3G News / Data

Tata DoCoMo Hikes Call Tariff in August / September

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The monsoon season is a seasonally weak quarter for the Telecommunications industry in India. However, our Analytics team tracking the Tariffs suggest that Tata DoCoMo has hiked Tariffs between 11% to 142% on various calling packs across various circles in India. Here are the details of the Hike which shows circle name, old tariff followed by new tariff, the change and the impact.

  • AP Seconds pack of Rs22 – 3600 Seconds free to local & STD no. – validity 3 days Seconds pack of Rs22 – 2700 Seconds free to local & STD no. – validity 3 days Reduced free usage RPM impact of 33%
  • AP STD Seconds pack of Rs16 – 2400 seconds free to STD no. – validity 10 days

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Airtel Biggest Beneficiary of Lower Spectrum Usage Charges

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Airtel IndiaCurrently in India, the current spectrum usage charges (SUC) is escalation based on spectrum holdings. On average, operators pay SUCs in the range of 3.6% to 5.6% of adjusted gross revenue (AGR). We believe that lower SUCs (if implemented) will partly offset the spectrum renewal charges to be paid by the operators at the time of licence renewals. Airtel pays the highest SUCs in the industry and would be the biggest beneficiary of a lower SUC regime. In a scenario of a flat 3% SUC (as recommended by the TRAI), Airtel’s potential NPV benefit is Rs20/sh (vs. Rs39/sh for spectrum renewal charges). However, if a flat SUC is pegged at 5%, then the potential benefits for Bharti and Idea will be reduced to Rs5/sh and Rs1/sh, respectively.

Despite significant Reserve Price cut

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Airtel to Launch 3G In Bangladesh with Huawei Network

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Airtel IndiaBharti Airtel’s subsidiary – Airtel Bangladesh has reportedly selected Huawei Technologies as the network partner for launching 3G services in Bangladesh. The company has already received 3G licence with 5 megahertz (MHz) of spectrum in 2100 MHz band for $105 million in the auction held on September 8, 2013. Further, the company is planning introduce 3G base products in Bangladesh to meet the growing demand of high speed surfing and wireless Internet entertainment.

Recently, the Bangladesh Telecommunication Regulatory Commission sold 25 (MHz) of 3G airwaves for $525 million to four telecom operators including

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How Telecom Operators Manage Signalling overload & Traffic Shaping ?

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Signal Overloading - Traffic ShapingThe Advent of SmartPhones has led to the rapid usage of Apps which by design consume network resources resulting in Signal Overloading on Wireless networks. As per White Papers of Network Operators available in public domain, common ways of managing signalling issues are via paging features or queuing.

In Europe, T-Mobile has used the paging channel feature to control signalling traffic, wherein the telco activates the paging channel mode for communication / signalling between RAN and handsets. This reduces signalling by almost 30%, per NSN. Combining messages from various apps, and then transmitting them together when the user brings the mobile phone

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Idea 3G Data Usage Per BTS Exceeds 120 GB / Month + Bid for 900MHz EGSM Band

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Idea Cellular 3G dataIdea’s 3G network usage at 122 GB per BTS per month [Includes Total Traffic of Intra-Circle Arrangements as well] in 1Q is less than 10% currently; each 3G BTS deployed in heavy traffic area can be potentially upgraded to exceed capacity throughput of 3,000 GB per month. To drive greater 3G penetration, customer education (about benefits of mobile data, apps) and cheaper smartphones are more important that lower data pricing per se, according to Idea CEO Himanshu Kapania.

He further said that 3G data business may be unviable at current pricing

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Airtel Advantage 199 Plan Tariff Hiked

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Airtel Mobile is increasing voice tariffs for post-paid customers under one of its per-minute billing plans, Advantage 199, with effect from 8 Sep. This is in-line with our thesis of expected ARPM increases going forward.

Adhering to TRAI guidelines, Bharti Airtel has informed its customers that it will raise tariffs on the Advantage-199 plan. Under this plan, per-minute on-net local and STD rates will be raised to 60 paise from the current 50 paise. Rates for calls to

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How Airtel is better positioned in Mobile Data 3G /4G LTE than Idea ?

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Airtel IndiaAirtel network capex (3G, LTE, fibre), spectrum portfolio (3G, LTE) and operating costs reflect its significant investments to strengthen its data offerings. Hence, Airtel should be better positioned to capture a higher share of data revenue. Bharti’s capital employed currently reflects a total investment of Rs205bn in 3G/LTE spectrum in India. With these investments, Airtel covers 81% of the industry revenue.

Idea has bought 3G spectrum in 11 circles which covers only 49% of the industry revenue and doesn’t include the key metro circles of Delhi, Mumbai and Chennai. Idea’s investment in 3G spectrum

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Now Reliance Communications Gets Serious about Mobile Data Business

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Reliance Communications 3G DataIn its FY13 annual report Reliance Communications expects data and broadband services to be the new driver after multi years of voice leadership. While voice penetration of >70% has been achieved, that for broadband remains abysmally low at <1%. According to various market estimates, data & broadband services can grow ~7x from current Rs50bn to Rs350bn over the next 4‐5 years.

The biggest deterrents to 3G adoption stem from high handset and data pricing in our view but situation could be changing in the past few months. Device prices have

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China’s monthly mobile data usage hits 123MB – Unicom Leads

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According to MIIT, China’s average monthly mobile data usage per mobile Internet user reached 122.8 Mb in 1H13, up 36.6% YoY. Data usage from mobile music and video, mobile gaming, and mobile literature increased 14.0%, 18.9%, and 28.7% from the end of 2012, respectively.

The mobile data usage in China grew >35% YoY to 123MB per sub per month. While the growth rate was robust, the overall usage levels still remain far below the average in Developed Markets (1-2GB) and even other EMs such as Malaysia and Thailand (250-500MB). This remains the key driver of our positive view on China Unicom and China Telecom.

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Telecom Spectrum – Hot Topic for Rest of 2013

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The TRAI has invited Public Comments on the Auction of Telecom Spectrum in India. Incumbents led by Vodafone faces the expiry of its main 900 and 1800MHz licences in India late in 2014 along with the ongoing tax demand for CGT on its original acquisition which remains unresolved. Vodafone is arguing that the spectrum licences entitle the holders to renewal, a point it is making in court, but it is also engaging in government plans for an auction which could be held late this year. Currently the regulator is considering the reserve pricing of the spectrum and given failed auctions earlier in the year we expect a recognition that the pricing of the 3G auctions was not the right reference point and that reserve prices will be reduced.

Uncertainty remains over whether Vodafone, Airtel and Idea will be allowed to use each others’ spectrum for 3G intra-circle roaming which has

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