Apart from SSTL, a string of new players like Datacom, Loop, S Tel, Unitech Wireless and Swan are also in the process of rolling out nationwide services.tema Shyam Teleservices (SSTL) is in talks with Tech Mahindra, IBM and TCS for a Rs 1,800 crore IT outsourcing deal that spans over a period of 10 years.
Saturday, April 11, 2009
Wednesday, March 18, 2009
Russia may acquire stake in Indian telecom firm: Report
Russia may acquire stake in Indian telecom firm: Report
18 Mar 2009, 1605 hrs IST, AGENCIES
MOSCOW: Russia's government is considering investing 680 million dollars (525 million euros) in an Indian telecom firm to help out the majority
Russian owner, a media report said here on Wednesday. Russia has set aside 23.7 billion rubles "for acquiring shares in the joint venture Shyam Telelink," now known as Sistema Shyam TeleServices, in its draft budget for 2009, the report said, citing a copy of the document. A source close to the deal told Kommersant the funds would go to buying a 20 per cent stake in Sistema Shyam TeleServices, which has licences to provide mobile phone services in 22 Indian regions and has over 500,000 subscribers. The Indian venture is already more than 73-per cent owned by Russia's Sistema group, which is controlled by billionaire Vladimir Yevtushenkov and also owns Russia's largest mobile phone operator, MTS. Under the agreement being considered, Sistema would retain a majority stake in the Indian venture and Russia would buy the shares as part of a plan to settle New Delhi's outstanding Soviet-era debt to Moscow, Kommersant said. The newspaper said Sistema would find it difficult to pursue its Indian expansion plans without extra support due to its hefty debt burden. Many big Russian companies have scaled back investment due to the global credit crunch.
18 Mar 2009, 1605 hrs IST, AGENCIES
MOSCOW: Russia's government is considering investing 680 million dollars (525 million euros) in an Indian telecom firm to help out the majority
Russian owner, a media report said here on Wednesday. Russia has set aside 23.7 billion rubles "for acquiring shares in the joint venture Shyam Telelink," now known as Sistema Shyam TeleServices, in its draft budget for 2009, the report said, citing a copy of the document. A source close to the deal told Kommersant the funds would go to buying a 20 per cent stake in Sistema Shyam TeleServices, which has licences to provide mobile phone services in 22 Indian regions and has over 500,000 subscribers. The Indian venture is already more than 73-per cent owned by Russia's Sistema group, which is controlled by billionaire Vladimir Yevtushenkov and also owns Russia's largest mobile phone operator, MTS. Under the agreement being considered, Sistema would retain a majority stake in the Indian venture and Russia would buy the shares as part of a plan to settle New Delhi's outstanding Soviet-era debt to Moscow, Kommersant said. The newspaper said Sistema would find it difficult to pursue its Indian expansion plans without extra support due to its hefty debt burden. Many big Russian companies have scaled back investment due to the global credit crunch.
Saturday, February 7, 2009
'Our rivals' customers are now moving to us'
Q&A: Vsevolod Rozanov, president and CEO, Sistema Shyam TeleServices
Surajeet Das Gupta & Ishita Russell / New Delhi February 06, 2009, 0:59 IST
Russian telecom major Sistema, which has a 74 per cent stake in a joint venture with Delhi-based Shyam Telelink, got an all-India Unified Access Service Licence (UASL) last year. It is the first among the new entrants to kick-off its services, with a launch in Rajasthan four months ago. Vsevolod Rozanov, president and CEO, Sistema Shyam TeleServices spoke to Surajeet Das Gupta and Ishita Russell about his strategy to become an all-India operator in 22 circles over the next eighteen months. Excerpts: What is your pan-India rollout time table?We launched our services in the Rajasthan circle last October, and already have more than 300,000 mobile subscribers — that’s around a tenth of the net additions. About 60 per cent of our subscribers were using mobile services provided by our competitors, so it shows that our product quality is being appreciated. We will launch our mobile network in another six circles, including Tamil Nadu and Kerala by end of May, and we shall have a pan-India presence in another year and a half.
Given you’re entering a market which already has six well-established players, and there are six more waiting to make an entry, what kind of a market share are you looking at?That depends on the pace of the rollout. We’re looking at securing 10-15 million subscribers by the end of 18 months. We’ve taken into account the impact of number portability as well, but we haven’t seen too many markets where this has a big effect on subscriber numbers. Generally, people remain loyal to their service providers. We’re looking at a 8-10 per cent market share by 2012, by which time there will be 700 million mobile phone customers in the country.
So it helps to be one of the first among the new players?Absolutely. I understand 50-60 per cent of users never change their operators, so this gives us a good base to build on.
Reliance Communications, which has just launched its GSM service, is offering a connection for just Rs 25 and is throwing in another 10 minutes of free talk time every day, for the first 90 days. I don’t think this can be a sustainable long-term strategy. In any case, this has not affected our customer additions. Reliance launched its services in Rajasthan in January and our customer base in the same month rose by 5-10 per cent over December which is quite good. It is too early to study consumer trends, but I assume our segment of the market is different and they do not get attracted by the Rs 25 offer.
If another 350 million customers are to be added by 2012, and there are 12 competitors (six old and six new players) for it, the market for each of you will be quite small.Newcomers are not the only source of customers for us. The majority of customers that we are getting in Rajasthan are through churn. I don’t think that subscribers are looking at buying a CDMA or a GSM service per se — they’re asking for quality. We are also looking at why our competitors’ customers are dissatisfied, so that we can offer them a product without these problems. This will also help differentiate us from our competitors.
GSM phones have beaten CDMA ones in India as well as the world over. Have you made the wrong choice? Plus, if you’re banking on your rivals’ customers moving to you, they have GSM phones while you have CDMA ones. So, they have to buy your phones. Doesn’t that make the cost of entry too high?Mobile operators, who are offering CDMA, are going to continue to do that. They’re not going to switch to GSM. Second, the capex for a new CDMA network is around 25-30 per cent lower than that for a new GSM network. Third, customers who buy bundled handsets tend to be loyal. Our costs are not high — we have an entry level phone for just Rs 899, along with talk time.
How much will you save by leasing towers?We will build about 20 per cent of the towers on our own and lease the rest. The towers that you build are yours for life. It is a strategic dilemma, but our main interest is to roll out quickly. However this also means that while our capex will be lower, our operating costs will go up since we’ll have to pay rentals on towers.
Have you bought Chinese equipment to save costs or is it that some of the European players don’t want to sell their equipment to you as they already have long-term contracts with the incumbents? There are only three big vendors in the CDMA space. Basically there is ZTE, Huawei and Alcatel-Lucent. After having in-depth discussions with all of them, we selected two big Chinese vendors — ZTE and Huawei. With Alcatel-Lucent, there were some financing issues.
What about the mobile phones?Our phones are mainly from China and Korea; we look at value-addition and not at low-quality products. It is reasonable to expect that a majority of the customers will not be the high-end variety, so we are currently working with Huawei and ZTE. For high-end phones, we’re working with Samsung.
By when can we expect SIM card-based CDMA phones in the Indian market?We will definitely see them in the near future. The question is when. There are some phones of Samsung and Nokia that are already available.
Why are CDMA-operators hesitant to opt for SIM-based phones? Is it the cost or does bundling the phone along with the connection and airtime help you avoid churn? There are historical reasons for this. For example, in Russia there is no subsidy for CDMA hand phones — the CDMA is a very high-end niche product only for high-speed data and good-quality voice. It has a small market but at the same time it has very high average revenues per user (Arpu). But in India, CDMA is around a fourth of the market, and bundling has been the norm here.
http://www.business-standard.com/india/news/our-rivals-customersnow-moving-to-us/00/06/348120/
Surajeet Das Gupta & Ishita Russell / New Delhi February 06, 2009, 0:59 IST
Russian telecom major Sistema, which has a 74 per cent stake in a joint venture with Delhi-based Shyam Telelink, got an all-India Unified Access Service Licence (UASL) last year. It is the first among the new entrants to kick-off its services, with a launch in Rajasthan four months ago. Vsevolod Rozanov, president and CEO, Sistema Shyam TeleServices spoke to Surajeet Das Gupta and Ishita Russell about his strategy to become an all-India operator in 22 circles over the next eighteen months. Excerpts: What is your pan-India rollout time table?We launched our services in the Rajasthan circle last October, and already have more than 300,000 mobile subscribers — that’s around a tenth of the net additions. About 60 per cent of our subscribers were using mobile services provided by our competitors, so it shows that our product quality is being appreciated. We will launch our mobile network in another six circles, including Tamil Nadu and Kerala by end of May, and we shall have a pan-India presence in another year and a half.
Given you’re entering a market which already has six well-established players, and there are six more waiting to make an entry, what kind of a market share are you looking at?That depends on the pace of the rollout. We’re looking at securing 10-15 million subscribers by the end of 18 months. We’ve taken into account the impact of number portability as well, but we haven’t seen too many markets where this has a big effect on subscriber numbers. Generally, people remain loyal to their service providers. We’re looking at a 8-10 per cent market share by 2012, by which time there will be 700 million mobile phone customers in the country.
So it helps to be one of the first among the new players?Absolutely. I understand 50-60 per cent of users never change their operators, so this gives us a good base to build on.
Reliance Communications, which has just launched its GSM service, is offering a connection for just Rs 25 and is throwing in another 10 minutes of free talk time every day, for the first 90 days. I don’t think this can be a sustainable long-term strategy. In any case, this has not affected our customer additions. Reliance launched its services in Rajasthan in January and our customer base in the same month rose by 5-10 per cent over December which is quite good. It is too early to study consumer trends, but I assume our segment of the market is different and they do not get attracted by the Rs 25 offer.
If another 350 million customers are to be added by 2012, and there are 12 competitors (six old and six new players) for it, the market for each of you will be quite small.Newcomers are not the only source of customers for us. The majority of customers that we are getting in Rajasthan are through churn. I don’t think that subscribers are looking at buying a CDMA or a GSM service per se — they’re asking for quality. We are also looking at why our competitors’ customers are dissatisfied, so that we can offer them a product without these problems. This will also help differentiate us from our competitors.
GSM phones have beaten CDMA ones in India as well as the world over. Have you made the wrong choice? Plus, if you’re banking on your rivals’ customers moving to you, they have GSM phones while you have CDMA ones. So, they have to buy your phones. Doesn’t that make the cost of entry too high?Mobile operators, who are offering CDMA, are going to continue to do that. They’re not going to switch to GSM. Second, the capex for a new CDMA network is around 25-30 per cent lower than that for a new GSM network. Third, customers who buy bundled handsets tend to be loyal. Our costs are not high — we have an entry level phone for just Rs 899, along with talk time.
How much will you save by leasing towers?We will build about 20 per cent of the towers on our own and lease the rest. The towers that you build are yours for life. It is a strategic dilemma, but our main interest is to roll out quickly. However this also means that while our capex will be lower, our operating costs will go up since we’ll have to pay rentals on towers.
Have you bought Chinese equipment to save costs or is it that some of the European players don’t want to sell their equipment to you as they already have long-term contracts with the incumbents? There are only three big vendors in the CDMA space. Basically there is ZTE, Huawei and Alcatel-Lucent. After having in-depth discussions with all of them, we selected two big Chinese vendors — ZTE and Huawei. With Alcatel-Lucent, there were some financing issues.
What about the mobile phones?Our phones are mainly from China and Korea; we look at value-addition and not at low-quality products. It is reasonable to expect that a majority of the customers will not be the high-end variety, so we are currently working with Huawei and ZTE. For high-end phones, we’re working with Samsung.
By when can we expect SIM card-based CDMA phones in the Indian market?We will definitely see them in the near future. The question is when. There are some phones of Samsung and Nokia that are already available.
Why are CDMA-operators hesitant to opt for SIM-based phones? Is it the cost or does bundling the phone along with the connection and airtime help you avoid churn? There are historical reasons for this. For example, in Russia there is no subsidy for CDMA hand phones — the CDMA is a very high-end niche product only for high-speed data and good-quality voice. It has a small market but at the same time it has very high average revenues per user (Arpu). But in India, CDMA is around a fourth of the market, and bundling has been the norm here.
http://www.business-standard.com/india/news/our-rivals-customersnow-moving-to-us/00/06/348120/
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