On the Supreme Court Verdict

So mobile bubble bursts in India! With Supreme Court’s verdict regarding cancellation of 122 licenses for 2G mobile services given in 2008 by the-then Telecom Minister A. Raja, Indian telecom sector will see worst nightmare in coming days while incumbent operators will have their position stronger than ever in last 4 years.

Supreme Court comments that 2G spectrum in 2008 was given away in a “totally arbitrary and unconstitutional” manner. SC also imposed penalty of 5 Cr to Etisalat-DB, Unitech Wireless and Tatas and Rs. 50 lakh to Loop and Shyam-Sistema respectively.

The impacts of this decision are huge and can put the whole telecom sector in emergency as all of these operators are in business for some years and they have employees and too many contracts with vendors, network operators and other companies. Overall they have a good number of subscribers base also.

It proves that there was some mishap during the spectrum & license allocation in 2008. It also says that UPA Govt. did not work properly to get more earning by selling mobile licenses, which was earlier denied by present telecom minister Kapil Sibbal (zero loss). Blaming NDA Govt does not work here.

New Operators who grabbed licenses in 2008 are in big trouble. In 2008 Uninor, Sistem/MTS, Loop, Videocon, Tata Docomo (GSM) and Cheers emerged as new players. SC says with the old license operators can operate for 4 months. During this period TRAI and DoT will come up with some decisions for fresh issue of licences.

It is expected some operators like Cheers, Videocon, Loop and STel who did not invest much on business may leave the sector completely or partially but new Telecom Policy is still atleast 5 months away. But may be TRAI will come up with some rules to exit the market.

‘Shocked’ Uninor reacts that they are unfairly treated and expects ‘the authorities to ensure that our 36 million customers, 17500 workforce and 22,000 partners are not unjustly affected.’

Idea Cellular cites ” They have been unnecessarily been caught in this situation of cancelled licenses, just because the licenses were granted in January, 2008 which was as late as 18 months from the date of application. In fact, Idea Cellular had filed a Petition in TDSAT inter alia seeking to isolate our application from the 2007/08 applications, and thus requesting for priority under the then DoT policy of “first come first serve”.

Happier than ever incumbent operators – Airtel and Vodafone is in a position to have the most benefits. Idea Cellular is already in trouble with double licenses in certain circles as they acquired Spice Communications. Idea and Tata have issues with 5 and 3 circles respectively which I believe will be managed easily.

Reliance Communications clears the fact that they obtained license in 2001 and it will not have any impact on them.

This verdict hits the foreign investments in India as some of reputed MNC like Telenor, Etisalat, Sistema, BaTelCo invested in these new mobile operators. It simply goes very bad impression to overseas market. More importantly Russian Govt controlled Sistema and UAE Govt controlled Etisalat are also on the list, which will certainly impact on foreign direct investments in India.

End of low tariff era in India? For last few weeks incumbent players are singing chorus to hike the tariff. With new bidding of 2G spectrum, these old players can grab more spectrum as well as it gives more financial burden to new operators which may lead to tariff hike.

New operators like Uninor and Sistema-Shyam will be in the sector for sure, as they already invested a lot and have a stable subscriber base. But if they have to pay for new bidding the immediate impact will be on workforce to cut jobs.

Subscribers of new operators may have to migrate to other incumbent players and as usual has to be part of higher tariff rates.

Whatever it is coming, it will simply hit the ‘aam janta’ with tariff hike, problems faced with porting out and job loss while Govt will ‘just’ watch out incumbent players squeezing money from people.

Universal Mobile Charger

In partnership with many leading mobile operators and manufacturers, the GSM Association has announced a commitment to implementing a cross-industry standard for a Universal Charging Solution (UCS) for new mobile phones. The main objective is to adopt a common format for mobile phone charger connections and energy-efficient chargers, world-wide. The initiative aims at making chargers which have advantages like

• reduce standby energy consumption
• eliminate thousands of tonnes of duplicate chargers
• enhance the end-user experience for mobile customers

This has been further endorsed by the ITU also. The European Commission recently reached an agreement with major phone providers for the UCS to work with all data-enabled phones sold in the European Union.The product definition includes common power supply with a detachable cable based on USB-IF standards.

UCS advantage
UCS is based on a Common Power Supply (CPS) having atleast a 4-star or higher energy rating. It will meet all efficiency regulations. With UCS in place, fewer chargers need to be manufactured each year which helps in reducing greenhouse gases produced in making and delivery of the replacement chargers. The widespread adoption of a Universal Charging Solution (UCS) is expected to result in:

• up to 50% reduction in standby energy consumption
• elimination of up to 51,000 tonnes of duplicate chargers
• enhance the end user experience and simplify the charging of mobile devices

For the consumer, charging a mobile device will simplify the end-user experience. Consumers will be able to carry fewer chargers and charge mobile phones anywhere from any available charger. Consumers will also be able to re-use chargers even when they upgrade their phone or if they have different mobile phones from different manufacturers but still want to carry and use a single charger.

The inititative was launched in 2009 and the group expects a UCS world by 2012.

Mobile TV Technologies

It has been quite some time that we have seen some form of mobile TV or other. The technology has been existing for a while but has not matured yet. It is yet to find its foothold in many countries around the world. Mobile TV is expected to combine broadcast content with streamed and downloaded contents.

Mobile TV

Mobile TV means television contents that can be watched on small hand-held devices. It may be a pay TV service broadcast on mobile phone networks or received free-to-air via terrestrial television stations from either regular broadcast or a special mobile TV transmission format. Some mobile televisions can also download television shows from the internet, including recorded TV programs and podcasts.i.e. the content may be obtained either through an existing cellular network or a propriety network.

Standards

DVB-H (Digital Video Broadcasting - Handheld)

This is the major one of the mobile TV formats. DVB-H was formally adopted as ETSI standard as early as in November 2004. DVB-SH (Satellite to Handhelds), DVB-NGH (Next Generation Handheld) are possible enhancements to DVB-H, providing improved spectral efficiency and better modulation flexibility.

ATSC-M/H (Advanced Television Systems Committee - Mobile/Handheld)

This standard for mobile digital TV allows TV broadcasts to be received by mobile devices. ATSC-M/H is an extension to the available digital TV broadcasting standard ATSC A/53. ATSC is optimized for a fixed reception and uses 8VSB modulation.

MediaFLO 

This technology transmits video and data to portable devices. In the United States, the service powered by this technology is branded as FLO TV. Broadcast data transmitted via MediaFLO includes live, real time audio and video streams, as well as scheduled video and audio clips and shows. The technology can also carry Internet Protocol data-cast application data.

The Faster Internet

The Internet is founded on a very simple premise: shared communications links are more efficient than dedicated channels that lie idle much of the time. And so we share. We share local area networks at work and neighborhood links from home. And then we share again—at any given time, a terabit backbone cable is shared among thousands of users surfing the Web, downloading videos.. But there’s a profound flaw in the protocol that governs how people share the Internet’s capacity. The protocol allows you to seem to be polite, even as you elbow others aside, taking far more resources than they do.

You might be shocked to learn that the designers of the Internet intended that your share of Internet capacity would be determined by what your own software considered fair. They gave network operators no mediating role between the conflicting demands of the Internet’s hosts. The Internet’s primary sharing algorithm is built into the Transmission Control Protocol, a routine on your own computer that most programs . TCP is one of the twin pillars of the Internet, the other being the Internet Protocol, which delivers packets of data to particular

addresses. The two together are often called TCP/IP.

Forcing the way!

TCP routine constantly increases your transmission rate until packets fail to get through!Then TCP very politely halves your bit rate. The mechanism is termed "binary exponential back-off". What a name isn't it? All other TCP routines around the Internet behave in just the same way, in a cycle of taking, then giving, that fills the pipes while sharing them equally.

Fair play?

An equal bit rate for each data flow is likely to be extremely unfair, by any realistic definition. It’s like insisting that boxes of food rations must all be the same size, no matter how often each person returns for more or how many boxes are taken each time. But any programmer can just run the TCP routine multiple times to get multiple shares. It’s much like getting around a food-rationing system by duplicating ration coupons. This trick has always been recognized as a way to sidestep TCP’s rules—the frst Web browsers opened four TCP connections!

The solution!

There’s a far better solution- according to Bob Briscoe. It would allow light browsing to go blisteringly fast but hardly prolong heavy downloads at all. The solution comes in two parts. It begins by making it easier for programmers to run TCP multiple times—a deliberate break from TCP-friendliness. They set a new parameter—a weight—so that whenever your data

comes up against others all trying to get through the same bottleneck, you’ll a share of the total. The key is to set the weights high for light interactive usage, like surfing the Web, and low for heavy usage, such as movie downloading.

Imagine a world where some Internet service providers offer a deal for a fat price but with a monthly congestion-volume allowance. Note that this allowance doesn’t limit downloads as such; it limits only those that persist during congestion. If you used a peer-to-peer program like BitTorrent to download 10 videos continuously, you wouldn’t bust your allowance so long as your TCP weight was set low enough. Your downloads would draw back during the brief moments when flows came along with higher weights. But in the end, your video downloads would finish hardly later than they do today.

4G: The race of 2 Technologies

A long-term battle is brewing between two emerging high-speed wireless technologies, WiMax and Long Term Evolution (LTE). Each would more than quadruple existing wireless wide-area access speeds for users. Both are 4G technologies designed to move data rather than voice. Both are IP networks based on OFDM technology

The two technologies are somewhat alike in the way they transmit signals and even in their network speeds. The meaningful differences have more to do with politics - specifically, which carriers will offer which technology.

The Genesis

WiMax is based on a IEEE standard (802.16).It’s an open standard that was debated by a large community of engineers before getting ratified.The level of openness means WiMax equipment is standard and therefore cheaper to buy!

LTE or Long Term Evolution is a 4G wireless technology and is considered the next in line in the GSM evolution path after UMTS/HSPDA 3G technologies. LTE is espoused and standardized via the 3GPP or 3rd Generation Partnership Project members. 3GPP is a global telecommunications consortium having members in most GSM dominant countries.

LTE vs WiMAX

Whereas WiMAX emerged from the WiFi IP paradigm, LTE is a result of the classic GSM technology path. LTE is behind in the race to 4G with WiMAX getting an early lead with the likes of Sprint ClearWire and several operators in Asia opting to go with WiMAX in the near term. So where WiMAX has a speed to market advantage, LTE has massive adoption and GSM parenthood to back it up.

LTE will take time to roll out, with deployments reaching mass adoption by 2012 . WiMax is out now, and more networks should be available later this year.

Speed offered

LTE will be faster than the current generation of WiMax as per well known text books, but 802.16m that should be ratified this year, offers similar speeds.The speeds expected by both LTE and WiMax are hard to nail down primarily because the technologies are just rolling out. But many factors will have to be taken into consideration.Speed to an end user is also dependent on how many users are connected to a cell tower, how far away they are, what frequency is used, the processing power of the user's device, and other factors.

Who will win?

For end users, the current debate over WiMax vs. LTE is largely theoretical but is nonetheless important.Analysts see a clear dominance by LTE in a few years, since so many carriers are bound to adopt it. However, that won't serve every user or every company. It is still going to be a combination of technologies and developers, WiMax may be one of those; but not the only one!!!

Are we in a Telecom Crisis??

Telecom Market & Industry (Remind you to note difference) has grown up significantly in last decade. In fact, this growth has surpassed our expectations & even shadowed IT/BPO boom to some extent. It all started when every business conglomerate in India was thinking on same lines; to enter in telecom market in India. Telecom was thought to be golden goose. There’s one simple reason to that thinking: entry barriers were purposefully kept low.

I’m not talking about hardcore telecom focus businesses like Bharti Group. Bharti was just the right company at right time to enter telecom market. Soon to follow suit were BATATA (Idea) & HFCL. What you have to do is pay spectrum fees & buy license. Both were interlinked. The spectrum was bought at meager price & not at market price. Nor it was auctioned. Once you got the license to operate or trade frequencies, you can outsource network rollouts/billing machines/IT Infrastructure to specialized entities like Nokia/TeleCordia/IBM to manage your business. That’s high time for telecom managed services. All incoming calls on mobiles were charged heavily, outgoing were too expensive. Telecom players were happy. They were just looking at Cash flows & P&Ls.

Soon others saw the cash flows & profit margins in business. They applied to enter in the market. DoT agreed. Few new players entered with new perspective- bargain on low calling rates to gain attention and foothold. It was year 2000. Call rates dropped. People started purchasing mobiles. Companies started getting subscribers.

This process continued.  Anyone was little bothered about something of differentiation. Even likes of Airtel, Idea & Vodafone failed to impress with their offerings. ‘Call Rates’ was game changer. Companies simply loved the game. Growth was significant.

Lack of differentiation, low entry barrier, threat of substitute, Supplier overcrowding, over competition & market fragmentation all started turning negative for market. Even backend backbone was started appearing same.  Market started appearing dismal & over fragmented. Golden goose started losing shine.

Amid chaos, policy makers & officials in department played black game of spectrum trading inside. Policy makers appeared too powerful to stop. Spectrum was sold amid disputes; little was known about consequences.  It’s too much exploitation for golden goose to bear.

Nasty blow came when telecom operators reached rock bottom level of call tariffs. Cash flow which looked rosy some years back now became thorn in neck. Profits plundered. Growth diluted. Cash shrunk. Competition was too much to handle. Joy of running business was robbed off.

And now when realization came that telecom has become bad choice of investment, it was too late to cry foul. At first it might appear- all is well, but inside stories are hard to suppress. What is happening to companies like GTL, Reliance, BSNL & MTNL can be evident from daily results. Cash strapped companies started crying for help. Balance sheet was showing only losses.

Perhaps the saddest part is buyer’s/operator’s purchasing power, which has fallen significantly over past couple of years. And that’s what hampering entire market. Operators who are the nerve point of entire telecom ecosystem are in real trouble over cash forecasts & inflows. Moreover the subscriber growth, which was key driver of industry, started slowing down in past couple of months. What’s the hope?

I feel still there’s lot to come. If you look at popular ‘Dip’ curve by Seth Godin, I firmly believe that entire industry is in bad but common phenomenon called ‘Dip’. 

This is certainly not quitting point. Those who survive will thrive. But yes, there’s no forecast of how long this ‘Dip’ is going to last. It might span few months or may be few years as well. Longer the period, tougher the time to come. We have perhaps reached center of ‘Dip'. Hope lies on its shallowness now.

Source: Telecomblogs.in

What goes behind a cell phone call??

Look at this article by Cellphones.org