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The entire article can be viewed here; although I don’t wish to skip over the juiciest parts (and something that I have always mentioned in this blog that is patently wrong with the auctions and the way it has been handled).

On First Come First Served Basis:

The Committee note that the First-Come-First-Served (FCFS) basis for the issue of Licences and Allocation of Spectrum has been followed by the Department on the argument that the announced UASL guidelines have made it open for new licences to be issued on continuous basis. The Committee’s scrutiny of the records reveal that in the Basic Service Licences guidelines, there is a reference to FCFS but nowhere in the UASL guidelines, the term FCFS has found a mention implying thereby it has no sanctity. In fact, on 24th November, 2003, the then Minister of Communications and IT had approved the Department’s proposal to give licence Spectrum on FCFS basis, but it was not codified in the UASL guidelines. Thus, there has been no such legally established principle as ‘FCFS’, at best it can be termed as a prescription to be followed for grant of licence/Spectrum…….

On Role of Media:

The Committee note that the brazen irregularities in the allotment of 2G spectrum and UAS licences were unravelled by some investigative journalists much before the Radia tapes came into the public domain. A journalist who played a stellar role in exposing the irregularities, on being asked about the sources of his information, replied that the information was collected through the RTIs and from some public-spirited insiders…..

Presumptive Loss:

….Intriguingly, neither the DoT nor the TRAI has quantified the precise loss. Unfortunately, the DoT instead of admitting an unconscionable act, advanced the plea that theoretical exercises based on economic modeling are fraught with simplistic assumptions and that no methodology can be suggested by them to calculate the loss…..The Committee feel that giving dual technology licence to the CDMA operators and new UAS licences in 2007-08 at a price determined in 2001 was not only imprudent but also smacks of a design.

Shortcomings in the Implementation aspect:

….While the first phase was implemented, the second phase was conveniently and intentionally, as subsequent events substantiate, overlooked. In the process, devising an efficient allocation formula for Spectrum alongwith an appropriate price remained unachieved as delinking the price of Spectrum from the issue of licences was given a go bye, disregarding the Cabinet decision. The Committee are deeply distressed that due to violation of the Cabinet decision and as a consequence of such deliberate omission, the issue of UAS license and allocation of Spectrum in 2007-08 at the price discovered in 2001 caused a staggering, but wholly avoidable, revenue loss…..

The Committee also desire that the price of Spectrum be delinked from the issue of licences without further delay and seek explanations as to why this important decision has not been implemented as yet…..

Role and Responsibility of TRAI:

The Committee note that the recommendations of the Telecom Regulatory Authority of India (TRAI) are not binding upon the Central Government. But it is mandatory for the Government to seek recommendation of the TRAI in respect of matters pertaining to the need and timing for introduction of new service providers and terms and conditions of licence to a service provider. But the Committee are surprised to note that while seeking TRAI’s recommendation on 13 April, 2007 on various issues, the DoT did not seek recommendations on grant of new licences despite the mandatory requirement. Even though the decisions of the Government is final whether to accept or reject the TRAI’s recommendation, not seeking such recommendations at all speaks volumes for the DoTs malafide designs to circumvent the established provisions in the TRAI Act..

So now we know that TRAI basically is a useless toothless regulator.

But TRAI is not above all. So read the following:

Besides, the Committee find TRAI’s flip-flop in its recommendations also contributed towards the Department’s arbitrary and unilateral decisions. For example, in 2003 TRAI recommended that as the existing players have to improve the efficiency of utilization of Spectrum and if Government ensures availability of additional Spectrum, then within the existing licensing regime, they may introduce additional players through a multistage bidding process as was followed in the case of introduction of the fourth cellular operator.

The bad news:

One aspect that engages the attention of the Committee is the fact that worldwide, especially in the developed countries, the licensing and Spectrum related functions are actually performed by the Regulators and not by the Government unlike in India. The Committee consider such a practice as one of the main reasons for the DoT’s arbitrary decisions in dealing with the consultation process with the Authority.

The big players have engaged the Department of Telecom and the TRAI executives get exemplary post retirement benefits as fancy board members. Of course, they are there to liaise with the existing bureaucrats setting up huge questions on conflict of interests. I really don’t know whether these clauses are in built in their “rules” but if you look at the RTI applications to make their assets public, these faceless bastards need to be more accountable. Not all of them are like that but the blackest of the black sheep are bringing a huge shame to rest of the community.

Pathetic. Ours is totally a banana republic.

On 3G Spectrum (Which I personally feel has been “over-inflated”):

The Committee are happy to note that the auction of 3G Spectrum through an open and transparent bidding process has established the true value of the finite scare resource. However, as apprehension has been raised at many quarters that by paying such hefty amount to get 3G Spectrum, the successful bidders might pass on the burden to the consumers, the Committee impress upon the TRAI to keep a watch on the development in this regard and protect the interest of the consumer in tandem with the DoT.

Hope you are feeling bad enough by reading this sorry state of affairs.

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A little while back, Rajesh Jain had run a “Big Idea for India” contest. He has touched on many issues in his previous posts; there was a lack of serious debate on Broadband. This contest was open to all; I had mailed my entry to Rajesh on his email.
He had received over 150 responses for the same.

Jain announced the winners recently; in which yours truly has also figured (the names are in an random order). The contest was judged by Jain and Atanu Dey (whose blog is linked to in the blog roll in side bar). Of course, he has been a huge influence in shaping up my thought process and I owe a lot to him.

The post, in it’s entirety follows here. For the regular readers, there is nothing new because I have already touched on these issues in the previous posts extensively.

This is one answer and highly underrated option. The following scenario is envisaged:

1) Optic fibres running across to get the data without caps. We need fibre to home instead of outdated copper. Last mile access is contentious; while opening up last mile for private players is contentious, this needs to be debated. Britain has opened it up under strict regulations and British Telecom has been forced to upgrade it’s infrastructure to retain customers.

2) Heavy public investment for scalable architechture. Not 3G guzzling up spectrum but community Wifi’s (pay per use or perhap involving the municipalities making the people accountable directly for the level of involvement).

3) Create an ecosystem of open source applications to harness ideas; make it easier for people to access services. (Open Source standards promote interoperability; closed source is meant for perpetual profiteering at public’s expense).

4) Opening up the Government’s accumulated data through API’s etc; create models around it. For e.g., data from GPS installed in public transport would easily display the estimated arrival time through SMS if needed on the mobile phones. (“Hacker culture” is missing in India; most of the Bangalore flotsam is moronic army of debuggers and script kiddies).

5) Teleconferencing would make it easier for people to people contacts; Gujarat has shown the way! Why can’t India have something similar to Skype? (There is a move to have something similar in the GNU world where encryption would be based on open standards).

6) Education sector would get a boost; not only invite faculty, stream educational videos, hold tele-sessions but teach kids for a wonderful world of Internet. (Pilot experiments in Bihar/Gujarat have been well received; the idea needs scaling up).

7) Spin off benefits from e-commerce applications.

The potential is huge; if you are planning it to share with BJP, the easiest way out is to break the ISP‘s monopoly, hold TRAI responsible for execution (not DoT) and revise Broadband definition to at least 2 Mbps (UNLIMITED, WITHOUT any caps).

Thanks Rajesh!

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It’s unlikely “Swan” and “Loop Telecom” would ever be “penalized heavily”. Tata and Ambani, even though being summoned by PAC, would be asked to “pay up the damages”; some crores dealt here and there, permanent stock holdings to some prominent members and post retirement lollies as directors.

It transpires that Swan was a front for Reliance and Loop for Essar. Indeed, the idea was to bid for scarce spectrum, their holdings held in off shore accounts and laundered.

It is a dirty world indeed.

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I have these feelings that Indians have a “trap mentality”. They tend to whine, cry themselves hoarse and generally straighten themselves out in front of people who are deemed to be “charismatic”. In short, they lack self confidence.

Hence, for the past 15+ years, they have been roughshod by the telecom operators because as a collective mass, Indians are bunch of idiots. Exceptions to the rule always apply (the so called outliers in economic parlance) but by and large they would cower and roll on the ground. This ingrained slave mentality is exploited by smart people; those who rise above the scum so as to say. They become “leaders” (or politicians), media managers, CEO’s etc while rest of them become cogs in the system.

This background is essential because it is collective clusterfuck of assholism is the reason why these telecom companies have not been held ransom for better customer care. No wonder, they are content to outsource their core competencies to army of morons sitting on the switchboards. Neither there is dedicated institutional mechanism to hold them accountable. Given the huge volume of mail to TRAI (regulator), about “complaints” from the customers, they are unable to act on them. Or even if they wish to, the confusion about who the real boss really is sucks the whole issue into vortex. Would it be wise to leave let go of the regulation and leave the sector open to “market forces” hoping that competition would ensure correction?

Mobile Number Portability launched nationwide is a step perhaps in that direction. For the first time in years, I have a reason to cheer. And croon about optimism. It is not that the winds of change have started “flowing” in the system; rather a belated first step towards some degree of customer empowerment.

However, the low end customers paying a pittance would not really benefit. If you rake up huge bills on post paid, thats where it’s going to matter. The most. Seriously. No one wants to leave a cash cow; so thats where the its going to affect.

The impact of mobile number portability is going to be felt slowly over the months. Whether or not it affects you as a customer would be clear. For the time being, I am holding my cynicism back. For once.

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I quote the relevant text.

Text messages take up very little space — about 140 bytes, as they are being transmitted. That’s really why text messages are kept short. How much are we really paying for them? As much as $1,498 per megabyte. Here’s some of the math:

There are 1,048,576 bytes in a megabyte, so 7,490 text messages are transmitted in each one. The cellphone companies charge about 20 cents a text message, adding up to that $1,498 a megabyte. (And yes, you are charged that rate whether you write 160 characters or just “LOL.”)

That’s a huge margin indeed!!

It may be argued that the rates are not equivalent in dollar terms here. But I have always argued that the voice and the sms calls are way to expensive even after the companies have recovered their expenses. I have also argued that in real dollar terms we are a third world country where it takes less than a dollar to subsist. Companies are content in charging you upfront for the “service charge” of giving you the service and charge you each time you make a call. That’s fair on their part but unfair from a consumer’s point of view.

Here’s more.

But the unlimited plans, generally costing about $20, are only a relative bargain. The average texter sends about 500 text messages a month, according to Nielsen, the media measurement firm. That drops the price of a single text message to 4 cents, or to $300 a megabyte.

Nielsen says the average teenager sends 3,146 messages a month. Even at that volume — an average of about 104 texts a day — the phone company is extracting $47.62 a megabyte.

How far is it true in Indian context?

There is no fancy metric here in India and I distrust the crap being dished out by many self styled firms. It remains high on crap without making any sense.

Still, the very thought is chilling. Really.

With minor modifications, companies are making a HUGE killing. No wonder it is such a profitable business, never mind the huge bloated flotsam claiming that it is a hugely competitive market.

Bullshit.

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TRAI releases it’s numbers from the industry proclamations; it has not thought to independently audit the claims. Neither does the Department of Telecom (or may be that I am unaware of any such publication in the mainstream media). I have criticized 3G on many occasions and I see no merit in sinking in huge amount of funds on a technology which would get outdated in rapidly evolving 4G standards. All the more, India missed a golden opportunity to set up it’s own standards for mobile telephony thus forcing the mobile operators to set up an ecosystem of not only the entire gamut of the telecom equipment but handsets also. It would have spurred on demand for quality and generated much better employment prospects than importing the crap dip shit that we are forced to put up with now.

No handset comes closer in terms of oomph and style; something of the likes of an Apple iPhone with it’s iTunes store. While it is profitable, something similar is next to impossible to find here in India- the market of apps is right there but there is no serviceable product.

Nokia has failed terribly; I am definitely impressed by the new layout of it’s Ovi Store but trying to find an app that works across all platforms is like looking for a needle in a haystack. To worsen the matters, the price quoted is in Euros. If any asshole from Nokia India is reading this, please understand that its not possible to pay in Euros here because THAT is NOT the national currency. Besides that, none of the applications are a must have. No wonder, the Finns are getting clobbered left right and centre; the market share has definitely slid down to 60% as per the estimates.

This brings me to the final question. If we dont really have apps or the snazzy and the jazzy handsets, what are we really fighting for? Why should 3G should really be auctioned?

If Internet connectivity is the SOLE criterion, then public Wifi’s should be set up. The Wifis should be free for access upto a certain speed limit; beyond that a price mechanism be set up for higher access speeds. Or broadband initiative be accelerated with the huge amount of Universal Service Obligation Fund (last heard it had swelled up to 18,000 crores). But well, since the lobby market exists in a big way, we can only hope.

For a better round up of the telecom scenario, please read an insightful write up on Knowledge@Wharton write up.

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Any potential loss of revenue is filled up by more than willing government which makes these companies very aggressive on price front. It is said that their prices are about 20% lower than the competing companies from Europe.

I have always maintained that the so called telecom revolution is a BIG major missed opportunity to shore up Indian manufacturing. Except maybe for heavy manufacturing, we have nothing else to speak of. Much of the technology is “imported” while the so called “software superpower” is basically a euphemism for petty sweat shops; likes of ironically China and Malaysia where the downtrodden are paid a pittance by the hour. We had vast swathes of Chinese mobile phones coming in without the mandatory IMEI numbers; a huge security risk. It was all allowed by these bastards to increase their customers knowing fully well the potential security implications.

If that is not all, China has been mounting a covert and overt cyber warfare. First it was well publicized attack on Google which whined and scampered; then media went into overdrive when it was revealed that “sensitive” documents and files were “hacked“.

NY Times carried out a detailed report on this issue.

If we are “serious” about securing our frontiers, we need to “close our backdoors”. Simple. Chinese must be booted out.

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It the The Pioneer that has been after Raja for over a year now and they have permalinks on their homepage detailing the nitty gritty of the telecom auction. Rules were changed at last minute and it only goes on to say and prove the massive clout that these companies have.

Even though Raja is the face of great Indian Telecom scandal (more than Sukh Ram, if the readers care to remember who had no place to stash his ill gotten wealth), the nameless faceless wheelers dealers and fixers are not known. They would NEVER be known.

Pioneer interestingly had an editorial imploring Man-Moron Singh to sack the wily minister ( in interests on keeping the discussion clean, no one calls him a bastard). It is a scary thought. Companies have access to the corridors of power. At beck and call. They practically own the nation. They RUN the nation. Democracy is notional and till the time we don’t wake up to change the system, it would feed on you and me.

The ill gotten wealth is lost in a black hole. We wouldn’t know the quantum of it because it’s hard to believe the media. Yet, the money gifted away would be recovered from you and me. We would have to pay these buggers in way of “surcharges” or whatever they fancy.

TRAI, as usual, would look the other way. They are in any case, ahem….you know what.

Pioneer breaks the “scandal” causing a ruckus in Parliament.

Google News updates.

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I have been stuck up with my studies as I am about to finish off my tenure and hurtling towards my examinations. So the posts would be very sparing for some time to come.

I wouldn’t know of any website specifically catering to the “movers and shakers” of Indian Telecom; if any please let me know. For all practical purposes, I’d request you all to visit the Broadband Forum for all the latest updates as I am really hard pressed for time.

At present, the entire focus is getting my write ups published. I have one publication lined up in an International Journal due to be published soon. There is another one submitted for peer review and two more are lined up for full scale write up after the preliminary analysis has been carried out.

Life’s tough indeed!

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To,
The Central Public Information Officer
Telecom Regulatory Authority of India
Mahanagar Doorsanchar Bhawan,
Jawaharlal Nehru Marg, Old Minto Road,
New Delhi-110 002
Tele: 011-23211622
Fax: 011-23213294

E-mail: ap@trai.gov.in

Sub: Application under the Right to Information Act, 2005 for information relating to Broadband Internet, Fair Usage Policies and pricing mechanism.

Dear Sir,

I am a citizen of India, and I request you to kindly provide me with the following information under the Right to Information Act, 2005 with regards to information relating to Broadband Internet, Fair Usage Policies and pricing mechanism.

1)Why the definition of “broadband” has been kept at 256kbps and not subject to revision for higher speeds? Is there a proposal to re-define the speed of broadband access? If yes, kindly provide the details of the file, notings and objections if any received from Internet Service Providers. The same to be provided in writing by way of certified photocopies.

2)What is the meaning of the term “unlimited internet”?

3)What is the meaning of the term FAIR USAGE POLICY? Has this been put up or suggested by TRAI? If yes, what is the basis for the introducing such a policy? Has the cross section of the user base been consulted before implementing such a policy?

4)Does fair usage policy violate any of the provisions of TRAI?

5)If it does, what action can be taken against errant Internet Service Provider?

6)Has any Internet Service Provider been ever penalised for violating for introducing “fair usage policy”?

7)Do the Internet Service Providers provide details to TRAI about their various broadband plans?

8)If yes, has TRAI suggested reducing the price for various plan combinations? If yes, what is the base price fixed for an unlimited Internet Connection by any Internet Service Provider? If no, is there any provision whereby TRAI can act on behalf of the customer to reduce the prices?

9) How has the tariff on unlimited broadband (1Mbps unlimited) being offered by Bharti Airtel fixed line been calculated?

I would be highly grateful if the above-mentioned information could be provided to me at my postal address within the statutory period of 30 days from the date of receipt of this application.

The requisite fee is being paid along with this application by way of postal order in favour of the accounts officer.

Should there be any additional fees chargeable as per the Act; the same may be communicated to me by e-mail or postal address with the required work up of the details as to how the increased charges are justified and how you have arrived at the calculation of the same.

Please rush the information to me by speed/registered post. If the information is not with you, please forward this application to appropriate PIO, under intimation to me. Please also provide me file notings and action taken report on this application along with your reply.

I sent them today with “Acknowledgement Due” from a post office with the requisite proof of having sent them the postal order. To my knowledge, they cannot feign ignorance; I would be following this up on a regular basis.

Here’s to the power of the people! I am bracing up for a big fight for sure.

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Dear Sir,

This refers to Shyam Ponnapa’s write up on BS dated 05/110/2009 (Managing Spectrum Efficiently).

The big question. Why do we need 3G? Why not focus on the land line business alone for broadband access? Or better still. Community Wifi?

The arguments for doing away with this are many. Community Wifi is deemed to be a security risk but then countries like Singapore have implemented this on a large scale nationwide. The mobile phones required to access 3G invariably have Wifi access too. Unless, the telecom companies are expecting surefire hits like Apple iPhones or flood of other smart phones to access the Internet, it is not happening.

We don’t have accurate numbers about the likes of Reliance and Tata who are offering their 3G access. If initial reports are to be believed, they are plagued by “line of sight” hassles, ‘network congestion’ and lackluster customer support. To top it all, it has the access limitations which means that broadband access, even on the 3G spectrum would be capped for very obvious reasons.

We have enough bandwidth in the country but as anyone would testify, we have problems in implementing the “last mile access”; having a contentious set of issues like 3G is not going to solve the persistent problem of “last mile access” because no one is interested in sinking money for a long term.

We can have a fair idea from the existing companies like Airtel or Vodafone who charge exorbitant rates under the present implementation of “mobile internet”. What is the guarantee that they would lower down the prices once they pay fancy sticker prices in 3G auction?

3G, would most likely be used for carrying more voice traffic because none of the players harbours any disillusionment about the “mobile broadband” across the length and breadth of the country.
The market for value added services is locked up within the “walled garden” of the existing players; it is unlikely that 3G access would “revolutionize” the content.

This pretty much sums up what I have always alluded here and my opposition to 3G remains.

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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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I am all out for mechanisms where the public as a whole has the right to demand services since the spectrum is owned by them. The companys donot own it automatically; I believe that they are just offering a “value added service” for which they charge us. If the value added service (either being it a voice call or the ringtones) not up to the expectations, they should be taken to task.

I get a lot of comments here on the blog each one cribbing about the fact their operators but there is no one willing to take up the cudgels against them. That pisses me off to no end.

I am still hoping that perhaps BJP in the new Government would do something about this seriously.

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Hence, they have bandied together to implement their “fair usage policy”.

Surprisingly and happily, it has found a mention in the mainstream media. Mint has taken up the cudgels on behalf of the existing customers and I truly laud their efforts.

There is no other way except to show a middle finger to the likes of Tatas (are they not always on the wrong end of the stick?), Airtel boffins (why are you screwing up a fantastic service) and Sify (the original buggers who have bastardised the broadband access in India). There are other smaller players who source their bandwidth (in effect work as re-sellers) and would be glad to limit the access accordingly.

Surprisingly, Internet and Mobile Association of India ( a bealagured body that is a rag tag association of the service providers) has spoken out against it’s members. It’s president (or whoever the self proclaimed titular head) has gone on record to say,

“If the service is provided under ‘broadband’ to the customers when they signed in, it cannot be reduced to 128 (kbps) since the government of India definition of broadband is minimum 256 (kbps). This is a violation of government policy as well as short-changing customers if they had signed in for a broadband service.”

Violation of government policy? Really? Which one dude?

For all practical purposes, I request the readers to sign up the petition to protest against the restrictive access. It can be found here.

We are already having a pathetic state of affairs. The frigging morons expect the users to broadband to check email alone. Thats the state of majority of the users.

Who has given them the right to limit our access? Beats me.

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Enjoy the part two of this series. Some of the funniest moments on TV ever seen.

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The size of the deal is pegged at $1.5 billion (about Rs 6,700 crore), translating into a $6-billion (Rs 26,000 crore) valuation for the company that runs networks across the country and is planning to expand into GSM mobile services in the near future. Tata Teleservices is a loss-making company. Between 2005 and 2007, its cumulative losses stood at Rs 5,604 crore

This India story has been done to death many a times. There is no real addition of the 8-9 million customers per month. It is simply not possible. Most of the metros have choked and jammed. It is saturated. In order to expand into tier B and tier C cities, telcos need funds and assured returns. For all practical purposes, I dont forsee the market “hot and happening”; although the 3G services would assure monetised returns and would ride on the value added services.

It is no secret that Tatas claim their superiority of services based on some abstract benchmarks. There are people who would swear to God not to ever think of Tatas as their service provider. Frankly, TRAI has been unable to implement its own customer friendly norms; trying to get anything out of the useless idiots manning the customer service is a herculean task in itself.

Tata is a weathered story. They have lost it and the writing on the wall is as clear as the sunlight illuminating the dark dungeons of their minds. Telecom is a failed venture and they ought to accept defeat and ship out of business.

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It isnt a bad deal for Idea. For the intellectually inclined, here is a spiel from Business Standard (although the link is guranteed to go dead soon):

At Rs 77 per share that Idea is shelling out for the loss-making Spice, the latter is valued at nearly 20 times forward enterprise value /ebitda (EV/ebitda) while at Rs 157, TMIL is valuing Idea around 15 times FY09 EV/ebitda. That’s possibly because at the end of the day Idea is a gainer from the buyout; it will be left with cash, which for a telco that’s planning to become a pan-Indian player and is now present in 13 out of 22 circles, can come in handy. So while Idea will pay Rs 2,700 crore for the stake in Spice, it will get Rs 7,200 crore from Telekom Malaysia, leaving it with a net Rs 4,500 crore.

I am jittery about the Telekom Malaysia investing here in India because they are known to be thugs in the big league. Remember the Salim Group which cosied up with the Left Government in Bengal? They paid a pittiance and got prime land at throwaway prices in order to set up “housing colonies” and malls.

This marks the formation of oligopolies although I am surprised that no other company offered better money for Spice considering the fact that mobile portability is not feasible in present times; most of the original subscribers are loyal to Spice irrespective of their services. It would have been a ready pool of subscribers with an efficient spectrum. There is something fishy on for sure.

Did anyone make any noise about the regulatory approval? Would we ever see anti competitive clauses?

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It has been a fiasco. Tatas feel that they can roughshod over the existing laws and garner a share of suckers who feel that it’s cool to get paid for incoming calls. Bah! How naive can people get? I believe, that one has to pay something upfront to “activate this service”. In any case, this is only product differential they have in an increasingly crowded market. With the eminent launch of newer services, this segment of consumers would surely weigh in gimmicks like these to purchase.

Their offer of handsets sucks. Although, this is good news for those who swear by CDMA. Department of Telecom has referred this matter to TRAI to look in the legal aspects of having Virgin Mobile.

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If Sunil Bharti Mittal is not shitting in his pants yet, he is the biggest moron in the industry. Reliance would be smart enough to upstage the existing players by slashing the costs ruthlessly. I am sure they would sweeten the deals with subsidised handsets or may even give them free initially. Imagine the multiplier effect it would have! They would make their money with locked in handsets and if I can see the situation right, they would go in for bottom of the pyramid where the real voumes lie. Unlike Airtel which has not been able to differentiate it’s offerings or establish it’s brand identity or the typical South Delhi crowd that ohhs aahh’s about the Vodafone screwed up pug. You get the drift.

Raja changed the rules of the game. Videocon (and notice the word “con”) too joined in the fray. Dhoot Sahib is the newest entrant to the millionaire club though would appeal to a typical pan chewing marwari unlike Bharti Mittal who gets himself invited to fancy conclaves. Dhoot too has the foresight to hit below the belt; even though he is an also ran in the electronics market, he has enough foresight to cash out his investment and make a neat pile. Interestingly, a company called as Swan Telecom has been allocated spectrum. I have heard (from my sources) that it is a front end for Reliance only.

In the game of shakers and movers, Airtel can look forward to monetise it’s investment in fixed line telephony. Even though there is a lot of brouhaha about the 3G licences on stake, it would not happen overnight. India is a volumes market and GPRS/EDGE is seriously a load of bull crap multiplied several times over. 3G handsets wouldn’t be affordable atleast for the next 5 years and crowing about Mbps wireless speeds makes no sense. Atleast to me. Unless we speak of Wifi networks in public places. Of course, being powered by fixed lines….

Raja has done a great deal of disservice to the nation by not auctioning off the spectrum. It’s difficult to quantify the exact money that has played in here. We need to know as to why cross over licence was given to the select few. Further, GSM companies have had to eat crow for their insistence on subscriber linked spectrum allocation and for too long they have been getting away with it. When TRAI declared that the subscriber’s number should be 2-3 times the existing number (and all kinds of Government agencies came into limelight to ascertain the spectrum issue), the companies had to sit back and huddle in silence.

The next move is being planned by smart ass lawyers who are going to make a killing in the next few weeks. The legal eagles would surely feast on this unholy carcass.

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