2G spectrum: How Indian telecom industry can expect opportunities after Supreme Court order
By Telecom Lead Team: The telecom market in India is coming back strongly from the rude shock of February 2 Supreme Court order. Indications are that most of the mobile service providers will stay back in India as the government is likely to ask apex court to review its order that affected more than 10,000 jobs and $6 billion investment in telecom infrastructure.
A prompt action from government will improve market sentiments. Kapil Sibal and his team are in Barcelona and assuring complete support to foreign investors. At present, there are more hopes towards a strong revival of conditions. India can come back to its 2006-08 investment levels if the telecom minister conducts 4G spectrum auction in 2012.
Many operators are assuring that they do not want to quit India. Videocon today said it plans to continue its telecom operations and will participate in the auction for 2G spectrum.
“VTL is continuing with its business. It proposes to participate in the auction and is hopeful of continuing the business thereafter,” Videocon Industries said in its financial results filed on BSE.
Another new operator Uninor, a joint venture between Telenor of Norway and Unitech, has also conveyed that the company would participate in the spectrum auction.
Kapil Sibal said Etisalat has no intention of quitting India, according to a PTI report.
On February 22, Etisalat announced that it would shut down its Indian operation — Etisalat DB — that has over 16.7 lakh mobile subscribers across 15 circles including Andhra Pradesh, Gujarat, Haryana, Karnataka, Kerala, Maharashtra, Mumbai and Punjab.
Huawei, Ericsson India CEOs express concerns
“The year 2011 was very good for Huawei India. But this year will be a tough year. However, our recent discussion with telecom minister assisted us in gaining confidence on 2G spectrum issue and we are hopeful that the market will improve soon,” said Cai Liqun, chief executive officer, Huawei India.
Ericsson India looking for a stable and predictable telecom market
Recently, Ericsson India CEO Fredrik Jejdling said that Ericsson is looking at a market which is more stable and predictable to improve business in 2012. Due to delay in 2G roll outs and 3G expansion, many leading equipment vendors could not meet their revenue targets in last two quarters.
Bharti Airtel chief Sunil Mittal favors affordable tariffs that would also be viable for the sector, underlining the need for a balanced growth in the telecom industry.
On the issue of uncertainties over pricing of spectrum, Bharti chief told PTI, “We have been offering services with lower tariffs when we have not been charged for spectrum. Going ahead, if it (spectrum) will be charged, we will also have to charge the customer.”
Meanwhile, the government in its petition filed states that because an auction cannot be held by then, nearly 70 million cell phone subscribers will be left in the lurch. Customers who have been with an operator for more than 90 days are entitled to switch immediately to a different mobile company.
Earlier this week, Tata Teleservices filed an appeal in the Supreme Court against the cancellations of its licenses in three circles; several other telecoms are expected to follow suit.
In its application, the government said yesterday, “As the licenses/spectrum can be issued only in and around March 2013 and the licenses stand quashed with effect from June 2, 2012, there will be an inevitable disruption in services for the subscribers of those license holders whose licenses stand quashed by virtue of the judgment of this court…It is respectfully stated that the total number of subscribers indirectly affected by the judgment of this court is over 69 million, representing almost 7.5 percent of the total mobile subscribers in India.”