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crying wolf! the costs can be passed on to consumers...
Sir, mere revenue does not tell the health of a company. RIL, ONGC, IOC, BPCL, HPCL. Jet Airways, Bharti, Coal India, NTPC all have big revenues but half of these are bleeding . Many a times more an item is sold, more the losses. It is common to hear , on every trip Air India is making a loss of x rupee , or on each litre of petrol company is making a loss of 5 rupee. So do not be happy merely to see revenues. Real thing is how much Return on Assets or profit margin is there. Vodafone is already in dispute with govt. Bharti revenue have grown by 30-40% but profit have fallen, is it a good sign or bad ? you decide my friend. ...
News & Views Today : Central Minister, Sri Anand Sharma has criticized the TRAI recommendations on spectrum sharing. He is right. Acceptance of the TRAI recommendations will strike a death blow on the Telecom Industry. Industry Players are already on Protest. They are very right. But, what is the way out? why this tangle? Will Telecom go the way of Air lines Industry? If the Government`s VISION is clear, the PATH is very clear. Read detailed analysis at : http://t.in.com/4n9o...
TELECOM: Vodafone Plc has slammed the inclusion of its name in an official document on black money in India and blamed the country`s bureaucracy for its recent travails.
-Impressive growth in earnings from voice services pushed up Vodafone India `s 2011-12 (Apr-Mar) revenue 19.5% to 321.84 bln rupees, and boosted operating profit 21.6% to 85.49 bln rupees.
-Vodafone India will not come out with its initial public offer in 2012, before the 2G spectrum auction takes place.
-Department of Telecommunications has said bilateral investment treaties invoked by three foreign telecom investors in the license cancellation matter will not apply as the cancellation came by an order of the Supreme Court....
Vodafone India appears to have managed its topline well to show a 20% increase. Bharti and RCOM have remained flat on India revenues, whereas Idea has shown a 20% Y-o-Y gain for Q4.
Profitability is another matter, with Vodafone India showing negligible profits, in contrast with any of the Indian telcos which show far better profits. Looks like Vodafone India`s profits are being siphoned off to its parents.
Now let us turn our attention to the claims and counter-claims made on the impact of the spectrum charges.
TRAI`s calculations show that the impact of spectrum charges will be Rs. 0.044 / Minute Of Use (MOU) in the first year going down to Rs. 0.017 / MOU by Year 20, basis country-wide usage statistics (not circle-wise). Detailed calculations are provided. Nothing to dispute here.
COAI has commissioned Price WaterhouseCoopers (PwC) to do their own calculations. PwC states that the impact will be as high as Rs. 0.9 / MOU in metros and Rs. 0.29 to 0.34 / MOU in other circles. No calculations are given. Appears that the numbers are pulled out of thin air, as is every statement by the telcos.
Even conceding that there is a variation across circles because of different reserve price, the weighted average country-wide impact as per PwC will work out to Rs. 0.4 to 0.44 / MOU, i.e. 10 times the TRAI calculations.
PwC states that TRAI calculations take into account both outgoing and incoming minutes. If this is so, fair enough, TRAI`s impact will still come to Rs. 0.088 / MOU in Year 1. PwC estimate is still 5 times.
I respect and accept the industry`s need to scream loudly when their interests are affected. However, they should remember that there are equally bright and strong-willed people on the other side of their argument.
Note: Calculations shown above assume 100% of impact of spectrum charges are apportioned to voice services....
One needs to see TRAI`s and the telcos` math to make a judgement. It seems difficult to believe that with among world`s the lowest tariffs and huge increase in spectrum pricing, the cost increase can be as minimal as what TRAI suggests. Further, telecom companies should not be made to pay unless it is established with the government of the day to fix low tariffs. The Indian government needs to stop "strong arming" and playing bully in every aspect of business....
Yes, it appears so. India is one of the fastest and sensitive market in the world. Telcos have to thread carefully....
Vodafone’s FY12 numbers underscore the robustness in the mobile phone services segment, despite stagnant voice tariffs in India and slow pick up in data usage. The company’s annual revenues grew around 20% to Rs 32,000 with operating margin at a juicy 26% plus. And this, despite the fierce competition in the sector. But the picture could change dramatically if the TRAI proposals on spectrum refarming and high reserve price for 2G spectrum are accepted. Understandably, telecom companies are opposed to the recommendations. TRAI claims that even if telecom companies were to pass on the higher spectrum cost to consumers, the increase in tariff would not be more than a few paise. Telecom companies on the other hand claim that tariffs would almost double if they had to bid for spectrum at what they see as ruinous rates. What do you think? Are telcom companies complaining too much?...
TELECOM: Department of Telecommunications will press for a 17% increase in the base price of 2G mobile telephony spectrum bids over the rate proposed by the Telecom Regulatory Authority of India....
I dont thik that the NTP will be get this year. because we never heart any latest news about roaming free from telecom sector or from Kapil sibbal after oct 2011....
