Assorted articles and Information

Telecom PSUs BSNL and MTNL lost about 46 lakh landline connections in 2007-08, Rajya Sabha was informed on 17th April. While 43.8 lakh BSNL lines were surrendered in the year, its sister concern MTNL lost 2.1 lakh connections, Mr Jyotiraditya Scindia, Minister of State for Communications and IT told the Upper House in a written reply.

The minister said the reasons for withdrawal of landline connections includes preference for mobile phones, move to private operator, disconnections due to non-payment of dues and surrendering of second telephone taken for getting internet connection due to availability of broadband. The total number of landlines in the country as on March 2008 is 3.9 crore, which was 4 crore in March 2007. At present, BSNL has 3.1 crore-landline users while MTNL has 36.8 lakh users.

ADA Group company Reliance Communications (RCom) is planning to set up WiMax networks across 50 countries in the next three years to move into the global telecommunication market. To get a headstart, the telecom major is planning to acquire a European WiMax operator in a $300-400 million (Rs 1,200-1,600 crore) deal. The worldwide interoperability for microwave access (WiMax) is a telecommunications technology that provides wireless data over long distances in a variety of ways. RCom has set up WiMax networks in 18 cities in the country, where Tata Communications and state-owned Bharat Sanchar Nigam Ltd (BSNL) are the other major players.

According to sources close to the development, the Anil Ambani group company is close to acquiring a company in Europe that has WiMax licences for over 20 countries across Eastern Europe, Africa and Latin America. The name of the company could not be ascertained. But merchant banking sources said that the acquisition would be in the range of $300-400 million.

The acquisition of the European company will enable RCom set up fresh WiMax network in these countries and scale up the existing network. The Indian company will have to make additional investments in these countries. This would be company’s second acquisition in the WiMax space. In February, the company had acquired a significant stake in a French WiMax chip manufacturer Sequans Communications. The financial details of the acquisition were not disclosed. Further, RCom will expand its reach across countries in the Saarc region, Mediterranean and other South African nations.

However, sources added that the move was part of RCom’s `Vision 2012’. The company intends to use undersea cables and WiMax-enabled last mile access in a similar number of geographies. RCom intends to provide high-speed broadband services, voice, video and data suite and 4G services, after making inroads into the global market. The company intends to connect over 2.5 billion individuals over WiMax networks.

Mobile operators are likely to fiercely oppose the government’s move to allow only two private operators apart from BSNL/MTNL in the 3G space. On March 29, ToI reported the Telecom Commission’ (TC) intent to allow through an auction, only three operators in 3G, with an initial allocation of 10 MHz spectrum each rather than six operators with 5 MHz spectrum each. It further proposes that one of these three operators should be state-owned BSNL/MTNL, which will be required to match the highest bid placed by private operators when the auction occurs.

This development leaves at least four of the existing six operators and nearly all of the new operators without 3G spectrum, a fearful thought for companies whose valuation and growth is acutely linked to the availability of spectrum in 2G and migration to 3G.

Some of the largest operators spoke to ToI on conditions of anonymity. “The government’s 3G proposal is both flawed and totally inconsistent with its policy of open competition in the 2G arena. How can the country have upto 12 operators per circle in 2G and merely 3 operators in 3G?” they say. 5 MHz of 3G spectrum for six operators is the way to go. Even in Europe, most 3G operators did not use even 5 MHz for the longest period of time,says another players. Experts feel that a combination of 7 MHz-10 MHz in 2G with 5 MHz in 3G would be an ideal and in fact, potent combination for many operators.

Ironically, the 3G proposals in their present form carries the potential of bringing together warring parties like Vodafone, Idea and Bharti, who could join hands with Reliance, Tatas and some of the new entrants to lobby for more slots (5 MHz) than fewer (10 MHz) as is currently proposed. This is critical for them as the uncertainty over 3G spectrum forces a serious and potentially crippling review of company valuations, at least till the final winners are declared. Interestingly, the GSM association is yet to take a public stance on the TC’s latest proposal.

India’s BSNL (Bharat Sanchar Nigam Ltd.) awarded a GSM expansion contract valued at over US$100 million to Canada-based telecommunications solution provider Nortel Networks on 25th March,2008. BSNL, which currently serves 20 million cellular subscribers, is actively growing its network reach and capacity to meet increased demand for mobile telephony services across the country. This project focuses on southern areas of the country. Deployment is underway and completion is expected in 2008.

BSNL has selected Nortel to support its southern Global System for Mobile Communications (GSM) network expansion with a very aggressive roll-out schedule, Nortel said in a statement. With this selection, BSNL can build on and maximise its existing network investment and rapidly extend mobile services to new subscribers, it added. BSNL, with over 20 million cellular subscribers, is actively growing its network reach and capacity to meet increased demand for mobile telephony services across the country. From 2004,Nortel has worked closely with BSNL in rolling out mobile services to some seven million customers in the southern and eastern parts of India.

Richard Lowe, Nortel President (Carrier Networks) said that India represents an enormous opportunity for Nortel in the carrier space, with its consistently high growth rates and increasingly mobile population. And we have redesigned our GSM portfolio with this kind of opportunity in mind, making our solution much more cost competitive, without compromising the performance, capacity and coverage, he added.

A study by the Global Wi-Fi Alliance has predicted that the Wi-Fi market in India will grow to $891million in four years. The adoption of Wi-Fi, which enables people to access the Internet without cables, would ride piggyback on the infrastructure and retail boom in the country, according to the study. Around 95 per cent of the laptops being sold in India at present are Wi-Fi enabled. The study also notes a steady increase in the sales of mobile handsets with Wi-Fi capability. This is another factor which would increase Wi-Fi adoption.

Other factors that will ignite Wi-Fi in India include large-scale developments of hotspots by corporates, telcos and PSUs. For instance, the Indian Railways recently announced that all important rail-routes between metros would be made Wi-Fi-enabled together with 50 railway stations (20 of which to be completed by March, 2008). Tata Communications, which has already rolled out rolled out 350 plus public hotspot locations is set to increase the chain to about 1,000 this year in 2008. Similarly, BSNL is setting up 100,000 Community Service Centres which will be carrying a powerful info kiosk that has Internet connectivity, plans to make a significant number of these Wi-Fi enabled.

While new technology solutions (PON, WiMAX, ADSL) will continue to address growing demand for broadband in India, Wi-Fi will continue to play a strong role in sub-tending the last mile to multiple end-points - slashing costs, improving inventory management in organized retail, enabling faster check-ins at airport counters, medical services in rural India, creating jobs in a rural BPOs, spreading education in hinterlands of India and enriching quality of life for many, the Wi-Fi Alliance study adds.

The study forecasts that by 2011-2012, the market for Wi-Fi networking gear and services (excluding laptops, handsets, and chipsets) in India will top $891 million, marking a 36 per cent compound annual growth rate from 2008. With real estate development exceeding 30 per cent annual growth, deployment of Wi-Fi networks in new residential, retail and corporate construction is cited as a key opportunity for Wi-Fi device manufacturers and service providers. The report profiles the work of a non-profit organization, Byrraju Foundation, which leverages Wi-Fi technology to connect rural farmers to experts in agriculture, remote patients to doctors, and young villagers to training and employment opportunities.