TRAI wakes up to pass rules on Broadband and Telephony

TRAI seems to have discovered its powers all of a sudden. In the past 2 weeks, it has passed orders with far reaching consequences. The first and foremost is the broadband speeds. It said that anything less than 256 kbps is not broadband. We all knew about that one Sir! For almost a year there has been enough noise being made about the way, companies are cheating its customers. Sify was the earliest on the block and hence deserves a mention here. Sify Broadband totally distorted the concept of what Internet access should mean. In this regard, I feel sorry for the customers who had no other option except to sign up for something marginally better than dial up but all being disappointed with the offerings. The worst part is that there is no mechanism of redressal.

The other players in the “broadband” market were quick to distance itself from the offerings. However, companies like Airtel market their pathetic 128 kbps or less under the brand name as Airtel Broadband. I feel that this may be a major lacuna in enforcing the recent TRAI order. Well, as they say, it is easier to get away with almost anything in India.

Why is it that these people tend to restrict the offering to such pathetic levels? The major reason is that most of the users use it mainly for checking email or web surfing which don’t take in account the amount of bandwidth consumed. Tata’s have an unlimited account of 128 kbps which is over priced at Rs. 6000. Tata’s can easily lower this price offering and set the market on fire. However, high upstart costs mean that they want to suck out the money as fast as possible.

Given in this scenario, it is indeed laudable that TRAI finally acted. I believe that someone higher up might be reading these columns to make an effort to bring about a change. The second significant order that came in was regarding the Push to Talk telephony. This walkie-talkie style of conversation did not find many buyers and the companies offering the same, namely Hutch and Tata’s did not have the license for the same. Tata has claimed that they were offering it under their ISP license. How far it is true is not known since the law can be twisted to change its meaning totally. However, TRAI’s order assumes significance because it clamps down on the operators. I am sure that Hutch and Tata’s would make their lawyers busy now!

Another significant ruling that came in was the barring of the Fixed Wireless phones as “mobile phones”. These phones would now have to be clamped down in a particular place and not be used as they have been used as before. This is because they have landline tariffs and do not attract the same ADC as the mobile phones do. The familiar culprits are BSNL! They have done it again exposing the idiocies in regulation. I sincerely believe that these Fixed Wireless Phones were a Godsend opportunity for small businesses and individuals who did not have to depend on the all-powerful linemen or bribe them to get connections. Everyone knows about them but no action is taken against the erring employees. In this regard, it was easier for Reliance and Tata’s to scale up margins and hence profits. This decision by TRAI is much uncalled for indeed.

TRAI recently chastised Tata’s for the threat of national security. Now the heat of national security is shifting on to other operators. Tata’s have been accused of the same issue that Reliance had to face recently, namely changing the international caller id to local calls in order to avoid paying the ADC component. I had earlier mentioned about the foolhardiness of Tata’s to share the essential equipment with other players in the market. Network is the jugular for any operator. This way any grey market calls landing in India become extremely difficult to trace and hence a potential for breaching the national security exists. In order to cut down the costs and scale up rapidly Tata’s carried on board other operators without realizing the implications of their actions. In this matter, any action taken by TRAI is indeed appreciable. How they follow up on the same is another matter.

Last but not the least. TRAI, in a significant move called for a consultation paper on reducing the ADC charges further. Again, the usual suspects BSNL and MTNL cried foul about the supposed losses. It is another matter though that BSNL is supposed to fund the rural expansion accruing from its own resources. However, they applied for Universal Obligation Fund and were able to bag the contracts. More on that in a later post. Howsoever I may detest BSNL for its lousy services; it is the dark horse of Indian Telecom. It can do in broadband what it did in mobile phone services.

In a recent survey on the quality of services, most of the operators fell short of the prescribed norms. It is not surprising given the obsession to scale up customers by all means possible. A part of the advertising budget can clearly be earmarked for improving on the services or perhaps cut down on the fringe benefits of their marketing heads. I have no idea as to how everyone arrives at a consensus on NOT improving the customer satisfaction but think of gimmicks. Surely, there must be a whole department to come with “out of the box ideas”!

Let us wait and watch as to how things unfurl in the Indian Telecom market.

Discuss on: Sify Broadband, Tata Indicom, Airtel Broadband, Reliance Broadband, MTNL – BSNL Broadband, Dial Up, Others

This post was submitted by Dr. Abhishek Puri on the Broadband Blog on Techwhack.

Tags: Advertising, Airtel, Airtel Broadband, API, Broadband, BSNL, BSNL Broadband, DTH, Hutch, India, Internet, Landline, Mobile, mobile phones, MTNL, Opera, Reliance, Reliance Broadband, Tata, Tata Indicom, Telecommunications India, Telecommunications India, TRAI, Universal Obligation Fund, Wireless

Spreading Broadband in India

I came across an advertisement in a computer related industry magazine. Those people wish to get together and discuss ways and means to spread the broadband in India. Well, it would have been an honorable attempt if they would have involved the ordinary people like us. Every day passes by and I keep my hopes alive that one day I would have some kind of a decent way to access Internet. And every day I get a major disappointment. The people who are supposed to make this happen are not doing their job good enough. There is no urgency on their part to make this effective means to spread broadband at all! As I had earlier mentioned under the post, Eternal Wait for Decent Telecom, I am still waiting.

Coming to the conference part. What do you honestly expect from the same people who are involved in the Internet services? Assuming Sify’s representative is going to be present there. What would he/she have to show in the name of spread of broadband? When they had time, they did not do anything. Instead bastardized the whole concept of access. I am glad I never had Cable Internet running up to my home. Or else there would have been a competing website to this one!

Sitting in the air-conditioned plush offices, it is easier to dictate terms to the media and pour in money in advertising binges. I mean it is asinine to see gobs of money being wasted to allure new customers. Admittedly, everyone around me is frustrated. Fewer people have the will to fight and fewer still come on line to these forums. Hence, what you see here is just the tip of the iceberg.

Most of us are not really bothered to affect the changes. The total cost of ownership runs way beyond the installation charges and monthly charges. The incremental cost of running after your service provider and telephone calls do not get factored in. What of the wasted time? Who can quantify that to compensate you? The irony is that even after running around and having your services restored, there is no guarantee that it would not happen again.

The problem is deeper than what it appears to be. Traditionally in India, it is the educated elite that make decisions without realizing the ramifications of their actions. What rubs salt in my wounds is that when they claim that India is an IT superpower! It would have been easier to ignore them as inconsequential idiots if we had better options. The twist and turn of the events of the telecom policy and subsequent roll out has seen that a handful of operators remain on the scene. Therefore, time and again it becomes extremely important for us to make them realize that they cannot get away with the abuse of their monopolies.

Simple fact is that advance planning is needed to roll out the services in a particular area. This is based on the projected demand. Well, in the event of shortfall, this should be scaled up rapidly. If this fact isn’t clear to them, what is the need to hire fancy idiots as showpieces? It is better if all you could just sit dumb and pretty. My only grouse is that at times we need to interact with them, which is a major drain on my patience.

I am wondering what are they really going to discuss in the conference? Are they not dime and a dozen? This is the first instance that I have come across though. For obvious reasons I cannot declare the magazines name or else I would be accused of slander! Well, Microsoft is sponsoring the same. This again gets on my nerves. Why do need such corporate sponsors who abuse their monopolies?

In the event of anything substantial coming up (which I really doubt), how are they going to implement any ideas that crop up? Would these telecom operators really improve on their customer quality? Simple rule of the thumb is that it takes much more to acquire a new customer than to retain one. I have been extremely happy with Reliance over the past 1 year. They have lowered my telephone bill substantially and the best part is that they have expanded all across the country. The roaming rates are the lowest in the industry. Well, they do not have top of the world billing, but for one who uses his phone sparingly, is enough. I declare that I am not a spokesperson for Reliance and see it with extreme cynicism as they move towards establishing their prominence across the country. However, the fact remains that I am satisfied customer. Of course, I am doing this for them free of cost. A first persons account based on peer assumption about the quality of a product is far better than Sachin Tendulkar spreading his arms with a signature tune in the background.

Logic. Just like bandwidth, is a scarce resource. I really pray that people with intelligence, including the ability to use the same ought to get in the telecom industry. Conferences with highflying corporate sponsors achieve little. What is required is the urgency to make this all happen. If I were happy, then the posts would reflect my happiness too. Or else I d remain in the permanent gripe mode!

Discuss on: Sify Broadband, Tata Indicom, Airtel Broadband, Reliance Broadband, MTNL – BSNL Broadband, Dial Up, Others

This post was submitted by Dr. Abhishek Puri on the Broadband Blog on Techwhack.

Tags: Advertisement, Advertising, Airtel, Airtel Broadband, API, Broadband, Broadband in India, BSNL, BSNL Broadband, DTH, Idiots, India, Internet, Media, Microsoft, MTNL, Opera, Reliance, Reliance Broadband, Tata, Tata Indicom, Telecommunications India

Smaller Telecom Operators in India

In the complex telecom muddle, there are a few independent operators that have stood the test of time and branched out on their own. However, the biggest drawback is that I cannot comment on them because of simple reason that I have never ever used their services. Over the period of time, telecom policy was designed to give equal representation to anyone who could sign up for the licenses and collaborate with a foreign telecom company.

Most of the independent operators survived the hostile takeover bids in the name of consolidation, especially by Airtel. In fact, Airtel has consistently raised money and diluted its stake to be “aggressive”. All in the name of expansion and ramping up numbers. Independent operators like BPL and Spice have so far stood out.

Spice has a stake in Karnataka and Punjab. However faced with falling customer base, it decided to market its value added services with huge amount of advertising splash. The network remains pathetic and I would rate the customer care as below average. As for BPL, all I know is that they remain mired in family wrangles, the trouble spot between the son in law and father in law. It was recently featured in the mainstream media too. Interestingly, both of these operators have branched out in handset manufacture. Perhaps to offer low deals on new connections and keep the overheads low.

Idea remains a study of contrasts. Again, I have never used Idea ever. Yet I do know that Tata‘s have a stake in the same. This goes against the accepted grain of logic because Idea is pitted against Tata’s in the same circles trying for the pie of customers for GSM and CDMA.

There were some rumors in the market that Idea may be sold off to some independent operators or those having pan Indian presence. Possibly Hutch. Obviously, these remain exactly that-rumors. I have a feeling that Idea may be sold off to some kind of a consortium in the near future. A consortium, which can consist of Japanese players or Russian operators. Possibly European too. It is strange that despite the 74% FDI limit, there have not been many telecom companies lining up still. Last heard, NTT’s Docomo may enter the Indian market in a big way. This may mean that promised acceleration for the 3-G networks may be earlier than expected; the cut off date was about end of this year.

The fact is that most of the earlier starters had so far staked out in the cities and metros where they milked the consumers. Rural expansion is tricky, given the expected low costs of recovery and infrastructure risks. The other players so far limited to South India are Aircel promoted by the maverick investor Chinakannan Sivasankaran, who sold out his stake in the same. He had earlier invested in Dishnet to promote Internet through Digital Subscriber Line (DSL) and sold that to Tata, which has this under the brand name VSNL broadband. He is now promoting Dishnet Wireless in a big way. Arguably sniffed out an opportunity in North East, which is relatively under served, including parts of Uttar Pradesh. In what could be a money-spinner for him, is good for the customers since he promotes his ventures using a lot of hoopla. I am sure he is going to make huge amounts of profits for himself after he sells out. Interestingly he has opted for GSM. In any case, it would make much more sense to have 3-G networks ready since they can accommodate far number of subscribers in the same spectrum for voice calls.

Coming to the fixed line operators, Airtel has a sizeable customer base apart from BSNL. In fact, Airtel is spreading itself over the other circles, as it needs scale rapidly to make profits. The primary reason is that it knows that much of the future revenues would come from the data services. This is in contrast to HFCL Connect, which is currently localized to Punjab. However, the fact remains that it is on the verge of the sell out if the market rumors are to be believed. Their fixed line telephony is basically pathetic being let down by lousy services and CDMA is limited to a few cities only. Despite their claims, I do not have anything to recommend them about. Their DSL remains very costly. In fact, with just a download limit of 400 MB on DSL! This fact is generally not known to most of the people outside the state. I believe that recent advertising binge is surely for ramping up the customer base and they are eventually looking out to sell off to Airtel, possibly. They were in talks with Tata’s recently, most likely for their Internet division, which for some reason did not work out, and talks broke midway. These are again market rumors, which have not yet been confirmed. Yet they do give an indication for the way telecom market is moving across.

Do we need these smaller players? Well the answer is yes and no. Smaller players lack the marketing muscle of the bigger ones. They are encumbered to localized regions and cannot offer economies of scale. However, the smaller players can offer faster customer response times. Sadly, this fact has not really reflected as far as Connect is concerned. I have mailed and personally talked to the people in charge for extending the services to my area, which they consistently refuse to do so. I gave up in disgust. However, I was lucky enough to try out their Internet services. Given the paucity of customers, the access speeds are better in both dial up mode and the “broadband” services. Still the Internet access is way too expensive.

This more or less is the round up of the existing operators in India. It remains to be seen as to how they scale up to the challenges in the future.

Discuss on: Sify Broadband, Tata Indicom, Airtel Broadband, Reliance Broadband, MTNL – BSNL Broadband, Dial Up, Others

This post was submitted by Dr. Abhishek Puri on the Broadband Blog on Techwhack.

Tags: Advertising, Aircel, Airtel, Airtel Broadband, API, Broadband, BSNL, BSNL Broadband, CDMA, China, data services, GSM, Hutch, India, Internet, mainstream media, Media, MTNL, Opera, Reliance, Reliance Broadband, Spectrum, Tata, Tata Indicom, Telecommunications India, Value Added Services, VSNL, Wireless