India’s mobile subscriber base reaches 919.17 million during Jan-March quarter Economic Times, August 1, 2012 The number of telephone subscribers in India increased from 926.53 million at the end of Dec-11 to 951.34 million at the end of Mar-12, registering a growth of 2.68% over the previous quarter as against 2.16% during the QE Dec-11, according to Trai’s Indian Telecom Services Performance Indicator report. This reflects year-on-year (Y-O-Y) growth of 12.41% over the same quarter of last year. The overall Teledensity in India has reached 78.66 as on 31st March, 2012. With 25.33 million net additions during the quarter, total mobile (GSM + CDMA) subscriber base registered a growth of 2.83% over the previous quarter and increased from 893.84 million at the end of Dec-11 to 919.17 million at the end of Mar-12. The year-on-year (Y-O-Y) growth rate of Wireless subscribers for Mar-12 is 13.26%. Wireless Teledensity increased from 74.15 at the end of Dec-11 to 76.00 at the end of Mar-12. Wireline subscriber base further declined from 32.69 million at the end of Dec-11 to 32.17 million at the end of Mar-12, bringing down the wireline Teledensity from 2.71 at the end of Dec-11 to 2.66 at the end of Mar-12. Internet subscribers increased from 22.39 million at the end of Dec-11 to 22.86 million at the end of Mar-12, registering a quarterly growth rate of 2.10%. Top 10 ISPs together hold 94.94% of the total Internet subscriber base. Number of Broadband subscribers increased from 13.35 million at the end of Dec-11 to 13.81 million at the end of

Mar-12, registering a quarterly growth of 3.44% and Y-O-Y growth of 16.18%. Share of Broadband subscription in total Internet subscription decreased from 59.6% at the end of Dec-11 to 60.4% at the end of Mar-12. 85% of the Broadband subscribers are using Digital Subscriber Line (DSL) technology. Monthly Average Revenue Per User (ARPU) for GSM service increased by 1.66%, from `96 in QE Dec-11 to `97 in QE Mar-12, with Y-O-Y decrease of 2.71%. 10. MOU per subscriber per month for GSM service slightly increased by 4.10%, from 332 in QE Dec-11 to 346 in QE Mar-12. The Outgoing MOUs (167) increased by 3.98% and Incoming MOUs (179) by 4.20%. Monthly ARPU for CDMA, full mobility service increased by 2.49%, from `73 in QE Dec-11 to `75 in QE Mar-12. ARPU for CDMA has increased by 14.54% on Y-O-Y basis. TCS Insight: Many obituaries have been written about the Indian telecom industry both by the international and the domestic media – thereby keeping sentiments within the industry on a roller coaster. However, this has not affected the steady growth rate of this sector as shown by the numbers generated on reach, adoption and company profitability. With the re-auction of spectrum in the coming months (which will hopefully bring in new international entrants), the Indian telecom industry may soon recapture some of its lost glory. Canadian companies operating in the telecom space, and actively looking at expanding internationally should look at the Indian market.

August 2012 Contact: india.commerce@international.gc.ca

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EGoM suggests Rs14,111 cr as base price for 2G spectrum auction Indian Express, July 24, 2012 The Empowered Group of Ministers (EGoM) on telecom which has the responsibility of setting norms for spectrum auction is learnt to have recommended a 20% lower base price at Rs 14,111-15,111. The EGoM has suggested a base price between Rs 14,111 - Rs 15,111 crore for 5 Mhz of airwaves in auction. The mobile phone companies were demanding an 80% reduction from the Rs 18,111 crore proposed by Trai. According to ET, the panel of ministers is also learnt to given two options to the Cabinet on the spectrum usage charge, which forms part of the revenue share for mobile phone companies. The first option is to keep this levy at 5% of the telco's annual revenues, or calculate this levy as per the current rules. New entrants and companies that lost their mobile permits due to the Supreme Court can bid for a maximum of 6.25 MHz of airwaves in the 1800 MHz band in the upcoming auctions, while existing operators or incumbents, in the GSM space can bid for a maximum of 2 blocks or 2.5 MHz of airwaves. EGoM has suggested to fix 1.3 times of this price as minimum price for companies that may bid for airwaves that are being used for providing CDMA services at present. But the major telcos are not happy with the development. "The discrimination between GSM and CDMA is being further widened by keeping the auction reserve price for 800 MHz at 1.3 times of 1800 MHz on the rationale that less than 5MHz is being put up for auction. A similar option is not being extended to GSM operators to retain their 900 MHz spectrum at a price of 1.3 times of 1800 MHz, in the event that less than 5MHz is obtained at the time of the licence extension," the Cellular Operators Association of India said in a statement on Monday. "It is saddening to know that EGoM has not given due consideration to the fundamental issue of unsustainable high reserve prices which will significantly increase costs, thereby invariably increasing the tariffs," said COAI's Director General Rajan S Mathews. Reacting to this GSM industry body Cellular Operators Association of India said,"A similar option is not being extended to GSM operators to retain their 900 MHz spectrum at a price of 1.3 times of 1800 MHz," Mathews said. Association of Unified Telecom Service Providers of India (AUSPI), which represents CDMA players, said that the reserve price should be kept at Rs 3,500 crore for 800 Mhz spectrum band.

"Common man wants simple 2G services. There is no need to liberalise spectrum in 800 Mhz band as there are hardly any takers for airwaves in these frequencies. Liberalised spectrum will raise the tariff and take telecom services out of reach of common man," AUSPI Secretary General SC Khanna said. The EGoM is likely to meet tomorrow. TCS insight: The second wave of telecom reforms did not take off as expected due to the alleged 2G scam. With the upcoming re-auctioning of spectrum, the government is trying to bring impetus back into the sector. However, analysts and associations are wary of the high base price set for spectrum and are predicting an increase in the price of telecom service offerings. This potentially could be a setback for the government, which has been putting emphasis on bridging the urban - rural digital divide and on increasing rural penetration. Either way, this announcement opens business avenues for Canadian companies supplying equipment, services, and technology to mobile operators and who would be interested in supplying to companies who eventually win these licenses.

Bharti Infratel, OMC to set up telecom towers using green energy solutions Economic Times, August 2, 2012 Bharti Infratel, Bharti Airtel's tower arm, on Thursday said that OMC Power, a renewable energy service company, will set up micropower plants in Bharti Infratel's off-grid and poor grid telecom tower sites in rural areas using renewable energy sources. The initiative will complement Bharti Infratel's green initiatives called 'GreenTowers P7', under which the company is actively promoting use of renewable sources to power its towers, the company said in a statement. It said that this would help reduce the use of diesel-powered gensets currently used to power these towers. The financial details of the deal were not disclosed. "While great progress has been made in providing telecoms in rural areas, this has been largely achieved without grid-power availability, a key ingredient in providing telecom uptime to this critical infrastructure," Bharti Infratel Chief Technical Officer and Head of O&M Sairam Prasad said. "Our micropower plants have been designed specifically for rural areas. We have moved power from capex to opex and can supply more electricity at a better price than operators can by doing it themselves," OMC Power co-founder and CEO Anil Raj said. Bharti Infratel currently has over 33,000 towers, of which nearly 9,000 are in off-grid/poor grid locations.

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Following successful joint trials, OMC has already built the first micropower plant in Uttar Pradesh as part of the 10-year agreement. TCS insight: This latest "going green" initiative has been adopted by telcos, and most all of them are looking at new environmental technologies to reduce their carbon footprint and operating costs. Canadian companies with technologies that can help telcos to reduce their power and other consumables may find opportunities with Indian carriers. _________________________________________ Qualcomm Ventures to invest more in India Business Standard, July 26, 2012

Bangalore: Qualcomm Ventures, the venture capital arm of chip maker Qualcomm, plans to increase the pace of its investments in India. The company, which has invested in about 10 technology ventures in the country, feels the sky-rocketing mobile penetration is a window of opportunity.

“3G is slowly picking up in India and as phone prices are coming down, smartphone penetration is increasing,” said Kartheepan Madasamy, senior director (India and Israel), Qualcomm Ventures. “This will be a big growth driver for companies offering mobile platforms. The companies are evolving beyond the value-added services segment to broader application platforms. Currently, we are investing in about two companies every year. However, the pace would increase with the rise in mobile internet users.”

According to a Telecom Regulatory Authority of India report, as on March 31, 2011, 381.4 million people accessed the internet through mobile phones, while the country’s internet subscriber base for narrowband and broadband stood at 19.67 million.

“We operate from our balance sheet and began our operations with $500 million for creating successful ventures in the mobile space,” said Madasamy. “Our focus is to make the mobile ecosystem grow. If we want to create an ecosystem, innovation is the key. This

happens only in start-ups. We invest in start-ups focused on mobile technologies and mobile internet areas.”

Qualcomm Ventures’ portfolio companies in India include Apalya, Capillary Technologies, MapMy India, Obopay and Onward Mobility. Recently, along with Fidelity Growth Partners, it invested about $20 million in online wholesale cash-and-carry company Big Shoe Bazaar, whose investors include Nexus Venture Partners and Narayana Murthy’s Catamaran.

“We believe even consumer internet sites would be largely accessed through mobile devices. Though we focus on mobile platforms and applications, people are going to access e-commerce sites through mobiles. This is why we invested in Big Shoe Bazaar,” Madasamy said, adding the company planned to invest $1,00,000-200,000 in each early-stage company as seed fund. It would also invest $3-10 million in early-stage companies.

According to Venture Intelligence, a research service focused on PE and mergers & acquisitions, Qualcomm Ventures accounted for 11 investments worth about $32 million in India, including multiple rounds of funding in the same company. Apart from direct venture capital investment, Qualcomm has another programme, the Q Prize India, through which it selects an innovative company and provides it convertible debt of $1,00,000. TCS insight: The explosion in mobile telephony adoption which happened between 2004 and 2006 is now expected to be replicated in the broadband Internet arena. With customer premises equipment (CPE) becoming cheaper and more affordable and many enabling wireless technologies available such as UMTS, 3G, LTE, and WIMAX, operators are focussing on increasing subscriber numbers and penetration as per the business model that made telephony popular. It is likely just a matter of time before broadband /mobile internet becomes the next success story of the Indian telecom industry. Canadian companies providing technologies and services in this space will see interest from established service providers and new companies which are planning to launch their services shortly. _____________________________________________

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