Idea to Launch 4G Services in 750 Towns by H1 2016

Idea Cellular Wednesday said it plans to launch 4G services in 750 towns across 10 circles by the first half of 2016.

The country’s third largest mobile operator also plans to introduce from next fiscal its branded digital services applications like Idea Music, Idea Games, Idea Movies and Idea Digital Wallets etc, with focus on regional and vernacular content.

“In its initial phase Idea intends to roll out its 4G services across 10 telecom service areas over 750 large and small towns by first half of 2016,” the company said in a statement.

The circles include Maharashtra and Goa, Andhra Pradesh, Madhya Pradesh and Chhattisgarh, Kerala, Punjab, Haryana, Karnataka, Orissa, Tamil Nadu and North East.

The company said it had acquired spectrum in 1800 MHz band, used for offering 4G services, during the last two spectrum auctions in February 2014 and March 2015.

“Given the large mobile data and rural voice opportunities, Idea with increasing consumer affinity, steady cash flows, deep rural 2G presence, expanding 3G network footprint and planned 4G LTE network launch the company remains confident to further strengthen its market competitive standing and emerge stronger,” Idea said.

Bharti Airtel and Aircel have already launched 4G services, whereas Vodafone has announced plans to roll out services in Delhi and Mumbai by December this year. Reliance Jio is also expected to announce 4G services launch by December.

More Concerns Raised Over Trai’s Call Drop Penalty Rules

The Indian telecom watchdog’s decision to penalise mobile phone service providers for call drops is fraught with glitches as it ignores issues like technical hurdles in assigning reasons, poor spectrum policy, and obstacles in the rollout of towers, analysts maintain.

On the face of it, Re. 1 penalty per call drop, limited to a cap of three such occurrences per day, may not appear steep. A subscriber could get a maximum of Rs. 90 per month. But based on average revenues per subscriber, which is Rs. 180 – Rs. 200 for Idea and Bharti, it can prove quite a knock.

“There are also likely to be technical hurdles in implementation. Based on our discussions with telcos, it isn’t easy to determine the cause of call drops,” said a Nomura report, adding this can be due to limitations in both the originating network and terminating network.

Actions like removing phone batteries or stepping into low coverage areas can also be the causes.

“Anyone designing telecom networks will know that ensuring nil call drops is near impossible for commercial operators. There are several external factors beyond the operators’ control that could influence call drops,” said Credit Suisse, while also pointing out some technical glitches.

“The new rules mandate that only originating network is to compensate the originating subscriber. It is not clear how the situation is handled if the call drop occurs due to a problem with the terminating network,” it said.

A Morgan Stanley report questioned how this can be executed. “The unanswered question is how will the regulator practically implement testing methodology for call drop, as it could imply as much as 50 percent of average revenue per user is at risk for the most unreliable network operators.”

Speaking about the existing norms, Deutsche Bank Market Research said mobile companies currently need to achieve less than 2 percent call drops and that tests by the regulators own reports show that companies are adhering to this across most of their operating markets.

“Hence we are perplexed by the move for penalty on a per-call basis. The regulation is likely to introduce another layer of complexity to the operators’ billing systems. Besides the regulator has not specified any mechanism to audit the claims which are bound to arise in future.”

In its report, the regulator said it had examined the representations of telecom operators, who maintained that some issues beyond their control, like poor spectrum allocation and difficulties in setting up towers, were also contributing to call drops.

But the watchdog said it was for this reason that the the compensatory mechanism has been kept simple, so that the consumers can understand the same easily, and the operators are able to implement it as well. The new norms take effect from January next year.

“Our analysis suggests that potential penalties may have an adverse impact on Bharti’s revenues by 4percent and earnings before interest, taxes , depreciation and amortisation by 7 percent. Telcos have the option to challenge new regulations in court,” said HSBC Global Research.

Adding to it, Deutsche Bank report said: “The regulation is likely to introduce another layer of complexity to the operators’ billing systems. Besides the telecom regulator has not specified any mechanism to audit the claims which are bound to arise in future.”

Some analysts felt, this could also impact on the 4G players.

“Though coverage issues for 4G entrants don’t get resolved till the time they have access to 850 spectrum band, new regulations on call drops may help 4G players in the launch phase by managing subscriber expectations relatively better,” said HSBC Global Research.

“Furthermore, capex (capital expenditure) for competition goes up and puts them in a situation to focus more on voice, at a time when data is the growing category,” it said adding the regulations may also delay the plans of incumbent telcos to re-farm 900 MHz spectrum band for data.

But the representative body, Cellular Operators Association of India (COAI) has not lost hope.

“Our first preference is to engage in a dialogue with the regulator to get clarifications over call drop norms, keeping in mind there is time till December 31. But if no proper resolution comes out of the dialogue, we will have to seek legal help to protect our interests.”

Call Drop Issue

Tightening regulations, telecom regulator Trai Thursday raised the penalty on telecom operators to up to Rs. 2 lakh for poor mobile service quality, including call drops.

The penalty amount would be as high as Rs. 2 lakh if the operators are unable to meet the benchmark set for the quality of service in two or more subsequent quarters, the Telecom Regulatory Authority of India (Trai) said.

The penalty will kick-in if call drops in a quarter average more than 2 percent of the total traffic in a telecom circle.

“The proportion (incidents) of non-compliance in case of customer related parameters are more than that of network related parameters. Hence the Authority has decided to impose identical structure of financial disincentive in both cases,” Trai said in a statement.

As per the rules, call drop, availability of mobile towers, time taken for a call to connect, network congestion, voice quality and network related issues feature in the Trai’s service quality parameters.

Consumer-related issues include complaint redressal, refund of wrongly charged money, access to call centre etc.

As per existing norms, there is a penalty provision of up to Rs. 50,000 for the first violation and Rs. 1 lakh for subsequent failures in case of network related quality parameters. However, with regard to consumer-related issues the penalty was capped at Rs. 50,000 for each violation.

Now for the first time violation of service quality benchmark, the fine has been increased to Rs. 1 lakh.

If telecom operators fail to meet the benchmark on the same parameter further, a penalty of up to Rs. 1.5 lakh for the second violation and Rs. 2 lakh thereafter.

“The Authority feels that these measures will act as a sufficient deterrent against prolonged non-compliance and will further improve the quality of service in a time-bound manner,” the regulator said.

Trai has found no significant improvement in the call drop issue in Mumbai and Delhi as operators are lagging on various fronts in meeting the standards.

Commenting on the matter, Bharti Airtel Chairman Sunil Bharti Mittal said, “The whole industry is focussed on call drops issue. Have assured the Telecom Minister about measures.

We will wait for final call taken by the DoT on compensation.

The government is in process of giving companies more sites for towers.”

“Before the recommendation is implemented, the root cause of the call drop should be analysed. For example, lack of sufficient towers in the service area, strict radiation norms which are stringent than the global norms, spectrum issues, etc, must be addressed,” Deloitte Haskins & Sells LLP Partner Hemant Joshi said.

Earlier in a statement today, Trai said that in Mumbai, no operator is meeting the benchmark while in Delhi three top players Airtel, Vodafone and Aircel are found to be lagging in offering good quality services.

As per data shared by Telecom Regulatory Authority of India (Trai), call drops on network of Idea Cellular, Reliance Communications and Tata Teleservices have improved in Delhi.

However, problem on Aircel and Vodafone network has further deteriorated in the national capital. Airtel has improved the quality but it is still far away from the set parameters.

‘Nearly 40 Percent Mobile Towers in East Delhi Unauthorised’

Nearly 40 percent of a total of of 2,198 mobile phone towers installed in the areas under East Delhi Municipal Corporation are unauthorised.

The issue of unauthorised towers in the EDMC area was raised in the Standing Committee meeting Thursday by councillor Manoj Tyagi through a short notice question.

An official of the building department informed the committee that of a total of 941 mobile towers in Shahdara North zone of EDMC, 448 towers are unauthorised. In Shahdara South zone, the number of unauthorised towers is 354 out of a total of 1,257 towers.

The official said that 543 unauthorised towers were sealed between January 1, 2012, and October 13, 2015. While 335 towers were sealed in Shahdara South zone, 208 towers were sealed in Shahdara North zone for unauthorised installation or for failing to show permission by EDMC.

Some of the sealed mobile towers were later cleared after their operators produced permission papers, said the officer. Under the erstwhile unified municipal corporation, mobile towers were to be installed in areas within its jurisdiction upon payment of a one-time permission charge of Rs. 1 lakh.

However, the new policy, implemented from April 8, 2010, raised that fee to Rs. 5 lakh. Afterwards, the matter went to high court and is still pending there.

As a result, EDMC’s building department has not realised any permission charge since the trifurcation of the unified municipal corporation.

The civic body is presently giving permission for installation of towers in areas under its jurisdiction without charging any fee for the same. An affidavit with effect to payment of fee as per the court’s order is taken from the applicants, he added.

Airtel Deal to Sell Over 3,500 Towers in Africa Collapses

Bharti Airtel Friday said the deal to sell over 3,500 telecom towers in Africa to Eaton Towers has lapsed and stands terminated.

“The agreements for sale of tower assets in Africa between Bharti Airtel Malawi Holdings B.V. & ors. and Eaton Towers (Lilongwe) Ltd & ors. has lapsed and therefore stands terminated,” Bharti Airtel said in a regulatory filing.

Last year in September, Airtel announced that it has sold over 3,500 telecom towers in Africa to Eaton Towers.

As part of the deal, Airtel was to sell and lease back over 3,500 towers to Eaton in 6 countries across its African operations under a 10-year contract. The company had said the agreement would allow Airtel to focus on its core business and customers, enable it to deleverage through debt reduction, and would significantly reduce its on-going capital expenditure on passive infrastructure.

Airtel in June said its agreement with Helios Towers Africa for sale of its tower assets in Tanzania and Tchad stands terminated. The company in July last year signed a deal with Helios Towers Africa (HTA) for sale of 3,100 towers in four countries across its African operations, which span across 17 nations.

The company had not mentioned names of the countries but sources had said the deal was signed for Tanzania, Tchad, Congo and Democratic Republic of the Congo. Now the deal with Tanzania and Tchad stands terminated, the agreement with HTA for Congo and Democratic Republic of the Congo is still intact, sources said.

India’s Telecom Subscriber Base Crossed 1.01-Billion Mark in August

Driven by growth in mobile phone users, Indian telecom subscribers crossed 1.01 billion mark in August, as per regulator Trai data.

“The number of telephone subscribers in India increased from 1,009.31 million at the end of July 2015 to 1,014.70 million at the end of August 2015, thereby showing a monthly growth rate of 0.53 percent,” Telecom Regulatory Authority of India (Trai) said in its monthly subscribers report.

The wireless or mobile subscriber base in the country grew by half a percent to 988.6 million in August from 983.2 million in July.

Out of the total wireless subscriber base, 885.9 million customers were found active. However, the subscriber base of landline continued its decline despite public sector BSNL and MTNL offering free calling schemes.

The landline or wireline connections declined from 26.1 million in July to 26.0 million at the end of August. The growth in mobile users was led by telecom major Bharti Airtel with net subscriber addition of 1.312 million in August, followed by Idea Cellular with 1.167 million users, Vodafone 1.127 million,Tata Teleservices 825,000, BSNL 812,000, Telenor 390,000, Aircel 384,000, Videocon Telecom (with Quadrant) 116,000, and MTNL 18,132.

Sistema Shyam and Reliance Communications, both companies that are in process of consolidation, lost 182,000 and 491,000 users, respectively. Reliance Communications saw maximum erosion in subscriber base in Bihar where its right to use the 900MHz spectrum (2G) expires this December.

In the landline segment Bharti Airtel was biggest gainer, while state-run BSNL was biggest loser in August. The number of broadband subscribers increased to 117.3 million at the end of August, with monthly growth rate of 3.55 percent compared to 113.3 million in July. In the month of August, a total of 4.3 million subscribers submitted their requests for mobile number portability service taking the cumulative request to 172.2 million.

German Parliament Approves Law to Store Mobile, Internet Data

German telecom companies will be obliged to keep telephone and Internet data for up to 10 weeks to help fight crime under a new law passed by parliament on Friday after a long political wrangle over possible infringements of individuals’ rights.

Under the data retention law, companies will be required to keep data on the timing and duration of telephone calls, as well as online traffic through IP addresses. Location data from mobile phones may only be stored for four weeks.

Telecom and Internet companies will be forbidden from storing the content of communications, while email traffic is excluded from the new law. Data retention centres will also be located in Germany, Justice Minister Heiko Maas told parliament.

Privacy is a particularly sensitive issue in Germany because of the surveillance by the Gestapo in the Nazi era and by communist East Germany’s Stasi secret police.

Disclosures by former NSA contractor Edward Snowden about widespread espionage in Germany by the United States caused outrage in Germany.

The debate over the new law set Chancellor Angela Merkel’s conservatives (CDU) at loggerheads with her Social Democrat (SPD) junior coalition partner, while opposition parties and critics argued the law violated human rights and would put millions of citizens under general suspicion.

Last year, the European Union’s highest court overthrew a rule that required telecoms companies to store the communications data of EU citizens for up to two years on the grounds it infringed human rights.

In 2010, Germany’s Constitutional Court blocked a law to store all data for six months.

Maas saw the new legislation as a compromise that would give police an “additional tool” to help fight the most serious crimes.

“It is proportionate because less data will be stored, we will save data for a much shorter period and because access to the data has been made significantly harder,” Mass said.

Jio Network Rollout Substantial, Says Reliance

Reliance industries (RIL) on Friday said that it has substantially completed the rollout of Reliance Jio’s network across the country and rigorous tests for a pan-India launch are now in full swing.

“In digital services, we have substantially completed the network rollout across the country and initiated the process of beta testing of our network and platforms,” chairman Mukesh Ambani said in a statement after declaring the company’s results for the quarter ended September 30.

In a filing with exchanges, Reliance said its Jio Infocomm has launched Wi-Fi hotspots across several locations in the country and has entered into accords with some of the state and local authorities to provide such services.

Roll-out of last-mile connectivity for its fibre-to-the-home business is also on. The company, which holds a pan-India unified licence for all net-based services, including voice and data, said that the initial test results on the network were positive.

“The company expects to ramp up its beta program over the next few weeks to further optimise the network, prior to commercial launch of operations. Financial year 2016-17 is projected to be the first year of commercial operations for Reliance Jio,” the company said.

The company has also filed intimation for sharing of spectrum in the 800MHz band with Reliance Communications across seven circles to department of telecommunications (DoT).

Reliance Jio aims to offer end-to-end solutions that address the entire value chain across various digital services in key domains such as education, healthcare, security, communication, financial services, government-citizen interfaces and entertainment.

Concerns Raised Over Trai’s Call Drop Compensation Rules

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Experts have raised concerns over the implementation of telecom regulator Trai’s new rules regarding the compensation to consumers for call drops.

Under the rule, mobile users will get a compensation of Re 1 for every dropped call from January 1 but it will be limited to a maximum three dropped calls in a day.

However, the compensation will be given only if the call drop takes place due to the calling party’s network and not because of the receiving operator’s network.

The Telecom Regulatory Authority of India (Trai) has said that telecom operators from whose network call is originated will have to compensate customer if the call gets disconnected because of fault in its network.

“If a call drop happens because of the network, than compensation has to be given,” Trai Secretary Sudhir Gupta said.

He, however, added the compensation will be paid only when the call drop happened due to the calling party’s network and not on the receiving operator’s network.

Rajya Sabha MP Rajeev Chandrasekhar appreciated the move and said this is the first time the regulator and government are addressing the issue of consumer rights.

“For all these years, policies and regulations were in favour of telecom companies and there was little or no attention paid to the interests of consumers,” he said.

While the industry has raised question on feasibility of its execution under their telecom licences rules, experts feel the rule will not benefit customers in a big way.

“The monetary benefits to consumers from the regulation may not be huge; but implementing it will be a challenge.

Moreover, despite the heavy operator investments on acquiring spectrum, insufficient tower infrastructure to cater to the ever rising demand is leading to poor quality of service and call drops,” Ernst & Young India Global Telecommunications Leader Prashant Singhal said.

An NGO, Telecom Watchdog, said that the issue has been decided in favour of the operators, not the consumers, as is being made out.

The NGO Secretary Anil Kumar said that it will be very difficult to verify fault in the network and “practically consumers will not get any compensation. Over one year period, such compensation will not be more than Rs 10 crore across India for one operator”.

Industry body Cellular Operators Association of India, however, estimates that even half of subscriber base in the country reports this problem then outflow for industry will be to the tune of Rs 150 crore per day.

COAI Director General Rajan S Mathews expressed disappointment on the regulation and called it diversion from real issues that are responsible for call drops.

“How can you expect to resolve the call drop problem with local authorities sealing mobile towers? Nearly 350 towers have been sealed in Delhi in the last three weeks and 100 in Mumbai in the last 4-5 months.” he asked.

He also said licence conditions do not mandate operators to provide 100 per cent coverage and also inside buildings.

“Even the licence doesn’t require me to provide 100 per cent coverage so if call drops happen on the uncovered areas. Why should I be penalised. Why should an operator compensate if call drop happens inside building?” he added.

Sebi Seeks Help From Telecom Operators, Banks

Concerned over a spurt in investment scams perpetrated through SMSes, WhatsApp and social media, Sebi has beefed up its surveillance on such platforms and is seeking greater cooperation from the mobile and Internet service providers, as well as banks, to nail the culprits.

The market trading activities have seen a major upsurge in recent months, but this positive environment is also leading to many fundamentally weak stocks generating interest.

The Securities and Exchange Board of India (Sebi) has enhanced surveillance on such securities so as to ensure that no unscrupulous players take genuine investors for a ride.

The modus operandi revealed by this enhanced vigil typically includes tax evasion through bogus gains or losses through stock market platform; trading on the basis of Unpublished Price Sensitive Information; and certain Indian and overseas entities engaging in fraudulent activities of manipulating GDR route.

This vigil has also unearthed a large number of cases where unregistered entities are indulging in fraudulent act of luring investors to securities market through false and unrealistic SMS claims, a senior official said.

To check this menace, Sebi has enhanced its surveillance to catch such scamsters and the number of requests to the mobile operators, internet service providers and banks have gone up significantly in the recent months.

While most of the requests are being adhered to on time, some telecom operators have been found to be lax in replying to the information requests from Sebi, the official said.

The matter would be taken up with the Telecom Ministry if the requests remain pending despite further reminders, he said while adding that banks have been relatively more cooperative.

Typically, the gullible investors are first lured by these scamsters through SMSes, WhatsApp messages and posts on social media platforms like Facebook and Twitter, after which they are given certain bank account numbers to deposit money.

The mobile numbers and URLs, as also the bank account numbers, become the mainstay for the investigation by Sebi, ownership details of which help the regulator reach the perpetrators of such manipulative activities.

Besides tightening its noose on the scamsters, Sebi has also enhanced its investor awareness campaign on these issues.

In a latest public notice, the capital markets regulator has cautioned the investors against trading on the basis of unsolicited tips received through SMSes, social media, websites and other public media platforms.

It also asked the public to deal with only Sebi-registered investment advisers and research analysts and warned the unregistered entities of strict action.

Sebi has already taken action against seven such entities for providing investment advice without registration.

Leading bourse BSE also said that “investors are cautioned against SMS tips to buy certain scrips suggesting increase in their market price”.

“Do not blindly follow these tips and do thorough analysis about the company before investing,” it added.

Cautioning the investors, NSE also said, “Do not trade on the basis of SMS tips”.