Comviva, formerly known as Bharti Telesoft, has launched the virtual SIM and handset concept in Cameroon eight months ago, which is likely to increase mobile penetration like never before, helping people without the financial ability to afford a handset, to have mobile connections.
In the 21st century, mobile telephony is scripting a new chapter that underscores its billing as the economic change agent for under-privileged masses in Cameroon. A virtual mobile SIM works this way: a potential user approaches any mobile operator, registers for a SIM and is allotted a number. The user can top up that number by an affordable amount and receive or make calls from any phone. The user can also have all other facilities like SMS, content, weather updates or any other value-added service as in any regular mobile connection.
Once the virtual number is inserted into any handset, the user’s ‘personality’ resides in the gadget as in a dual SIM format, and the user can receive or make calls from that handset. Once a call gets ended, it depends on the users to delete the number residing in that handset, or retain it there if more calls are expected on that handset.
Sangeet Chowfla, Chief Strategy Officer of Comviva says, “The concept dramatically increases the affordability of a mobile connection for the economically underprivileged. For someone with a low disposable income, the cost of even a $50 handset can mean 180 days’ savings. The virtual SIM concept can cut that by a factor of six.”
This concept was introduced with an aim of catering financially marginalized population, but later on it has also appealed to unintended user groups, including businessmen who prefer to have a different SIM to use while speaking to a certain group of their contacts, and youngsters who prefer to have dual numbers to interact with different friends’ circles.
The virtual SIM is being considered as a boon for low-income families that cannot afford multiple handsets. Family members can top up their personal virtual numbers with payment upfront, feed their numbers into the common handset and receive and make calls from the same handset without having anyone else to bear the tariff for their personal usage.
Success in the Cameroon venture, where virtual SIM users are learnt to be making five million calls per month, has stirred Comviva to launch the facility in partnership with local operators in different markets, with East Africa, Bangladesh and India to be the early markets for launch.
Indian telecom industry has not been impacted much by global economic slowdown and many new vendors see this as opportunity to enter Indian telecom space. With the 3G auction around the corner, 27 new handset vendors have entered the market in just one quarter, according to Economic Times.
These new mobile companies are coming up with dual SIM cards, full Qwerty keyboard and at a cheaper price to attract more customers. Mobile handset sales in India recorded a 6.7 percent increase to 100.9 million in the year ended June 30, as compared to 94.6 million in the year before. Even Mindtree has entered the telecom space through its acquired company Kyocera Wireless. China Wireless Technologies’ Indian subsidiary, Coolpad Communications, is targeting Rs. 800 crore revenue in next five years in India. The company is set to invest Rs. 400 crore as capex and opex over the next three years.
According to a new research study by IDC India, the new vendors have ensured that the overall mobile handset shipments touched 6.3 percent as compared to 1.2 percent during the June 2008 quarter, when the new vendors totaled 11 percent. “The shipments from such new players who have entered the Indian market in the last 12 to 18 months grew six-fold with 6.41 million unit sales,” said Deepak Kumar, Associate Vice-President (Research) of IDC, India.
In terms of shipment, Nokia still leads the market share in India with 56.8 percent followed by Samsung with a 7.7 percent share and LG with 5.4 percent share in the 12-month period ended June 30, according to the report. ‘With the mobile handsets market in India growing in volumes , device manufacturers have started focusing on niche and emerging segments based on lifestyle profiling of buyers ,” said Naveen Mishra, an Analyst at IDC India.
“We see the market getting further crowded. At the same time, an accelerated evolution of the market is at work, as rising competition forces vendors to offer a combo of volume and value,” said Kumar.
Is Google Voice a traditional phone service or a Web application that in no way competes with LECs? That’s the question that lies at the heart of the Federal Communications Commission probe of the service, and the subject of much opining since the FCC launched its probe on Friday. Google was quick to weigh in on the matter.
The FCC wrote a letter to Google Inc. after a bipartisan group of lawmakers requested the probe, and after AT&T Inc. lodged a complaint claiming Google Voice has an unfair advantage over traditional companies by being able to block calls to some rural exchanges that charge high, margin-killing termination rates. Phone companies in contrast are banned from all call-blocking – a policy AT&T itself has protested many times. This is an issue, AT&T argued, because Google Voice should be seen as a competitive threat to regular calling services, and subject to the same regulations.
AT&T Senior Vice President Robert Quinn said: “Google casually dismisses the bureau’s order, claiming that Google Voice ‘isn’t a traditional phone service and shouldn’t be regulated like other common carriers. But in reality, Google Voice appears to be nothing more than a creatively packaged assortment of services that are already quite familiar to the commission.”
That’s a claim Google has now refuted resoundingly, answering the FCC with a statement claiming that Google Voice is not a phone service. Rather, it enhances existing communications by offering a single portal through which to access those landlines, mobiles, IM, texts and other modes. Google’s Richard Whitt, senior counsel, also noted that AT&T and other LECs charge for their services and are the beneficiaries of Universal Service Fund subsidiaries. In contrast, Google Voice is a free application that cannot afford to remain so if it must pay “exorbitant” termination rates for calls to certain exchanges.
Those exchanges, Whitt argued, have higher-than-usual termination rates because they have profitable relationships with adult chat lines and free conference calling services. The result is a large amount of expensive traffic. That reality, Google said, arises from outdated carrier compensation rules that should be fixed.
Depending on the FCC findings, the case could result in any number of free Web services, like Skype, for instance, being regulated as traditional landline or mobile services. That’s a turn of events that Whitt warned would end up slowing innovation significantly. AT&T in turn looks at it as leveling the playing field. Free IP-based services have been steadily cannibalizing a segment of its bread-and-butter voice services, helped along by a lack of competitive regulation.
In its letter, the FCC asked Google to answer some questions by Oct. 28, including how Google thinks the service should be regulated, why there’s an invitation-only policy for the trial service, and how Google decides what calls to block and how it blocks them.
source: VON Magazine
Posted October 15, 2009on:
Cisco yesterday announced it is buying mobile packet core specialist Starent Networks for US$2.9 billion (US$35 per share). The price represents a premium of 21 percent over Monday’s closing share price. Founded in 2000, Starent completed an IPO in 2007 and reported revenue of US$254.1 million last year, a 74 percent improvement on the year prior, and net income of US$60.5 million. Earlier this year Starent scored a major win with US operator Verizon Wireless for deployment of LTE networks. Cisco expects the Starent deal to close in the first half of calendar year 2010. Upon completion, Starent will become the new Mobile Internet Technology Group led by Starent’s president and CEO, Ashraf Dahod, within Cisco’s Service Provider Business which is led by Pankaj Patel.
The move comes only days after Cisco announced the US$3 billion acquisition of Norwegian video conferencing specialist Tandberg. At the time, Cisco chief executive John Chambers said the firm would be “more aggressive” over the next 12 months in pursuing other acquisitions.
- Enters into sale agreements for Optical Networking and Carrier Ethernet Businesses with Ciena for US$390 million in cash and 10 million shares of Ciena common stock
- Agreements include the planned sale of substantially all assets within the Optical Networking and Carrier Ethernet businesses globally
- Sale of businesses is best path forward for the future of Nortel’s Optical Networking and Carrier Ethernet customers and employees
Today is a significant day for Nortel Metro Ethernet Networks. Nortel announced that it has entered into a “stalking horse” asset sale agreement with Ciena for its North American, Caribbean and Latin America (CALA) and Asian Optical Networking and Carrier Ethernet businesses, and an asset sale agreement with Ciena for the Europe, Middle East and Africa (EMEA) portion of its Optical Networking and Carrier Ethernet businesses for a purchase price US$390 million in cash and 10 million shares of Ciena common stock.
You can find the news release on Nortel.com by clicking here.
These agreements include the planned sale of substantially all the assets of the Optical Networking and Carrier Ethernet businesses globally. If successfully completed, this transaction with Ciena:
- Provides for the transition of substantially all of Nortel’s Optical and Carrier Ethernet customer contracts.
- Includes substantially all of Nortel’s Optical and Carrier Ethernet product portfolio and related services business, including the OME 6500, OM 5000, CPL, and all other optical/Carrier Ethernet platforms, as well as our industry-leading 40G/100G technology.
- Includes all patents and IP that are predominantly used in the Optical and Carrier Ethernet businesses.
This transaction will not include the Nortel Multiservice Switch (MSS and formerly called Passport) business. There are no changes to Nortel’s plans to develop the MSS platform and actively support our broad base of MSS customers globally. The MSS business remains a strong, profitable contributor to Nortel’s overall business.
We believe that today’s announcement provides a step towards clarity for our customers, and is the best path for Nortel to preserve the optical innovation and customer relationships that we’ve built as a leader in the optical industry over the last two decades.
This transaction is subject to a court-approved “Stalking Horse” process (or 363 Sale) that allows other qualified bidders to submit higher or otherwise better offers. We will endeavor to complete this transaction as expeditiously as possible. If Ciena emerges as the successful bidder, under the terms of Ciena’s “stalking horse” bid, we would target being in a position to close the sale in Q1 2010 provided all court, regulatory and other closing conditions have been met.
Source: Nortel’s Analyst Communication
Debt ratings agency, Fitch says that it expects the recent tariff war by new telecom entrants in India and the likely retaliation by incumbent operators, will have a significant impact on industry revenues and profitability.
The reduced tariffs will lower the ARPUs and operating margins for all industry players. In a recent report, Fitch stated that EBITDA margins of existing operators will fall on lower ARPUs in the near term. The exaggerated tariff reduction and competitive intensity will likely reduce ARPUs by 10%-15%, which is lower than expected.
The Indian telecom industry is witnessing price wars with the entry of the new telecom operators, which were allotted universal access service licenses (UASLs) in February 2008 by the Department of Telecommunication (DoT).
The new entrants (Aircel, Sistema Shyam Teleservices (SSTL) and Tata Docomo (GSM)) have launched aggressive tariff plans in an effort to garner subscriber market share. These new entrants have launched per second billing, either selectively or throughout their networks, while Tata CDMA has launched tariffs on a per call basis, irrespective of duration (Re 1 and Re 3 per call on local and STD, respectively). Following this trend, Reliance communication (Rcom) has reduced the tariff to 50 paise per minute for local, STD, roaming and SMS, for both off-net and on-net calls. BSNL has also launched per second billing plan in Karnataka, Andhra Pradesh and Orissa.
Fitch expects other incumbent operators to eventually match the reduced tariff plans, considering the adoption of mobile number portability in the near future.
Nevertheless, Fitch expects the Stable Outlook of the sector to continue, given the net monthly subscriber additions. However, the impending 3G and BWA auctions remain an event risk.
Fitch expects subscriber growth to be at a CAGR of 25%-30% over the next three years up to FY12, as compared to a CAGR of 44% in the last three years (FY07- FY09). The incumbent operators with strong balance sheets and strong portfolio of high-end customers in metro areas are expected to maintain their credit profile. However, Fitch expects new entrants to face increasing difficulties in garnering any meaningful market share, with already low tariffs leading to lower ARPUs, a lack of adequate spectrum quality and restrictions on spectrum sharing.
The telecom industry has yet to see service launch of other UASL holders like Etisalat DB Telecom India, Datacom, Telenor – Unitech wireless, Loop Telecom and S-tel. Fitch believes that the reduced industry profitability will likely expedite industry consolidation in the medium to long term.
Source: Fitch Ratings
Mobile advertising market is emerging as a huge growth area with the rise of web phones like the iPhone, Android, Blackberry and Palm. According to the Kelsey Group, a market research firm, the mobile advertising market will balloon from $160 million in 2008 to $3.1 billion in 2013.
Of course, that is just an educated guess which will turn out wrong. But there is no doubt that mobile advertising will be much bigger in four years, perhaps even ten to 20 times bigger than it is today.
Where will all of that mobile ad money go to? Display ads are projected to go from 13 percent of the total to 18 percent, while SMS ads will decline as a percentage from 63 percent to 9 percent (see charts). So once again it looks like search is going to be the big winner. No wonder Google is so focused on mobile search as one of its major sources of growth.
Think about it. Display ads take up precious real estate on your phone screen and tend to just get in the way and be an annoyance. That’s whymost people don’t like them . But when you are doing a search on your phone, you are often looking for something nearby?a store, a restaurant, a dry cleaner. You are more open to ads, especially if they are relevant to your search. As reported by TechCrunch, the Kelsey Group also projects that mobile search will go from 24 percent of the total mobile ad market last year to 73 percent of the much larger pie in 2013, according to a recent research note put out by Citi Analyst Mark Mahaney. He said that Mobile search is particularly tuned for local search ads. “Given the nature of mobile devices, local queries on mobile should, over time, be greater than local queries on the desktop,” he added.
Indeed, the Kelsey Group predicts that local searches will rise from 28 percent of all mobile searches in 2008 to over 35 percent by 2013. And as a percentage of mobile search ad revenues, local search is already half so that it will be a $1.27 billion market opportunity in four years just for local mobile search.
Source: Silicon India, Washington Post