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TRAI plans stringent norms on reporting of cell subscriber base

July 5 : THE Telecom Regulatory Authority of India proposes to introduce stringent norms for reporting of subscriber figures by cellular companies.  The TRAI move, aimed at checking inflated growth numbers, is likely to have an impact on the valuation of the mobile operators and the spectrum allocation policy of the Government. According to a note circulated among the mobile service providers, TRAI has directed them to exclude connections that have not generated revenues for more than 30 days. Most operators give a 90-day grace period to pre-paid card users before deleting the subscriber from the database.  The TRAI note has also said that post-paid subscribers who have been disconnected for non-payment of bills will also be considered as inactive users. Connections given to employees and business partners free of cost will also be kept out of the subscriber base for reporting purposes. The telecom regulator has said that SIM cards with dealers, distributors, and sales channel will not be included in the subscriber base. "Different operators are reporting the subscriber base using different methodologies. This leads to inflated numbers," said the TRAI note. The telecom regulator has sought the operators' comments on the proposed changes. "The objective of the exercise is to reduce the difference between the reported subscriber numbers and the active users so that a more realistic picture is available to all concerned." Most cellular operators, however, are against the suggested reporting norms. If the operators adhere to the TRAI norms, then there will be a dip in subscriber base by at least 5-6 per cent. This will have an impact on the valuation of the companies. That apart, the demand for additional spectrum by the operators will lose some steam. As per the Government policy, spectrum - the raw material for offering cellular service - is allocated based on subscriber numbers.

News Courtesy :The Hindu Businessline

Idea announces STD at 99 paise
JULY 04, 2005 : NEW DELHI: IDEA Cellular Ltd has launched for their existing and new Pre-paid customers of Delhi & NCR region a tariff of only 99 paise per minute for calls to any GSM mobiles except BSNL and MTNL, anywhere across the country. The offer is also applicable to all Idea Post-paid subscribers on the new Idea India plans. Commenting on this offering Mr. Rajendra Chourasia, circle head, Delhi NCR, IDEA Cellular Ltd. said, " Idea has always pioneered innovative tariffs in the country and has always taken a lead in delighting its customers through their innovative products and tariffs. This tariff of STD at 99 paisa is Idea’s next big tariff innovation after its highly successful Idea to Idea rate of 75 paisa per minute".  "This customer-centric approach has helped Idea to acquire and retain the customers at a pace much faster than the industry." Idea has introduced these new tariffs wef 6 th July, 2005 wherein all private GSM’s can be called for 99 paisa, local and STD, and Idea to local Idea at 75 paisa. Local SMS will cost Rs 1.00 from the earlier Rs 1.50, which is lower than most other operators, and all these at no daily deductions or additional rentals. New Idea Tariffs applicable wef 6 th July, 2005

News Courtesy :
The Economic Times

Tata Indicom unveils new tariff plans

June 29 : TATA Teleservices has announced a range of new post-paid mobile tariff plans. The nine new plans fall under three broad categories - normal rental plans, zero rental plans, and advanced rental plans, according to a release. The normal rental plans have been branded Do More 99, Do More 149, and so on, the Do More plans requiring no security deposit and offering up to 20 per cent savings over customers' previous bills. The Do More plans will not be charged rentals for call waiting and forwarding facilities. There are also unlimited free local/intra-circle calls to any Tata mobile and to any Tata fixed phone at 40 paise a minute for a nominal monthly rental depending on the plan chosen.

News Courtesy :The Hindu Businessline

STD is passť, now dial India locally

JUNE 15, 2005 : NEW DELHI: A single unified rate for telecom services is coming. For the subscriber this would mean affordable telephony without distinctions such as STD and local calls. According to experts, this would also lead to truly unified licences, treating the entire country as a single market, ending the present segmentation of the national markets into different circles. Union minister for telecommunications and information technology Dayanidhi Maran today said the telecom department was giving finishing touches to the National Telecom Policy 2005. "Soon there would be no distinction between STD and local calls. There would be uniform rates and a ‘OneIndia' approach," he told a press conference in New Delhi.  Asked if this meant a change in the licensing regime, Mr Maran said, "You read between the lines. Sanctity of licences would have to be maintained." He stressed that the UPA government would strive to have uniform rates across the country. Any call made within the country would be the same as calling within a state, he added. He said the new telecom policy would provide for wireless technologies like WiMax and more liberal voice over IP. Treating the entire country as a single market for telecom services would mean reworking the present licensing regime, in which long distance licence holders have exclusive rights to carry calls across state boundaries.  Further, there would be pressure to revise local call rates in rural areas upwards, as long distance calls would no longer be able to cross-subsidise local calls. Intra-state disparity in telephone tariffs has already been addressed by the government. The Department of   Telecommunications (DoT) recently announced that calls between Chennai and the rest of Tamil Nadu, Kolkata and the rest of West Bengal and Mumbai and the rest of Maharashtra and between western and eastern Uttar Pradesh would be treated as local calls.  Until then, calls between the three metros and their respective states and the two parts of Uttar Pradesh were long distance (STD) ones and the consumers had to pay for roaming. Under the new facility, calls from mobile-to-mobile and fixed-to-mobile have become local.   Mr Maran also said DoT was holding discussions with stakeholders — both CDMA and GSM players — on the matter of spectrum and 3G services. The Telecom Regulatory Authority of India (Trai) has favoured a zero entry fee, and == Tata has proposed a Rs 1,500 crore entry fee for 3G services.  The issue is whether 3G should be treated as a continuum of 2G and 2.5G services. Mr Maran told reporters that once there was clarity, the spectrum policy would be taken to the Cabinet. He, however, said operators should also make efforts to make optimum use of the available spectrum.
"Let them go out and put up more towers to make efficient use of the spectrum," he said. He also said DoT would issue guidelines on the increase in the foreign direct investment limit to 74% from 49% next week. The proposal would be sent to the Prime Minister’s Office, he added.  DoT has proposed that foreign holding of public sector banks and other banks be excluded in the 74% FDI limit and it be treated as domestic equity. The finance ministry is believed to have agreed to DoT's view.

News Courtesy :The Hindu Businessline

Phone bills can now be paid at local PCOs

June 14 2005 : KOLKATA : There is good news for BSNL telephone users. Previously bill paying used to be a headache with serpentine queues and irate telephone staff. Not anymore now. The subscribers will now be able to pay landline as well as cell phone bills in any PCO booth with BSNL connection. A decision to this effect was taken by the BSNL authorities in Delhi on last Friday. Giving information about this development, a spokesperson, on behalf of the organisation, said that the process would be initially implemented in Chennai and Kolkata. Then it will be extended to the other metros after assessing the success of the experiment. According to information available, PCO booths that have a monthly billing of Rs 5,000 will be given this facility. The booths should also have a computer. BSNL will provide the software necessary for accepting telephone bills. The spokesperson added, "The booth operator will be provided with a commission of Rs 15 on each and every bill. "Moreover, BSNL is also tying up with a few banks to make easy loans available for the booth operators if they want to buy a computer. The interest rate on the loans will be quite nominal. This will also save the subscriber the trouble of wasting time while paying the bills." Kolkata, at the moment, has 33,000 PCOs while the number is a little over 23,000 in Chennai. Approximately, 27 percent of the PCOs in both the cities earn about Rs 5,000 each. But then why did BSNL adopt this strategy? The spokesperson said, "This will also give the PCOs the motivation to increase their income. We are also hoping that this will increase BSNL's income. Even if 50 percent of the subscribers start making a couple of calls while paying the bills then we will generate a substantial income from the booths."

News Courtesy : New Indiapress

What is a telecom spectrum?

MAY 30, 2005 : Wireless communications make use of the radio portion of the electromagnetic spectrum. Simply put, telecom operators send and receive signals at various frequencies to enable communication. This radio spectrum contains only a limited number of frequencies. Signals can be sent on different frequencies all at the same time, however, if frequencies are the same or too close they can interfere with each other. As the number of frequencies is limited, they need to be allocated to different service providers. Therefore, spectrum is allocated for various communication purposes world-wide. Is spectrum being given free to telecom operators?   Contrary to popular perception, spectrum is not available for free. Currently, spectrum charge has two components — the entry fee charged is inclusive of one-time spectrum charge, and an annual spectrum charge based on a percentage of the Adjusted Gross Revenue (AGR) of the telecom company. The percentage of annual spectrum charges for GSM operators, for instance, varies with spectrum usage. Currently, the ceiling for annual spectrum charge is 6% of AGR. Trai, though, has recommended that the ceiling be lowered to 4%. Now, Trai’s recommendations only say that there will be no one-time spectrum charge for allocation of IMT-2000 spectrum (meant for 3G) for existing service providers. The regulator has explained that the allocation to the existing operators should be viewed as extension of 2G spectrum allocations. However, a contrary view is that spectrum is a scarce resource and that additional allocation should be priced. What are Trai’s spectrum recommendations all about? Trai set to work on spectrum-related issues following a letter from the government of India, which asked the regulator to make recommendations on efficient utilisation of spectrum, spectrum pricing and spectrum allocation procedure. The regulator also issued a consultation paper in May ’04 on spectrum-related matters. The recommendations that have come out recently are a result of the culmination of this entire process. On the issue of benchmarking for efficient use, Trai has said that benchmarking criterion is practically difficult to implement. On spectrum allocation, Trai has said that the existing spectrum allocation criterion for both GSM and CDMA operators needs to be reviewed so that additional spectrum allocations are made in a technology-neutral way. It has also been recommended that CDMA operators be provided additional spectrum in the 800-MHz, 450-MHz,  1,800-MHz and IMT 2,000-bands to meet short- and long-term needs of these operators. For GSM operators, additional spectrum in the 900-MHz, 1,800-MHz and IMT 2,000-bands has been recommended. Notably, the fear of GSM operators that allocation of frequency in the 1,900-MHz US PCS band to CDMA players would hit their 3G services has been addressed. CDMA players have not been offered this band as there was a clash between the uplink and downlink frequencies of the two technologies in these bands. On the issue of spectrum pricing, Trai has recommended that there be no one-time spectrum charges for allocation of IMT-2000 spectrum for existing service providers. The existing method of annual spectrum charge in terms of percentage of revenue should continue. What is 3G and does it need a different band to operate in? 3G refers to third-generation mobile networks. The current wireless networks, referred to as 2G, are essentially intended for voice services. Data transfers on these networks do happen but there are limitations. 3G, on the other hand, will enable networks to effectively handle voice, data, multi-media, internet etc. Both GSM and CDMA have their own versions of 3G. While GSM 3G is based on WCDMA (Wide Band Code Division Multiple Access), the CDMA 3G services are based on EVDO (Evolution Data Only). The International Mobile Telecommunications 2000 (IMT-2000) is the global standard for 3G services. It proposes a number of 3G systems operating through standard interfaces. Under the IMT 2000, all countries have agreed to use the same frequency band, referred to as the core band, for 3G services.

Why is there all this fuss about band allotment?

All the noise surrounding allotment of spectrum centres on, one, the need for more spectrum and secondly the timing of the launch of 3G services by both GSM and CDMA operators. Bands allotted are important because equipment to set up the telecom network and handsets for that band need to be available.

The primary contention of both GSM and CDMA players is that they should be allotted bands that enable them to deploy globally available equipment. Also, each of them is concerned that immediate allotment of spectrum to either party in the suitable band without providing enough spectrum to the other will disadvantage one set of players in the launch of 3G services.

News Courtesy : The Economic Times