Mobile operator CEOs to meet telecom minister Kabil Sibal to discuss spectrum pricing

Telecom Lead Team:
Heads of leading mobile operators
including Bharti Airtel, Reliance Communications and Idea Cellular will be
meeting Telecom Minister Kapil Sibal on Tuesday to discuss pricing of spectrum
and allocation.


The high level
government-industry interaction would take place for the second time within less
than two months. The industry leaders, including Sunil Bharti Mittal, Anil
Ambani and Kumar Mangalam Birla had met Prime Minister Manmohan Singh on
November 30 on the same issues, according to a PTI report.


meeting will have a wide-ranging agenda. Issues like pricing of spectrum
(telecom airwaves) and allocation would also be discussed,” said a
Department of Telecommunication (DoT) official.


The other
contentious issue like the government seeking one-time fee for 2G spectrum in
excess of 4.4 MHz and row over 3G roaming would also figure in the talks.


The Indian
telecom industry is opposing the government move to charge one-time fee on
spectrum beyond 4.4 MHz for GSM operators and 2.5 MHz for CDMA players. If the
fee is levied, their profit could be impacted by approximately Rs 17,000 crore.


The operators
have contended that such a move would limit growth and discourage fresh
investment in the sector which has over 800 million subscribers.


For the future
allocation of 2G airwaves (due for first renewal in 2014) the established
operators are willing for an auction.


There is also a
concern over the banks refusing to lend to the industry as a fall-out of the 2G
scam. The industry wants the government to direct the banks to restore lending
and build confidence in the scam-ridden sector.


Another issue
facing the industry is the need for mergers and acquisition guidelines as the
licensing circles are over-crowded with as many as 13-15 operators per circle.


Several of the
service providers are struggling to survive and seem to be desperate for exit,
which is not provided in the existing policy.


Idea posts 27.17% increase in Q3
2011-12 revenue at Rs 5,031 crore


instance, Idea Cellular has posted 27.17 percent increase in revenue in Q3 FY
2011-12 at Rs 5,030.82 crore as compared with Rs 3,955.61 crore in the
corresponding quarter in previous year. Its net profit plummeted 17.31 percent
to Rs 200.98 crore in the third quarter of current fiscal from Rs 243.05 crore
in the same quarter last fiscal.


quarterly revenue growth was 8.8 percent. Revenue growth is led by seasonal
return of minute’s growth to 114 billion, a growth of 7.3 percent, compared to
Q2 FY12. The minutes volume expansion was supported by 7.5 million net VLR
subscriber additions during Q3 FY12 against 3.2 million in Q2FY12. Idea has the
highest active subscriber ratio of 92.3 percent as per TRAI. The company
maintains the upward trend of Average Realisation Per Minute (ARPM) from 42.7p
in Q2 FY12 to 43.3p in Q3 FY12.


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