Paid for Media Exposure in India
Is there a paid media exposure? I had alluded to the same in one of my earlier posts on TechWhack. This article appears in Business Standard on VSNL; is there an IPO in the offing in the near future? It is usually seen that a buzz is created around a company before it declares its results or perhaps planning to raise capital from the market. Much as they want to declare in their own company fact sheets, it does not carry the same weight as it does by being reported in Media. There ought to be a disclosure at the end of the article in the newspaper, which says that no material benefit has been derived from reporting. I am not casting a slur on the journalist in question, but then everyone knows as to how they are under pressure to speak out glowing reviews for the company in question.
I am forced to copy and paste here; something that I have avoided all along. Yet, merely linking to the post does not really help. My comments appear in italics.
Shobhana Subramanian writes, “Once a monopoly player in international long distance (ILD) telephony, Videsh Sanchar Nigam (VSNL) is gearing up to be a contender across segments in the telecom space. It is a serious player in the bandwidth game, having acquired Tyco Global Network (TGN).”
If VSNL is really a long-term contender, why has it artificially jacked up prices? Bandwidth game? They would pander to the same BPO’s that have dotted the entire “silicon valley” of India. Much that I detest the spread of cyber collism, there is not much of an option here. What of the individual customers?
Further, on she writes, “VSNL’s focus is fast shifting from voice to value-added data services. It has forayed into the retail broadband arena where subscribers are estimated to touch 20 million by 2010.
Arguably one of the biggest jokes that they want to pull on. 20 million by next 5 years? Where do they have the “estimated figures” from? Nasscom who remains a bunch of monkeys swinging from trees and 5 star hotels? Value added data services? For home users? Are they crazy? They have not been able to deliver their promises; I wrote back on TechWhack on the same.
As I read on the article, Shobhana has to say this further, “Besides, VSNL has forayed into the retail broadband arena. Broadband subscribers are expected to number 20 million by 2010, according to TRAI (Telecom Regulatory Authority of India) estimates, and VSNL’s share is just about 13 per cent, presenting a big opportunity”
Well, so we finally know that it is TRAI who is confabulating on the millions; would there be riots sir, to get broadband? Given your own frustrated attempts to lower down the access rates, I am really wondering whether you ought to be there in the first place.
Herein lies the big problem. Media reports in such a way that the lies and damned lies sound as truth.
Further, down the article, Shobhana mentions that VSNL has entered South Africa as a second telecom operator. She further writes, “According to the management, “South Africa is a large, virgin market for telecom services and an opportunity for VSNL to leverage its expertise”.
If this is true, India remains a “virgin market too”. Have a look around you VSNL and you would realize that there is a lot more left to be done. Would you stop paying these poor hacks and concentrate on ramping up volumes instead? I mean, it is asinine that you do not have the will to get projects executed. That is what it appears from not responding to my emails I had sent. Many of them to the top heads.
Now this is interesting. Shobhana reveals in the write up that setting up wireless operations in South Africa are 13 times more expensive, still VSNL is hell bent on sinking it’s money there! In the recent TRAI survey, it was reported that Tata’s seriously need to ramp up their telecom venture despite the presence in 19 telecom circles!
Further, down the line, Tata’s do not have an altruistic motive. Shobhana writes, “SNO venture is a strategic fit, similar to the Tyco acquisition, and view the African venture as a long-term investment that could be offloaded at some point after a listing”
Well so much, we know. Would you offload Indian operations too given the fact that it is almost a black hole as far as your money is concerned? Wait and watch this space!
Finally the all-pervasive analysts. Much of them remains in the background; prefer not to reveal their names. See for yourself,” Analysts are recommending the stock because they believe that the changing business model could result in VSNL emerging a leading global telecommunications player”
Indeed, it is laughable. Better, be good at home than spread the wings! Could we see affordable broadband here sir? I mean it is surprising that you offer 128 kbps as broadband despite the disclaimer on your website. I know that it costs money to lay down the local loop; your energies could have been better spent on looking at alternative models for broadband delivery. Perhaps for starters, ramp up your metro Ethernet project and scale it up to other cities first. Get aggressive on dial up; you people own the gateways and the infrastructure. “Global player”?
Is VSNL calling it right?