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Tag: Reliance Communications

  • DoT moves Supreme Court to secure dues worth Rs 33,000 cr

    DoT moves Supreme Court to secure dues worth Rs 33,000 cr

    MUMBAI: A recent move from the Department of telecommunications (DoT) may push telecom players in the country deeper into trouble. According to a report from Economic Times, DoT has moved the Supreme Court for approval to secure dues worth almost Rs 33,000 crore from all operators. The department in favour of the move has argued that existing bank guarantees aren’t enough to cover the “huge public money” at stake.
    According to the report, DoT(http://www.indiantelevision.com/regulators/trai/trai-stands-up-to-dot-on-use-of-foreign-satellites-for-comms-services-on-aircrafts-180605) filed two petitions pleading the court to ensure that the “government’s interests are secured”. In the separate but identical petitions, they claimed that fresh bank guarantees for Rs 28.70 crore and Rs 32,655.58 crore are needed from the operators.
    DoT(http://www.indiantelevision.com/regulators/ib-ministry/dot-seeks-views-on-blocking-mobile-apps-like-fb-whatsapp-180807 )said in the petitions that it is “not adequate security towards its outstanding assessed annual license fee and SUC dues” even with existing financial bank guarantees and withholding the performance bank guarantee of the licensee companies.
    Telcos think it will increase the financial burden on them if the court speaks in favour of the petition.
    Shares of telecom companies including Bharti Airtel, Vodafone Idea, Reliance Communications and Tata Teleservices (Maharashtra) plunged up to 6 per cent in morning trade following the move of DoT.
    Reliance Communications would be in deep trouble as it is already debt burdened. Any decision favouring DoT could add to its financial liabilities which could lead to delay of the sale of its spectrum to Reliance Jio.

  • Anil Ambani to exit telecom business; focus on real estate

    Anil Ambani to exit telecom business; focus on real estate

    MUMBAI: The 14th AGM of Reliance Communications, promoted by Anil Ambani, saw confirmed talks of Anil Ambani’s exit from the telecom business. He said that Reliance Communications will concentrate majorly on real estate in the future.

    Founded 15 years ago on 27 December 2002, Reliance Communications was referred to as the vision of Dhirubhai Ambani, the father of Anil and Mukesh Ambani.

    At the 14th annual general meeting, Anil said that the first priority for RCom, credited for democratising telecom services through cheaper offers in the early 2000s, was to resolve its debt worth over Rs 40,000 crore.

    Pointing to the 133-acre Dhirubhai Ambani Knowledge City (DAKC), the headquarters of Reliance Communications, on the outskirts of Navi Mumbai, Ambani said that there was a huge realty play opportunity that erstwhile corporate headquarters possesses.

    He pegged the potential value creation from such sites at Rs 25,000 crores.

    According to the reports, Ambani said, “We have decided that we will not proceed in this sector. And many other companies have taken a similar call. This is very much writing on the wall. As we have moved out of the mobile sector, we will monetise at an appropriate stage our enterprise business. Reliance Realty will be the engine of growth for the future of this company.”

    Looking at the telecom sector, he said that there has been a “creative destruction” of the telecom sector that has resulted in creation of oligopoly, which is going towards a duopoly and maybe even a “monopoly in the future”. Banks are saddled with over Rs 7.7 lakh crore in debt and the financial troubles of operators have resulted in over 20 lakh job losses, he said.

    Post discontinuation of the telecom business, Ambani said the residual business would be the enterprise, data centres, undersea cables and international voice calling verticals etc that are expected to serve some 35,000 businesses. He said half of the revenues from this line of activity will be from overseas. But Ambani said that his company was “committed” to exit even those verticals, to pay-off banks. A decision in this regard will be taken “at an appropriate time,” Ambani said.

  • RCom sells assets worth Rs 2000 crore to Reliance Jio

    RCom sells assets worth Rs 2000 crore to Reliance Jio

    MUMBAI: Reliance Communications has completed the sale of its media convergence nodes (MCNs) and related infrastructure assets worth RS 2000 crore to Reliance Jio Infocomm (Jio). The received amount will be the first tranche of payment in the Anil Ambani-owned operator’s asset sale which is sinking in debt of Rs 46,000 crore.

    Following the completion of MCN monetisation transaction, 248 MCNs covering 5 million sq ft of area used for hosting the telecom infrastructure were transferred to Jio. During early trade, shares of RCom were up by 1.97 per cent at Rs 19.14 on BSE.

    The debt-laden company expects to raise about Rs 18,000 crore by selling the wireless assets to Jio and real estate assets to Canada’s Brookfield. The company also said that it would sell an additional 65 MHz spectrum in the 800 MHz band to Jio for Rs 3,500-3,700 crore. Last year, the company shut down its wireless services.

    Back in May, the Competition Commission of India (CCI) cleared the proposals for the sale of assets of Reliance Communications Ltd to Jio.

  • Reliance Jio acquires RCom’s wireless infra assets

    Reliance Jio acquires RCom’s wireless infra assets

    Mumbai: Reliance Jio Infocomm Ltd (RJio), a subsidiary of Reliance Industries Ltd (RIL), today signed a definitive agreement for the acquisition of the wireless infrastructure assets of Reliance Communications Ltd (RCom).

    An asset monetisation process for RCom assets was mandated by the lenders of RCom, who appointed SBI Capital Markets Ltd to run the process. The process was supervised by an independent group of industry experts. RJio emerged as the successful bidder in the two-stage bidding process.

    Consequent to the agreement, RJio will acquire assets under four categories–towers, optic fibre cable network, spectrum and media convergence nodes from RCom and its affiliates. These assets are strategic in nature and are expected to contribute significantly to the large scale roll-out of wireless and fibre to home and enterprise services by RJio.

    The acquisition is subject to receipt of requisite approvals from governmental and regulatory authorities, consent from all lenders, release of all encumbrances on the said assets and other conditions precedent. 

    Consolidation has been the buzzword in the telecommunications industry. From as many as 13 players at one point in time, we are now left with just four major contenders.  Earlier this year, Vodafone India and Idea Cellular decided to merge operations to create India’s largest telecom operator worth more than $23 billion beating Sunil Bharti Mittal-led Airtel. 

    RJio is being advised by Goldman Sachs, Citigroup Global Markets, JM Financial Private Limited, Davis Polk & Wardwell LLP, Cyril Amarchand Mangaldas, Khaitan & Co and Ernst & Young on this transaction.

    Also Read:

    The year the telecom sector quaked

    Jio continues leading broadband subs addition while wireline internet loses subs in Oct

  • Four telcos will emerge from India consolidation, predicts CCS Insight

    MUMBAI: On 27 June, global analyst firm CCS Insight announced the launch of its new report focused on the development of the Indian telecom industry.

    The report – India: Halcyon Days Ahead in a Four-Operator Market – highlights the history, dynamism and consolidation of the Indian telecom market, revealing that:

    A total of 68 per cent of leading telecoms executives surveyed predict that India will consolidate to a four-operator market

    Just over half of respondents to a CCS Insight survey think that Vodafone will still be operational in India in five years’ time
    Market consolidation will be a positive outcome for network operators, consumers and manufacturers of infrastructure and handsets
    India’s population of more than 1.25 billion people represents an enormous market for mobile communications. It has attracted billions of dollars of investment from domestic and international companies over the past 20 years and, with the consolidation process in India now moving at a rapid pace, it has the potential to bring an end to two decades of market chaos.

    The report is written by CCS Insight senior adviser Tony Worthington, the former Global Head of Telecoms, Media and Technology at Standard Chartered Bank. Tony has been involved in the Indian telecoms industry for over 20 years.

    He notes that “the consolidation process in India is now well under way, and the main uncertainty seems to be whether the Ambani brothers — one of whom owns Reliance Communications, and one of whom owns Jio – will be able to live with a merger between the two companies. Most of the survey sample seems to think that, ultimately, they would”.

    CCS Insight CEO Shaun Collins adds, “This report provides some interesting thoughts for consumers, handset providers and mobile operators in India. Consolidation is a reality for operators across the globe and there’s a history of instability in the Indian market, so we’re excited to see the growth and evolution of this sector. CCS Insight looks forward to working with its valued clients in considering the future implications of consolidation in India, fuelled by the mergers of Vodafone and Idea Cellular, Reliance Communications and Aircel and by the ambitions of Jio”.

  • Star Den, Flag Telecom, You & Idea FDI meet on 28 Dec

    Star Den, Flag Telecom, You & Idea FDI meet on 28 Dec

    MUMBAI: The foreign investment board will consider 17 foreign investment proposals on 28 December, including that of Star Den Media Services and others.

    Star Den Media Services Pvt. Ltd. develops and distributes television, cable, and the related network platforms. It offers a platform for distributing television channels in India through all fixed networks including cable, direct to home, and internet protocol television.

    Other investment proposals include that of Idea Cellular Infrastructure Services, Flag Telecom Singapore Pte Ltd and You Broadband India.

    FIPB had in June this year rejected a proposal of Flag Telecom Singapore, a wholly-owned unit of Reliance Communications (RCom), to set up a telecom subsidiary in India. Flag Telecom reportedly planned to acquire a company, payout for which would have been around US$120 million — in two parts.

    Now, the Foreign Investment Promotion Board, helmed by the economic affairs secretary Shaktikanta Das, is planning to meet on 28 December, 2016. Around 17 proposals would be discussed, a finance ministry meeting notice stated. AMP Solar India, Grand Pvt Ltd. and Sanofi Synthelabo India proposals would also be considered.

    India allows FDI in some of the industry sectors via the automatic route, but, in certain segments that are considered sensitive for the economy and security, the proposals need to be cleared by FIPB first.

    FIPB had earlier met on 26 September to consider foreign investment proposals, including that of Idea Cellular Infrastructure Services.

    The Indian government has taken a series of measures in the recent past to give a fillip to foreign direct investment. In the first half of the current fiscal year, the inflows were USD 21.62 billion. FDI increased by 29 per cent to USD 40 billion in 2015-16 as compared to the previous fiscal.

  • Star Den, Flag Telecom, You & Idea FDI meet on 28 Dec

    Star Den, Flag Telecom, You & Idea FDI meet on 28 Dec

    MUMBAI: The foreign investment board will consider 17 foreign investment proposals on 28 December, including that of Star Den Media Services and others.

    Star Den Media Services Pvt. Ltd. develops and distributes television, cable, and the related network platforms. It offers a platform for distributing television channels in India through all fixed networks including cable, direct to home, and internet protocol television.

    Other investment proposals include that of Idea Cellular Infrastructure Services, Flag Telecom Singapore Pte Ltd and You Broadband India.

    FIPB had in June this year rejected a proposal of Flag Telecom Singapore, a wholly-owned unit of Reliance Communications (RCom), to set up a telecom subsidiary in India. Flag Telecom reportedly planned to acquire a company, payout for which would have been around US$120 million — in two parts.

    Now, the Foreign Investment Promotion Board, helmed by the economic affairs secretary Shaktikanta Das, is planning to meet on 28 December, 2016. Around 17 proposals would be discussed, a finance ministry meeting notice stated. AMP Solar India, Grand Pvt Ltd. and Sanofi Synthelabo India proposals would also be considered.

    India allows FDI in some of the industry sectors via the automatic route, but, in certain segments that are considered sensitive for the economy and security, the proposals need to be cleared by FIPB first.

    FIPB had earlier met on 26 September to consider foreign investment proposals, including that of Idea Cellular Infrastructure Services.

    The Indian government has taken a series of measures in the recent past to give a fillip to foreign direct investment. In the first half of the current fiscal year, the inflows were USD 21.62 billion. FDI increased by 29 per cent to USD 40 billion in 2015-16 as compared to the previous fiscal.

  • Consumers may get 60-day notice from unprofessional telcos

    Consumers may get 60-day notice from unprofessional telcos

    MUMBAI: The latest consultation paper of the Telecom Regulatory Authority of India (TRAI) is about issues related to closure of mobile phone services. TRAI seeks to extend the time mobile users get to change their service-provider if a particular company is shutting shop or selling its spectrum.

    The paper titled ‘Closure of Access Service” will seek feedback from telecom eco-system stakeholders to set up a framework to give an extended time and more options to users facing termination of services. A licence coming to fruition or failure of the service provider to bag spectrum or spectrum trading are normally the reasons behind an entity shutting shop.

    TRAI took note of three significant instances. Reliance Communications stopped CDMA services and migrated to LTE. Airtel acquired spectrum from Aircel and Videocon through trading deals. In some cases, operators do not renew the spectrum and stop offering services in a particular area. Tata Docomo has lost subscribers due to such non-renewal.

    The paper follows complaints from the subscribers who said they did not receive adequate notice or communication from their service-provider and their mobile number was disconnected. If TRAI has its way, cell-phone users will get more time to change their company in such a case.

    A mobile user currently gets 30 days to change its service-provider but this has been found to be far less than expected. The law requires the company to give the department of telecommunications (DoT) a 60-day notice in such a scenario.

    India’s low broadband penetration is a matter of concern and the government needs to do a lot more work in the field to go up in the global ladder, TRAI chairperson RS Sharma said.

    Addressing Assocham summit, Sharma said that, according to an ITU paper, the penetration in India was only 7%. He said the report stated that India was even behind countries such as Singapore, Thailand and Malaysia.

    TRAI has recommended to the government on using cable television network for broadband delivery. In developed US and in Europe, around 50-60 per cent broadband comes from Digital Cable TV, he added.

    Foreign direct investment (FDI) attracted by the telecom sector in India meanwhile has jumped to more than US$10 billion in the first eight months of 2016-17 registering a 6-7 fold increase as compared to 2014-15 and 2015-16, telecom secretary JS Deepak said at the summit.

    Considering about 97% of population was covered by the 2G telecom network provided mostly by private telecom operators, there was a need to both popularise and simplify USSD (unstructured supplementary service data), he added. There was a need to work on a push USSD rather than a pull USSD, merchants should be able to push in a message to feature phone users where-in one just has to okay it for a transaction, he said.

  • Consumers may get 60-day notice from unprofessional telcos

    Consumers may get 60-day notice from unprofessional telcos

    MUMBAI: The latest consultation paper of the Telecom Regulatory Authority of India (TRAI) is about issues related to closure of mobile phone services. TRAI seeks to extend the time mobile users get to change their service-provider if a particular company is shutting shop or selling its spectrum.

    The paper titled ‘Closure of Access Service” will seek feedback from telecom eco-system stakeholders to set up a framework to give an extended time and more options to users facing termination of services. A licence coming to fruition or failure of the service provider to bag spectrum or spectrum trading are normally the reasons behind an entity shutting shop.

    TRAI took note of three significant instances. Reliance Communications stopped CDMA services and migrated to LTE. Airtel acquired spectrum from Aircel and Videocon through trading deals. In some cases, operators do not renew the spectrum and stop offering services in a particular area. Tata Docomo has lost subscribers due to such non-renewal.

    The paper follows complaints from the subscribers who said they did not receive adequate notice or communication from their service-provider and their mobile number was disconnected. If TRAI has its way, cell-phone users will get more time to change their company in such a case.

    A mobile user currently gets 30 days to change its service-provider but this has been found to be far less than expected. The law requires the company to give the department of telecommunications (DoT) a 60-day notice in such a scenario.

    India’s low broadband penetration is a matter of concern and the government needs to do a lot more work in the field to go up in the global ladder, TRAI chairperson RS Sharma said.

    Addressing Assocham summit, Sharma said that, according to an ITU paper, the penetration in India was only 7%. He said the report stated that India was even behind countries such as Singapore, Thailand and Malaysia.

    TRAI has recommended to the government on using cable television network for broadband delivery. In developed US and in Europe, around 50-60 per cent broadband comes from Digital Cable TV, he added.

    Foreign direct investment (FDI) attracted by the telecom sector in India meanwhile has jumped to more than US$10 billion in the first eight months of 2016-17 registering a 6-7 fold increase as compared to 2014-15 and 2015-16, telecom secretary JS Deepak said at the summit.

    Considering about 97% of population was covered by the 2G telecom network provided mostly by private telecom operators, there was a need to both popularise and simplify USSD (unstructured supplementary service data), he added. There was a need to work on a push USSD rather than a pull USSD, merchants should be able to push in a message to feature phone users where-in one just has to okay it for a transaction, he said.