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


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

Another new operator Uninor, a joint venture between Telenor of Norway and
Unitech, has also conveyed that the company would participate in the spectrum


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


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.”


Baburajan K

[email protected]


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