Rising competition (13 licences for each circle), falling tariffs (lowest in the world, falling further because of per-second billing), rapidly declining average revenue per user (ARPU) because the newer subscribers are the low spenders in semi-urban and rural areas, and high taxes (about 30 per cent in all) ……….have put paid to the aspirations of not only the new entrants but also incumbents……..deleted.

Forget about fancy valuations. I have always contested the claim about the “lowest tariff in the world” because it is not in consonance with the actual “gini coefficient”; which means that we pay more than we can actually spend. It is a bitter truth but then the newspapers need a lifeline of their advertising spends, so rest assured, this truth will NEVER be out.

……Nearly 15 million more users came on board in September….. It has also brought into focus the phenomenon of dual SIMs — existing subscribers are acquiring additional connections, resulting in a seeming increase in subscribers but in fact merely leading to a bill being split between two or more service providers….Deleted.

For the first time, to my knowledge, a newspaper daily has mentioned this in black and white. Let me also repeat. The operators keep the discarded number for a period of atleast 3 months before it is “terminated”. So even though, a customer has left in the middle of month, the disconnection would not be reported for another 3 months (which, I believe is an industry practise). The same customer may acquire multiple connections or dual SIMS; so it is the growth of the SIM cards and perhaps not the customers which is reported. In any case, the simple headcount may not be feasible.

Industry executives blamed much of the ills on the government and the regulator. With falling tariffs, they need to cut costs, but their hands are tied because 35-40 per cent of their costs are taxes and other regulatory expenses. They have to pay 5 per cent of their revenue even from rural areas towards the universal service obligation fund which is meant to promote rural telephony. They said there was no need for the regulator to push for pay-per-second billing by all…… Deleted.

Now this is something that industry officials would always bleat about. Let them come out openly against the said “policies”…shadow fighting the Government wouldn’t help. For one simple reason. If these morons had any iota of service towards customers, I would have sympathized with them. But, they treat their customers like dirt; more so like crap cash cows who feeds in their kitties with little change so that likes of Mittal and his ilk can reap in obscene profits. In any case, let them prove their worth with their commitment to service, their willingness to be transparent, their approachability and customer care in the true sense of the term. People need their money’s worth but alas! My countrymen are basically lazy bastards who wish to have everything on platter without fighting for it.

…….the incumbents said they remain committed and focused on growth. “We will continue to enhance our market leadership and simultaneously open new revenue streams like m-commerce, m-entertainment, digital media and many other products……Deleted.

They have no real option but to focus on Value Added Services which is “babes, bikinis and bollywood”. Unless these people want to “focus” on phone sex services which would be a “high revenue earner” for them.

Rest of the write up seems to sum up the gloom and “brave words” just to reassure the shareholders that “we are up to it”. That we would weave our small little web of deceit, of lies and pull wool over the regulators and leave no stone unturned to defraud our customers because they are basically bunch of idiots and nincompoops. No one knows how much unaccounted for wealth flows in and out of system or whether this elaborate system allows them to launder their money in more effective way. There is no accountability to the customers because they are using a PUBLIC resource and merely by adding value to it doesn’t entitle them to the ownership of it.

Sadly, this isn’t mentioned anywhere. This of course, would be mentioned at all.

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Most of the telcos claim that they are running into losses since their account books are not open for public scrutiny. They resort to “shady deals and practises” to keep themselves afloat. No one knows their real valuations and the truth behind “window dressing”.

The strange thing, despite the “losses”, companies can afford to expand, go on an advertising spree and hire their “brand ambassadors”. No one knows for sure as to how much money exchanges hands.

Does that make a difference to you? Should you be concerned? The higher termination charges and the fact that companies have resisted all attempts to reduce the interconnect charges means that you continue to pay extremely high charges for all your calls. Clearly, value added services has added to their kitty but their practise of using differential tariffs for different markets has paid them rich dividends. They are slowly becoming monopolised and cartelised and even though you may think that you are the king, they suck you out of your money.

It’s high time these buggers need to be made accountable for the practises because the spectrum they use is clearly public property. They are just service providers and despite their claims of paying for the spectrun doesn’t give them the divine right to own it too. Plus, they owe thousands of crores to the Government (indirectly you and me) in terms of unpaid licencing money.

Scam. It’s a scam. It’s always been a scam.

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To me, it appears to be cynicism for all practical purposes. I feel that it would be more worthwhile to dig a deeper in this little “mystery”. Airtel’s shareholding is complex. 30% of the stake is owned by Singtel which in turn is owned by Temasek Holdings; part of Ministry of Finance of Singapore. They are state-run investment pools, known as sovereign-wealth funds and have have some $1.5-2.5 trillion to play with; little is known about them. For example, these holdings opened up their books for inspection only in 2005 and have opaque structures.

Why would Singapore be interested in getting a stake in an African Telecom major MTN Group of Johannesburg. MTN, which operates cellphone systems in Africa and the Middle East, could be worth more than $40 billion in its entirety. But then, telecom valuations are known to be inflated more than their worth.

I could not find any references to Temasek Holdings and it’s relation to Chinese. A big conglomerate of telecom operators can effectively bring the equipment suppliers on the table to negotiate a deal for themselves; not everyone is as smart as Reliance. I have no clue as to why Singapore would fund such glitzy takeovers and investments.

Hence, I would only recommend “cautious optimism” to the news of the takeover. Bharti faces competition from other operators as well.

Here is the complete story on NYT.

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Anti Monopoly watchdog MRTPC issued notices to Airtel , Vodafone and Idea Cellular regarding the price increase on the same day! Here is the frigging legal flotsam if you are interested:

The DGIR said this was a Restrictive Trade Practices by the operators as it distorted the competition and recommended to take action against the three operators under section 2(O) read with 33 (1)(D) of the MRTP Act, 1969.

It’s hard to imagine that any action would come out of this. The legal battery of these companies would swing into action and perhaps settle out of court. They would get a mild rap and it would be business as usual.

In the whole scenario, it is the suffering customer who would keep his mouth shut and not rise up and demand that the prices be rolled back and that they get paid back in kind. Sheesh. I have never come across such a mass of people who choose to suffer in silence and let the operators get away with open loot.

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