How Mukesh Ambani’s Reliance Jio shook up India’s telecom market

Source: LiveMint.com, Oct 17, 2018

Within two years, India’s richest person turned the local mobile-phone market into the world’s biggest consumer of wireless data. But along the way, billionaire Mukesh Ambani laid waste to profits in the overcrowded industry by driving down prices to as low as zero.

Ambani leads Reliance Jio Infocomm Ltd., which has gone from zero to more than 200 million subscribers, all of them on a nationwide 4G network, since 2016. While the user growth has come at the expense of smaller rivals who’ve merged or quit the market, the thrust into the country’s No. 3 spot for wireless carriers has also ravaged profit at Bharti Airtel Ltd., and Idea Cellular Ltd. The latter has merged with Vodafone Group Plc’s India unit to overtake Bharti as the market’s biggest operator. Read the rest of this entry »

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Customs duty raised on telecom equipment

Source: The Economic Times, Oct 12, 2018

NEW DELHI: India has raised basic customs duty on several telecom equipment and imposed duties on printed circuit boards used to make these as the country looks to curb non-essential imports to address its current account deficit as also boost ‘Make in India’.

Telecom products including base stations, optical transport equipment, combination of one or more of Packet Optical Transport Product or Switch (POTP or POTS), Optical Transport Network (OTN) products and IP radios will face customs duty of 20% instead of 10% now. Read the rest of this entry »

Telcos seek alternative digital identification process for new users

Source: LiveMint.com, Oct 11, 2018

After the Supreme Court barred telecom operators from using Aadhaar to validate identity of mobile subscribers, the Cellular Operators Association of India (COAI) has suggested several alternative measures to the government to prevent a return to the days of paper-based identity verification.

These include entering various fields in the customer acquisition form electronically on the operator’s app, capturing GPS coordinates while capturing the customer’s live photo at the point of sale of the mobile connection, watermarking the photo and assigning a unique operator code so that the photo cannot be copied or re-used.

As additional safeguard, the system will also verify that the geotag of the customer’s picture and final submission of request by the point of sale is not more than 50 metres away, the letter added. Read the rest of this entry »

As users dip, data drives growth in India’s telecom sector

Source: LiveMint.com, Oct 09, 2018

New Delhi: After grappling with falling revenues over the last two years following the entry of Reliance Jio Infocomm Ltd in September 2016, India’s telecom sector now faces a shrinking mobile user base, signalling the end of the era of runaway growth during which the market grew from 873.36 million to 1.14 billion in number terms over the last five years. It also means operators need to focus on driving more data usage per SIM instead of flooding the market with SIM cards.

The sector regulator, Telecom Regulatory Authority of India (Trai), counts each connection as a subscriber, though there are some overlaps. Read the rest of this entry »

DoT seeks legal opinion on creation of ombudsman under Trai

Source: Business Standard, Oct 03, 2018

New Delhi: The Department of Telecom has sought legal opinion on creation of an ombudsman under sector regulator Trai which aims to give impartial hearing to telecom subscribers on their complaints.

“The DoT has sought legal opinion on some points in the framework for telecom sector ombudsman. Once the legal opinion is received, the framework will be modified, if required, and it will be shared with Trai,” an official source said.

The Trai Act may be modified to create an ombudsman with power to penalise operators or compensate consumers.

Telecom grievances mechanism till date has largely remained within control of service providers. Under present norms, telecom subscribers can register a complaint with the call centre of their service provider. It can be escalated to nodal officer of the telecom operator in case the complaint is not resolved and thereafter Appellate Authority set-up by the service provider. Read the rest of this entry »

For telecom operators, there is a strange light at the end of the tunnel

Source: LiveMint.com, Oct 02, 2018

“We feel the machine slipping from our hands, as if someone else were steering; if we see a light at the end of the tunnel, it’s the light of an oncoming train,” wrote Robert Lowell in the poem Since 1939. It’s a sentiment incumbents in India’s telecom industry have identified with since September 2016. In the June 2016 quarter, before new entrant Reliance Jio Infocomm Ltd started steering the ship, Bharti Airtel Ltd’s India wireless unit boasted annualized revenue of more than ₹60,000 crore with Ebitda (earnings before interest, tax, depreciation and amortization) margin of as high 42.4%.

Revenues and profits have fallen almost every quarter since. In the September 2018 quarter, analysts at Kotak Institutional Equities estimate Airtel’s India wireless business to post annualized revenue of ₹40,650 crore, a 32.5% drop from pre-Jio levels. With margins falling sharply as well, the fall in Ebitda is expected to be as high as 64%. Read the rest of this entry »

Import duty on 35 capital goods waived to boost mobile phone manufacturing

Source: Business Standard, Sept 29, 2018

New Delhi: The government has exempted 35 machine parts used for manufacturing mobile phone components from the basic customs duty to promote handset production in the country, according to an official notification.

In a notification dated September 28, the finance ministry exempted items such as printed circuit board (commonly known as motherboard) coating machine, PCB assembly loader, unloader from customs duty.

These 35 capital goods are used for making mobile phone components such as lithium-ion batteries, speakers and receivers of mobile phones, data cables, and optical fibres. Read the rest of this entry »