Telecom News / Views - 22-May

Bidding Strategies - Analysis by Business Standard

FCC Report on wireless and competition

Lightreading BWA Spectrum Bidding

Telecom / ICT News / Interesting Articles

Indian 3G Auction Details: http://www.lightreading.com/document.asp?doc_id=192180&

India Telecom Story : Post on WSJ

HBR's 2 articles on Ethics

Something different - Theft worth Euro 500Mn!

Telecom dynamics - Misc Links

Lightreading speaks about European market.

In the meanwhile, India starts its walk towards 4G.

Shyam Ponappa's thoughts on Alternative Scenarios in Indian telecom

How 2009 Went By? Part 1

As is the ritual, year endings are mandated with the lists of 10 somethings...top news, best, worst....

So here are the 2 telecom updates:
1) MBB on top 10 telecom news. 
2) Telecom M&A details from Unstrung - Check the AdMobile story in there. Interesting.

As I gather more such lists, I will either update this post or post next part.

Also posting these / some of these individually on twitter under #How2009Went. If you got any interesting ones, post in comments here or tweet them.

Telecom Market Evolution & Part 3 of Nortel's Story

Nortel has sold its GSM business. This article from LightReading summarizes the sales so far and the expected asset sales.

Telecom Market Discussion

Now check this article from Economist on forecasted mobile subscriber base. 2 things of note:

1. Check the forecast by 2011 when the mobile broadband subscriber base passes fixed broadband subscribers.

2.  The costing of the netbooks and other low cost computing devices meant to improve internet penetration.

Another point is that as 3G is made available across the world, the mobile eliminates the need of a separate computing device. This matters a lot to 2 types of subscribers - convenience oriented and cost oriented. The convenience oriented market has been more or less addressed.

The cost oriented ones are the ones that are forming a very large part of the mobile broadband forecast in the Economist article.

Finally, fixed broadband has a role to play in rural and other emerging areas. That is described in the intern-kiosk model that is there in Economist. And of course the folks who are already onto it in established markets.

3G in India...more discussion

Here is an article that discusses the role of rural market for 3G providers.

http://www.mobilebusinessbriefing.com/article/rural-areas-to-drive-indian-3g-growth

Interesting forecasts there.

As I had mentioned earlier, the recent cut in prices is probably a beginning towards the rates that will arise once 3G markets open. Since the rural areas still have potential, they need to be tapped. It is obvious that service providers would want to generate as much demand there as possible.

Going green - Smart power using wireless tech

Smart Grids are the talk of the town. The per capita consumption of power in developed nations is higher than that of developing / under-developed nations. The developed nations have been working with the idea of Smart Grids for some time now.

The idea here is to have smart devices and smart tariffing that encourage consumers to adjust consumption as per the overall demand of the city/area. For example, the price is high during peak hours. Something like airlines, most of whom demand more money when you book for weekend. You book a red-eye flight, you get lower fare...sometimes even a bump up to business class :)

And it is not only about tariffs. It is about intelligent management of power. For example, schools and offices close after 5pm....then the substations and other devices used by them exculusively can be regulated or switched off as and when the grid "detects" a drop below a certain level.

Some cities like Austin have been experimenting with this idea for sometime. Check this link which describes how operational expenses and other savings were effected through smart grid.

For example, reading meters wirelessly, communicating consumer needs are some of the examples of this case of use of smart grid.

The case of India

Indian power sector is reeling in crisis. Outages, T&D losses and theft are some of the perpetual pain points for India. At the moment the T&D losses are somewhere around 35% of the overall generation. The associated loss to output is also a definite worry.

Smart grids can address some of these issues. Use of wireless devices connected to central management systems can revolutionize this sector.

For example to reduce theft it can point to problem areas, generate alarms and flags when the consumption goes beyond set patterns etc. Also, an increase in regular consumption can also flag off the need of new equipment and tariff plans.

Check this NYT news piece and this interesting paper from WiFi alliance which NYT refers to.

The cost may be very high for countries like India but it should be considered in terms of direct losses mentioned above plus the opportunity cost in terms of lost business due to the above problems.

Interesting telecom blogs

Some very interesting telecom blogs

http://3g4g.blogspot.com/

http://developing-telecoms.blogspot.com/

http://comworldseries.blogspot.com/

http://www.mobilefuture.org/blog/

Telecom Market Dynamics - Part 2

I had written an earlier article on telecom industry and the recent market reaction.

This ET article is similar to what I had written earlier. Although, the difference is a slightly conservative conclusion. Only time will tell how things unfold.

Valuing Nortel's LTE Patents - Part 3

Nortel has come out with ~3400 patents. All About Nortel reports that these will be assessed for its value and the strategy for sale will be decided after their consultant provides inputs on the portfolio's potential.

As I had discussed in my earlier blogs, there are 2-3 methods to assess the value of the patents. Most probably it will be a mix of direct market potential and value of real option.

The older posts - Patent related post 1 and Patent related post 2.

Telecom stocks hammered - Why the haste?

Indian telecom stocks have been heavily hammered in the last few days. I was surprised.

Further to the pay-per-call, there was the 50 paise call and the discussion about possibility of mandate for per-call pulse that caused almost panic selling in the markets. It seems a hasty conclusion that all telecom is going to lose overall...

Following points need to be thought of in the context of Indian telecom scenario:
1. The ARPUs are falling but they still seem to be a function of the demand-supply equilibrium. Consider this, which markets are still untapped in India? Rural markets. The teledensity of rural ndia is far behind the urban. So the rural market is probably stimulated at a lower price and the industry is probably responding to that.

2. Commoditization is natural but this rural market would still allow the business to be a good business because of the volumes.

3. Now, in the recent times, operators have adopted several measures that are cutting costs like Infrastructure sharing, outsourcing their network operations etc.

If the operators are willing to pass this cost savings to customers, then that is actually good news for customers. Perhaps the demand generated by this will more than compensate the reduction in revenues.

4. The 3G scenario has still not even started. I am sure every operator definitely would have a strategy for 3G. They will find new ways to generate interest in 3G apps in the urban market. Particularly, business customers and the youth segment.

5. Operators are also trying to unlock value by spinning off businesses like tower business etc.

Considering this, I thought it was a little premature to assume that telecom story is over. I would rather wait and watch.