Telcos must increase tele-density: Minister

PUNE: Private players should play a major role in addressing the problem of low tele-density in India. "The telecom density during the time of Rajiv Gandhi was as low as 0.3 percent which has increased to 8.1 percent presently. With two million phones being added each month, a major portion of which are mobile phones, the private players have a major role in play in increasing the tele-density," added Union Minister of state, communication and IT, Dr Shakeel Ahmed. He was addressing the VII National Telecom Seminar Communiqué 04 organized by the Symbiosis Institute of Telecom Management (SITM) at Pune.

According to him, the formulation of any strategy in India should be aimed at breaking the vicious circle of poverty, low productivity, illiteracy and health and herein lies the criticality of telecom services. "In the developed countries, an increase in the tele-density by 10 percent leads to an increase in GDP by 3-3.5 percent," he said.

Ahmed also released the white paper of Telecom Forecast 2005 at the seminar held on `Strategies and Opportunities in a Consolidating Telecom Industry'.

TDSAT chairperson Justice DP Wadhwa, who spoke on `Dispute Resolution Mechanism in the Telecom sector' at the two-day seminar, underlined the necessity for disputes to be settled in time.

"With the amendment of the regulatory act in the year 2000 for the disputes of the cable industry, TDSAT has been stormed with cases," he said. TDSAT comprises of members from various streams. It is a member of the International Telecom Union (ITU), which is also a regulatory body.

Justice Wadhwa emphasized the need for consumers to be more active to file complaints. He said that TDSAT imposed heavy cost to the disputing parties like big service providers, the funds of which are used for the benefit of general consumers. "What is more important is that we work freely and so does TRAI," he added.

TRAI member Dr DPS Seth, in his address, said that the regulatory framework needed to be redefined. "For dealing with regulatory challenges, legacy framework was structurally rigid and information services sector was traditionally untouched," he pointed out."Spectrum has to be used effectively and efficiently. Neither the government nor the regulatory authority should tell the service provider which technique to follow," he added.

TTSL chairman Firdose Vandrevala stressed on the Porter's marketing strategy for consolidation. Discussion on issues in consolidation encompassed three major points viz cost leadership, product innovation and customer. "Creative segmentation and innovation has become the key to strategy, since strategy drive policy and policy in turn drove strategy," he said.

USO Fund administrator Shyamal Ghosh said that the companies should bring about innovative packaging of tariffs, transparency in billing avoiding any hidden agenda so as install confidence, innovative extension of network, i.e., Wi-Fi, bluetooth, broadband policies penetrating the rural market accessibility and develop universal services infrastructure for all the villages in the country. Together with this, companies can outsource service value chain to competent providers, he said.

He also believed that telecom operators should provide vanilla services for the mass market and lots of frills for nice markets. " Customers want end to end solutions so the transition would be from EVDO, GPRS, EDGE to higher third generation technologies. USO Fund is willing to support capital and operating expenditures in the untouched rural telephony market, " Ghosh said.

Motorola operations director Subhendu Mohanty focused on the emerging business area of managed services in the telecom sector. According to him, the key drivers for outsourcing include focusing on the core competency, reduction and control of operating costs. "This in turn would help achieve economies of scale. The top-most priority sectors in outsourcing include installation and maintenance, engineering, operations and this outsourcing is mainly done by companies in mature markets, which are now focusing on open reduction," he added.

Reliance Info (GoH) president Prakash Bajpai spoke on broadband penetration in the country. He said, "The services that would nurture broadband explosion would be ERP, automation, e learning, video conferencing, CRM, virtual office and HDTV".

Tata Strategic Management Group telecom practice head Ankur Jindal spoke on inorganic growth and strategies. He emphasized upon a suitable regulatory environment and applications for operators to maximize efficiency and output.

On the second day of the event, in the telecom financing session, JP Morgan India VP Kaustubh Kulkarni gave insights on the topic `Company valuation' and Lazard India corporate finance director Suresh Goyal shared his views on corporate financing.

In the panel discussion on `Frequency Mismatch', GSM India Spectrum Working Group chairman and Nokia Sr Advisor JP Garg said there should be proper utilization of available resources by both CDMA and GSM.

AUSPI secretary general SC Khanna pointed out that providing 1900 MHz to CDMA was in line with international standards and was important to continue competition at low prices. According to Qualcomm India president Kanwalinder Singh, since the issue was technical, solution providers coming up with new compatible technologies would best solve the problem.

GSA India chairman A Sethu Raman opined that the GSM technology was here to stay and it would take time for CDMA counterparts to catch up with them. LG CDMA Terminal VP K Kushwaha voiced his concerns for CDMA players. COAI director general TV Ramachandran said that the issue stands weak when the CDMA operators were not utilizing their allocated capacity in 800 MHz.

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