TeleGeography

GlobalComms Database

India
Summary Data
Total wireless subscribers (Dec 2014):
Population penetration:
Average penetration in region:
Average penetration in GDP per cap decile:

943,935,652
75.2%
92.1%
75.0%

Total broadband subscribers (Dec 2014):

Household penetration:
Average penetration in region:
Average penetration in GDP per cap decile:

15,750,000
6.0%
33.1%
4.6%

Total PSTN lines (2013):

Household penetration:
Average penetration in region:
Average penetration in GDP per cap decile:

28,890,000
11.3%
44.8%
10.5%

Country Overview
Key Data
Area (sq km):

3,287,590

Population 2013
(million):

1,239.3

Households 2013
(million):

255.2

Capital:

New Delhi

Language:

Hindi (official), Urdu, Tamil, Punjabi, Nepali, Kashmiri, Bengali,

Assamese, Gujarati, Sindhi, Marathi, Oriya, English, others

Exchange rate annual USD 1 = INR 60.96

average (2014):
GDP 2013 (USD
billion):

1,972.8

GDP per capita 2013

(USD thousand):

1.6

Sources: BBC, Central Statistical Organisation & Ministry of Finance - New Delhi, CIA
World Factbook, IMF, World Bank

Map

Political Profile
India is the world's largest federal republic, comprising 28 states, six union territories and
one national capital territory, headed by a president who serves a five-year term. The current
president, Shri Pranab Mukherjee took office in July 2012, replacing Pratibha Patil, who had
become India's first female president in July 2007. The national legislature is bicameral: the
Rajya Sabha (Council of States, upper house) has a maximum of 250 members, of whom 238
are elected by proportional votes of the elected members of parliament and the legislative
assemblies of the states and unions; the remaining twelve are appointed by the president.
The lower chamber, the Lok Sabha (Peoples Assembly), is composed of representatives of
the people chosen by direct election. It consists of 543 members elected by plurality vote in
single-member constituencies, with a further two members appointed by the president. The
executive is headed by the prime minister and a council of ministers chosen from members
of parliament.
According to the Indian constitution, elections for the Lok Sabha must be held at least every
five years under normal circumstances, and the countrys most recent general election took
place between April and May 2014. With around 814 million voters 100 million more than
in the previous poll in 2009 the election was the largest democratic exercise in history.
Six national parties contested the election namely the Indian National Congress (INC),
Bharatiya Janata Party (BJP), Communist Party of India (Marxist [CPIM]), Communist
Party of India (CPI), the National Congress Party (NCP), and the Bahujan Samaj Party
(BSP) although including local state parties that number rose to 370. Incumbents the
Indian National Congress (INC), led by Rahul Gandhi were expected to face a difficult
contest, bearing the brunt of voter unhappiness over a slowing economy and the countrys
serious corruption problems. The INCs main competition came from the BJP, led by the
controversial Narendra Modi. Chief minister of Gujarat, Modi has been praised for the states
strong economic growth, but has drawn flak for his inaction in the 2002 religious riots which
resulted in the deaths of more than 1,000 people, most of which were Muslims. In the event,
BJP won by a landslide, securing 282 seats, compared to the 44 garnered by the INC. Despite
the massive difference in seats, the share of votes was actually much closer, with INC and its
allies representing 23.4% of the poll compared to the 39% achieved by BJP and its associated
parties. Narendra Modi was sworn in as Prime Minister on 26 May with a mandate to rekindle
Indias economy and crackdown on corruption. At his inauguration, the new PM took steps to
improve relations with Indias chief strategic opponent Pakistan, inviting PM Nawaz Sharif
to the ceremony making Sharif the first Pakistani premier to be present at the inauguration
of an Indian prime minister.
Modis rise to power has raised concerns, however, that the election of such a controversial
hard-line Hindu nationalist may exacerbate sectarian tensions. India is prone to political
instability, with widespread violence within the hierarchical Hindu caste system, as well
as between the nations numerous religious communities including Sikhs, Christians and
Muslims. India is also host to several insurgencies, the most prominent of which are those
of the Kashmir separatists which favours the regions accession to Pakistan and the
Naxalite-Maoist rebels in the red corridor, a wide area in the east of the country afflicted
by the worst rates of poverty. The communist Naxalite uprising is made up of 7,000-10,000
rebels fighting for improved land rights and more jobs for neglected agricultural workers and
the poor. Recently, the implementation in 2009 of the Integrated Action Plan (IAP), a broad
coordinated operation including economic development projects alongside police and armed
forces actions, has limited the area in which the insurgents are active from 165 districts in
2007 to 120 in 2013, with the number severely affected by the uprising cut from 51 to 16.

Economic Development
India has the second largest area of arable land in the world, making it one of the largest
food producers on the planet; over 200 million tonnes of grain is produced annually. It is
the world's largest producer of milk (100 million tonnes per annum), sugarcane (315 million
tonnes) and tea (930 million kilograms each year) and the second largest producer of rice,
fruit and vegetables. Just over half of the country's labour force works in agriculture which,
including forestry and fishing, accounts for around a quarter of gross domestic product
(GDP), and previous governments have sought to articulate a rural economic development
programme that included creating basic infrastructure to improve the lives of the rural poor
and boost economic performance. The majority of landholdings are farmed at subsistence
level, and many farming families live below the poverty line. In other sectors, the country's
educated and skilled workforce makes it a popular choice for international companies seeking
to outsource, especially in the IT and communications fields.
Following the dramatic contractions of the 1990s, the Indian economy rebounded, and
followed a sustained growth trend, with five years of average growth of 8.75%. The economy
slowed, however, due in part to the global economic downturn, and in the year to March 2009
GDP growth fell back to 6.7%, from 7.3% in fiscal 2007/08. India quickly recovered from
the slowdown, recording GDP growth of 10.4% in 2010, exceeding its pre-downturn rate,
but such growth was short-lived, with the rate falling to 4.5% in the year ended 31 March
2013, while estimates suggest that 2013-2014 growth had edged up only marginally, to 4.9%.
Following a tough year in the agricultural sector, Indias Central Statistical Organisation
(CSO) has predicted the segment to expand by 4.6% in 2013-2014 compared to just 1.4% in
the previous year. Manufacturing, however, is estimated to have contracted by around 0.2%
on the back of a 1.1% expansion in the preceding twelve months.
Rising consumer prices remain a key problem for India and in May 2014, food prices rose
inflation stood at 9.5%, up from 8.6% the previous month; the situation is expected to worsen
with weak monsoon rains and the turmoil in Iraq expected to lead to further rises in food and
fuel costs. Newly elected PM Narendra Modi warned that the government would be forced
to administer bitter medicine to curb inflation, without specifying what action would be
taken although analysts have suggested that his announcement indicates a shift towards
minimising the nations deficit and avoiding popular, but inflationary, spending.
Meanwhile, unemployment is rife in India, particularly amongst the nations youth, with
the most recent official employment statistics showing that around 47 million Indians
equivalent to around 20% of the nations 15-24 year olds were out of work in 2011. Overall
unemployment was estimated to be 3.8% in 2012-2013, having increased from a recent low
of 3.5% two years previously. This figure fails to account for the fact that more than 90%
of the workforces is in informal employment, however. The recent lull in employment has
been blamed on the decline of the manufacturing industry, whilst the skill level of Indias
workforce has improved at a faster rate than job creation, leaving the nation with a sizeable
pool of skilled workers with few job opportunities.

Regulations
Regulatory Overview
Indias Ministry of Communications (MoC) has overall responsibility for the countrys
telecoms industry, and it operates via two main units: the Department of Telecommunications
(DoT), which regulates telephony services, and the Department of Electronics and
Information Technology (DeitY) rebranded from Department of Information Technology
(DIT) in April 2012 which is responsible for all policy related to IT and the internet. The
DoT was formed in 1985 when the government split the Department of Posts and Telegraphs.
It originally had both operational and regulatory functions and was responsible for the
provision of local fixed line telephony throughout India, with the exception of Mumbai and
Delhi, which were assigned to state-run telco Mahanagar Telephone Nigam Ltd (MTNL).
The DoT became a purely regulatory body in 1999 when its operational role was transferred
to the newly created Department of Telecoms Services (DTS), which merged with the
Department of Telecoms Operators (DTO) to become state-owned national operator Bharat
Sanchar Nigam Ltd (BSNL) the following year. To oversee the newly regulated market,
the Telecoms Regulatory Authority of India (TRAI) was created under the TRAI Act of
1997 (and subsequent 2000 amendment). It is an independent government body tasked with
ensuring technical compatibility and interconnectivity between service providers, resolving
disputes and overseeing compliance with licensing conditions. The 1997 act allows the TRAI
to set tariffs and fix terms and conditions under which operators can interconnect, while it
also requires the DoT to seek recommendations from the TRAI before issuing licences. The
Wireless Planning Commission (WPC), a unit within the MoC, allocates wireless spectrum.
The highest decision-making body of the MoC is known as the Telecom Commission.
For telecoms licensing purposes, India is divided into 22 operating zones, known as telecom
circles, roughly corresponding to its 28 states and three most populous cities (Mumbai,
Kolkata and Delhi known as Metro circles), but with several circles including more than
one state (Goa, for example is included in the Maharashtra circle). Chennai was originally
classified as a metro circle, meaning that there were in fact 23 circles, but in March 2008 it
was integrated into the Tamil Nadu licensing region; some operators, however, still report
separate subscriber numbers and financial data for the two regions. Previous legislation
prevented a company holding more than 10% either direct or indirect in another provider
offering services in the same circle, but in January 2014 the DoT released guidelines on
Unified Licences stating that no licensee or its promoter(s) directly or indirectly shall have
any beneficial interest in another licensee company in the same service area.
Meanwhile, in March 2009 the TRAI endorsed plans by the DoT for a three-year lock-in on
stake sales by new telcos; the move came after the DoT had suggested in 2008 that existing
telecom licensing norms be amended and a three- to five-year lock-in imposed on the sale
of promoters' equity in new entrants. Having referred the proposals to the TRAI, the latter
subsequently sought the view of the finance and law ministries, particularly with reference
to whether such a law could be imposed retroactively. The new legislation was officially
introduced in July 2009, with the lock-in period applying to any entity whose share capital
is/was 10% or more in the telecoms operator on the date that the licence was issued.
In October 2005 the state raised the cap on foreign direct investment (FDI) in telcos from
49% to 74%, subject to permission from the DoT and the Foreign Investment Promotion
Board (FIPB) on a case-by-case basis. Following the poor turnout for spectrum auctions
in November 2012 and March 2013, the high-level committee on financing infrastructure
(HLCFI) proposed the alterations to FDI, as a means to improve competition in spectrum
auctions. Whilst the current 74% cap allowed foreign companies to exercise complete control

over their Indian subsidiaries, the HLCFI noted that the requirement to find an Indian
investor for the remaining 26% presented an unnecessary constraint on potential investors.
Despite initial opposition from the DoT, the move was approved in July 2013, allowing
foreign companies to increase their holdings in Indian providers to 100%, although for a firm
to exceed the 74% cap it must gain the approval of the FIPB.
In May 2012 the government approved the National Telecoms Policy (NTP) 2012, which set
out its plans for the sector for the coming years. The NTP 2012 established eight missions:
1. To develop a robust and secure state-of-the-art telecommunication network providing
seamless coverage with special focus on rural and remote areas for bridging the digital divide
and thereby facilitate socio-economic development.
2. To create an inclusive knowledge society through the proliferation of affordable and highquality broadband services across the nation.
3. To reposition the mobile device as an instrument of socio-economic empowerment of
citizens.
4. To make India a global hub for telecom equipment manufacturing and a centre for
converged communication services.
5. To promote research and development (R&D), design in cutting edge ICT technologies,
products and services for meeting the infrastructure needs of domestic and global markets
with focus on security and green technologies.
6. To promote the development of new standards to meet national requirements, generation
of intellectual property rights (IPRs) and participation in international standardisation bodies
to contribute in formation of global standards, thereby making India a leading nation in the
area of telecom standardisation.
7. To attract investment, both domestic and foreign.
8. To promote creation of jobs through all of the above.
With these broad aims in mind, the policy sets out 31 specific goals including:
increasing rural teledensity from the current level of around 39% to 70% by 2017 and 100%
by 2020;
achieving 175 million broadband connections by 2017 and 600 million by 2020 at a
minimum download speed of 2Mbps, while also making available higher speeds of at least
100Mbps available on demand;
providing high speed broadband access to all village panchayats (small town-sized
settlements) through a combination of technologies by the year 2014 and progressively to all
villages and habitations by 2020.
Some of the most controversial changes outlined by the policy relate to establishing India
as a global hub for developing and manufacturing telecoms equipment. The government
aims to develop a complete chain of production, from research and development (R&D) to
testing and manufacturing that will be able to support 80% of Indias equipment demands
by 2020. The measures aim to limit the amount of revenue generated by servicing the
equipment needs of Indias booming telecoms sector that goes oversees, utilising the vast
size of the Indian market to improve the countrys standing and its influence in the telecom
sector internationally, and circumvent potential security risks. The NTP outlines plans to
financially support R&D, establish a national body to assist in the creation of national

and international norms and standards the Telecommunications Standard Development

Organisation (TDSO) aided by the construction of testing infrastructure, and provide
monetary incentives to domestic equipment providers that also encourage export of Indian
goods. Given the limitations of Indias existing domestic equipment manufacturing
ecosystem, the plans were derided as not only hopelessly ambitious but potentially harmful to
the nations economy and international standing. Indeed, India risks provoking intervention
from the World Trade Organisation (WTO) if it introduces such protectionist policies.
Nevertheless, in June 2014 it was reported that the government was preparing to launch
a slew of incentives for India telecom manufacturers to set the ball rolling. Amongst the
planned measures were ten-year tax holidays, a preferential market access (PMA) policy
which will require government-funded projects to procure security-sensitive equipment
locally and an INR10 billion (USD163.54 million) innovation fund (increasable to INR50
billion). The government had already implemented a PMA for state-owned telcos and
government entities by September 2013, although as at end-June 2014, a wider policy for
private sector procurement was still under consideration.
The appointment of a new telecom minister in early 2014 is expected to herald a turning
point in the regulation of Indias telecom sector as the new chief looks to restore order to
the sector in the wake of the 2G scandal. Amidst the fallout of the scandal, which ultimately
led to the February 2012 Supreme Court ruling that cancelled 122 illegally sold mobile
licences (see Wireless Key Legislation), government officials have consistently implemented
the maximum level of penalty for any infraction made by telcos, fearing that they might
be accused of corruption for showing any sign of leniency. The excessive severity of these
penalties such as fines of INR500 million for minor misdemeanours like incomplete
paperwork has only served to further damage the already tainted reputation of the sector.
Meanwhile, development in the space has stagnated as bureaucrats have increasingly delayed
making decisions by seeking legal counsel before taking a stance on an issue, lest they face
persecution in the future. Incoming minister Ravi Shankar Prasad called for ministry officials
to shun any fear in decision making and pledged to fully back honest decision making.
In August 2015, Prasad told parliament that the lions share of penalties levied by the DoT
had been delayed by legal challenges. INR11.33 billion worth of fines were dished out in the
2011-2012 year, but the amount collected was just INR2.06 billion, equating to around 18.2%
of the total. Subsequent years have yielded similarly poor results, with DoT realising 15.0%
of the INR7.19 billion levied in 2012-2013 and 1.6% of the INR79.23 billion charged in
2013-2014. In the current financial year, the DoT has issued fines totalling INR9.46 billion,
of which INR40 million (0.4%) had been paid. Justifying their recalcitrance, operators
have accused the DoT of being unnecessarily strict, in imposing maximum penalties for
procedural lapses and minor offences: the value of fines levelled by the DoT increased
tenfold between 2012-2013 and 2013-2014, from INR7.19 billion to INR79.23 billion.

Regulation Links
Wireless Key Legislation
Broadband Key Legislation
Wireline Key Legislation

Wireless Regulatory Overview

Regulatory Bodies
Department of Telecommunications (DoT)
20 Ashoka Road
Sanchar Bhawan
New Delhi 110001
India
Tel. +91 11 23716874
Fax +91 11 23353303
http://www.dotindia.com

Telecoms Regulatory Authority of India (TRAI)

A2/14, Safdarjung Enclave
New Delhi 110029
India
Tel. +91 11 26103294
Fax +91 11 26103294
http://www.trai.gov.in

Ministry of Communications (MoC)

6 CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +91 11 24363094
Fax +91 11 24362628
http://www.moc.gov.in

Wireless Planning Commission (WPC)

Sanchar Bhavan
20 Ashoka Road
New Delhi 110001
India
Tel. +91 11 4364757
Fax +91 11 4363134
http://www.wpc.gov.in

Wireless Key Legislation

The National Telecoms Policy (NTP) 1999 outlined the licensing for Cellular Mobile Service
Providers (CMSPs), including allowing them to share infrastructure with other providers,
with licensees permitted to offer all types of mobile voice and data services within their
licensed circle. In November 2003 the Telecom Regulatory Authority of India (TRAI)

replaced CMSPs with Unified Access Service Licences (UASLs), which cover technology
neutral communications in a specified circle, although wireless spectrum concessions must
be obtained separately.
For full details of providers operating areas see Wireless Market Commentary.
The mishandling of spectrum resources in the tainted 2008 sale has had a profoundly negative
impact on the sector, most notably the mass cancellation of 122 operating licences in
February 2012, the fallout from which is still affecting the market. On a more abstract note,
the resultant increase in scrutiny from Indias law enforcement agencies has coloured the
decision making of the Department of Telecommunications (DoT), exacerbating the growing
gulf between operators and regulatory authorities. Amidst the fallout from the 2G scandal
(see below), DoT officials have consistently implemented the maximum level of penalty for
any infraction made by telcos, fearing that they might be accused of corruption for showing
any sign of leniency.
In 2009 anti-corruption authority the Central Vigilance Commission (CVC) ordered the
Central Bureau of Investigation (CBI) to investigate the January 2008 allocation of 122
operating licences to Unitech Wireless (22, via eight subsidiaries), Loop Telecom (21),
Datacom Solutions (21), Shyam Telelink (21, including four allocated to Shyani Telelink),
Swan Telecom (13), Allianz Infratech (two), Idea Cellular (nine), Spice Communications
(four), STel (six) and Tata Teleservices (three) after concerns were raised regarding the
allocation process and the prices charged for the spectrum. The probe found substantial
evidence of corruption and mishandling of limited spectrum resources.
Leading up to the sale, the DoT received some 575 submissions from 46 companies interested
in acquiring the concessions, yet despite the massive interest, telecom minister Andimuthu
Raja altered the rules of the allocation process at the eleventh hour to restrict the number
of participating companies. On 10 January 2008, the minister retroactively moved the cutoff date for applications from 1 October to 25 September, insisting on a first-come, first
served (FCFS) basis. Letters of Intent (LoI) were also distributed on 10 January 2008 to
those companies that had submitted applications before the altered deadline, saying that those
which complied with the LoI between 3.30pm and 4.30pm on the same day would be issued
licences, with one caveat FCFS would be based from the issuance of LoI, contrary to
standard procedure. Normally, all those that completed the formality of the LoIs within 15
days would remain in the same order as on the application date this effectively removed the
time-frame aspect of the initial application process and reduced the amount of time players
had to arrange bank guarantees from the normal 15 days to just an hour. The alterations to
the allocation process meant that companies that had been forewarned of the change could
effectively be guaranteed concessions, regardless of the competition.
The suspicious alteration of the rules was far from being the only problem that authorities
later found with the allocation process, however. Indeed, a report from the Comptroller and
Auditor General of India (CAG) in November 2010 accused Mr Raja and the Ministry of
Communications (MoC) of causing the loss of up to INR1.77 trillion (USD34.65 billion) in
potential income for state coffers. According to the CAG report, the licences had been sold
at a much lower price than their actual value, with costs based on 2001 prices, when the
sector was in its infancy. Rubbing salt in the wound, Swan and Unitech later sold stakes
in their companies for amounts substantially higher than they paid for their concessions.
Swan paid INR15.37 billion for its authorisations and went on to sell a 45% stake in itself
to the UAEs Etisalat for INR420 billion. Unitech meanwhile spent INR16.61 billion on its
licences, while it received INR620 billion in return for selling a 60% stake to Norwegian
telecoms group Telenor. In addition to the low concession price, the CAG report also claimed
that, of the nine companies to have received licences at the start of 2008, five did not
fulfil the eligibility criteria for the sale process, namely Loop Telecom, Unitech, Datacom,
Swan and STel. Concluding its report the CAG noted: The minister (Raja) for no apparent
logical and valid reasons ignored the advice of the ministry of law, ministry of finance, and

avoided the deliberations of the Telecom Commission (the highest decision-making body of
the communications ministry) to allocate 2G airwaves, a scarce finite national asset, at less
than its true value on flexible criteria and procedures adopted to benefit a few operators.
In the wake of the CAG report, Raja was arrested in early 2011 on charges of forgery,
conspiracy, criminal misconduct and the abuse of an official position. The investigation
relating to the issuance of new UASLs and subsequent allocation of second-generation
spectrum during 2008-2009, has established commission of offences punishable, the federal
investigation body stated. The former minister is alleged to have received bribes totaling
INR30 billion for altering the allocation process, and was granted bail in May 2012. Trials
relating to the scam were, however, ongoing at the time of writing (June 2014), with
16 individuals also implicated in the affair sharing the dock with Raja as well as three
companies, namely; Swan Telecom, Unitech Wireless and Reliance Telecom.
Facing mounting criticism over the handling of the spectrum sale, in 2010 the DoT moved
to issue fines or cancel concessions of providers on the basis that the licensees had failed to
meet rollout obligations. The issue quickly got bogged down in arbitration, and infighting
between the TRAI and the DoT, however, with the latter blaming the TRAI for the fiasco,
criticising it for failing to take into consideration delays experienced by operators in
obtaining the frequencies and in acquiring permits to install infrastructure when assessing
whether the cellcos had met their rollout conditions.
Meanwhile, the matter of the 2008 2G licences came to a head on 2 February 2012, at
which date the Supreme Court ruled that all concessions issued in 2008 were invalid on the
grounds that their allocation had been totally arbitrary and unconstitutional. As directed
by the apex court, the DoT issued a statement later that month cancelling 122 licences,
including those belonging to Videocon (21), Uninor (22), Idea Cellular (13, four of which
were originally allocated to Spice Communications), Loop Telecom (21), STel (6), Sistema
Shyam TeleServices (21), Tata Teleservices (TTSL) (three), Etisalat DB (13, allocated to the
telco under its previous Swan brand) and Allianz (two).
Dual technology provider TTSL narrowly avoided having its 19 GSM licences, also allocated
on 10 January 2008, revoked. As the allocation of spectrum to dual technology players
followed a different and unrelated process it was omitted from the DoTs repeal of the tainted
concessions. Lobby group the Cellular Operators Association of India (COAI) sought to have
TTSLs GSM concessions included in the list of cancelled licences, however, appealing to
the TDSAT in July 2012. The TDSAT dismissed the appeal the following month though, and
in September 2012 supported the decision by arguing that the COAIs stance was based on a
misinterpretation of the Supreme Courts 2 February ruling.
In response to the licence cancellations, in late February 2012 Bahrain Telecommunications
Company (Batelco) sold off its stake in STel, which in turn announced plans to wind up
operations. Etisalat of the UAE followed suit and closed down its local unit that same
month, saying it had made the decision in order to protect the interests of all stakeholders
and to avoid incurring further costs at this time of rapid change and continued uncertainty
in the Indian telecommunications sector. Following up its announcement, Etisalat said it
would take legal action against its former partner, Dynamix Balwas Group (DB), blaming
it for the Supreme Courts action: Etisalat was induced into its investment in the company
that was then Swan Telecom, without any disclosure of the matters that are now alleged
by the CBI and Supreme Court. Etisalat is facing very significant financial losses on its
investment in EDB despite having no involvement in the 2G licence application or award
process and being entirely innocent of any allegations relating to it. In an effort to maintain
the markets stability, in April 2012 the TRAI instructed Etisalat DB and STel to continue
offering services until their licence cancellation came into effect, arguing that the duo
were still required to provide the watchdog and subscribers 60 days notice before halting
operations. The order proved ineffective however, with the watchdog shutting the door after
the horse had bolted, with Etisalat having already closed up shop in its 15 circles at end-

10

March, whilst STel had stopped offering services in its six circles earlier that month. The
watchdog instructed the two providers to restore their respective networks and continue
services until their licences were terminated, ordering them to comply with the terms of
their licence, to protect the interests of consumers, ensure technical compatibility and
effective interconnection between providers. Nonetheless, neither operator complied with
such instruction. Meanwhile, Loop Telecom, a sister company to Loop Mobile, announced
plans to close down in April, but toed the line on its licence obligations and put off a network
switch-off until early May 2012. At the time of the announcement of its plans to close, in
April 2012 Loop Telecom had launched in 13 circles but had only managed to sign up a total
of 6,172 subscribers, most of these (2,369) were in Kolkata, whilst Uttar Pradesh West had
seen the least success, with just eight subscribers in that region. The closure of Loop Telecom
ultimately dragged Loop Mobile down with it, and in February 2014 it was announced that
the remaining Mumbai-based business would be sold to Bharti Airtel, although the sale
process has encountered its share of difficulties (see Loop Mobile profile for details).
Telenor and Sistema also threatened to quit the sector, although as each was partly held by
the governments of Norway and Russia respectively, the duo first looked to leverage their
diplomatic connections to compel the Supreme Court to reverse its decision. Immediately
in the wake of the apex courts ruling, Norwegian IT minister Rigmor Aasrud met with
opposite number Kapi Sibal to discuss the cancellation. Aasrud described the meeting as
fruitful and constructive although the tete-a-tete yielded little tangible improvement for
Uninor/Telenor. Whilst Norways involvement in the matter was limited, Russian officials
went in guns blazing, with Moscows foreign ministry criticising the Indian authorities for
penalising SSTL for the fact that the licence-issuing procedures established by the Indian
telecom authorities were at variance with the countrys legislation, and threatening to seek
international arbitration over the matter. SSTL took a unique line amongst the cancelled
licensees, refusing to take part in the re-auction process until the Supreme Court had heard
its petition. With the issue showing little in the way of progress, in September 2012 SSTL
revealed that it was preparing to initiate legal proceedings against the Indian government
on the grounds it had violated the terms of the Bilateral Investment Protection Agreement
(BIPA). Despite issuing an ultimatum that it would seek billions of dollars in damages if
its licences were not returned, SSTL eventually backed down and repurchased a number of
concessions in a second auction (see below), in which it was the only participant. Meanwhile,
investor trust in the sector continued to spiral downwards, prompting Malaysias Axiata
a stakeholder in Idea Cellular to say that while it would not leave the market, it would
limit investment. Although not directly affected by the February 2012 licence cancellations,
Augere, which includes Orange Group (formerly France Telecom) amongst its investors,
decided to cut its losses and abandoned its launch plans, citing regulatory uncertainty.
Following on from its investigation into the January 2008 auction, in September 2012 the
CBI instructed the DoT to provide copies of licences, amendments and additional spectrum
issued by the telecoms ministry to Bharti Airtel and Vodafone India. The CBI was preparing
a case against the two cellcos, charging the duo as well as ten government officials for
allegedly entering into a conspiracy to acquire additional spectrum in the Mumbai and
Delhi circles in violation of regulations. Airtel and Vodafone have denied such allegations,
saying that they have maintained compliance with laws and regulations and cooperated with
agency officials. A chargesheet filed by the CBI in December 2012 alleged that the DoT had
increased base spectrum for telecom companies from 4.4 MHz to 6.2 MHz and also allocated
extra spectrum on subscriber-based criteria. Further, it accused former telecoms minister
Pramod Mahajan of allotting additional spectrum in a hurried manner and in contravention
with the then telecom policy. As at end-June 2014, there had been no further developments.
Having wiped out 122 concessions, the apex court set a four-month deadline for the regulator
to re-allocate the concessions. The DoT complained that the process would take closer to
13 months, including 95 days to analyse proposals from the TRAI, and some 245 days
to complete the auction itself. The schedule for the auction moved back and forth but
was eventually launched in November 2012. In the event, and after selling frequencies at

11

throwaway prices in 2008, the DoT and the TRAI set prohibitively high base prices for
spectrum for the 2012 tender. For 1800MHz spectrum, the duo set prices on a per MHz basis
depending on the circle, ranging from INR63.3 million (for Jammu and Kashmir) to INR6.93
billion (for Delhi); early drafts had, in fact, set the prices even higher, at between INR65.5
million and INR7.17 billion. With these prices representing a massive increase compared to
previous auctions, Telenor and SSTL, already pressuring the government to ease the terms of
the auction, threatened to quit the market in protest. Further, the revelation sparked a wave
of protests from industry players, which argued that tariffs would more than double as a
result of the measures as operators sought to recoup losses. In something of a conciliatory
gesture, in June 2012 the minimum amount of spectrum to be auctioned in each circle
was increased to 10MHz, up from the 5MHz initially suggested, with the regulator saying
it had altered the aim of the auction from revenue maximisation to maximising revenue
within the governments set parameters. Those factors included matters of affordability,
accessibility and the improvement of telecom density. Nevertheless, actual alterations to
the auction process were limited to a slight dip in reserve prices, and a relaxation of rules
regarding payment schedules.
Aside from the high base prices, the decision to refarm 900MHz spectrum already in use
by incumbent operators was poorly received. In addition to the 1800MHz and 800MHz
band spectrum freed up by the licence cancellation, the regulator also planned to auction
900MHz-band frequencies due to expire in 2014. Whilst the regulator failed to sell any such
spectrum in the subsequent auctions, the question of refarming has sparked a litigious battle
between the DoT and incumbents such as Vodafone, Bharti Airtel and RCOM. The main
point of contention revolves around the operators assertion that under the terms of their
concessions their authorisations can simply be renewed upon expiry, rather than them having
to repurchase the spectrum through auction. The latter method exposes the operators to far
greater risk and causes no small amount of disruption to the cellcos operational strategy,
as the providers must take into consideration the higher licensing fees and financing for
purchasing the spectrum when considering CAPEX and tariff structure. Regardless of the
operators protests, the DoT has maintained its stance, saying that a simple renewal of the
concessions is not possible as the market has changed too much since the original allocation.
The first batch of 900MHz spectrum was re-sold in February 2014 (see below), although
more are due to follow.
On 15 November 2012 the DoT published the preliminary results of its auction of 2G
frequencies, revealing that the sale had fallen far short of the governments expectations;
no bids were received for pan-India spectrum and spectrum in the four most expensive
circles Delhi, Mumbai, Karnataka and Rajasthan also went unsold. The governments
controversially high reserve prices were cited by operators and commentators as the reason
for the poor turnout. Whilst the government set a target income of INR400 billion from
the sale, it fell far short of the mark, bringing in only INR94.1 billion. Indeed, far from
being the highly competitive sale that the ministry had anticipated, spectrum in just one
circle Bihar exceeded its reserve price, selling for INR464.3 million, INR39.2 million
above the base cost. Five cellcos took part in the tender, three of which had seen their
previous concessions revoked by the government, along with two incumbents. Telewings
Communications Services the new local unit of Telenor which will ultimately replace
Uninor (see Uninor/Telewings profile for details) won spectrum in six circles, Idea in eight
and Videocon six, whilst Bharti gained additional spectrum in one area and Vodafone in
14. The results of the auction demonstrated a change of tack for the markets newcomers;
arguably deterred by regulatory uncertainty, Idea, Uninor and Videocon opted for low-risk
strategies, targeting circles where there was greater room for subscriber and revenue growth
and with comparatively low spectrum costs.
Understandably disappointed by the results of the auction, the state immediately set about
drawing up plans for a second spectrum sale. Noting the absence of any CDMA operators
from the initial auction, the DoT agreed in January 2013 to reduce the reserve prices of
800MHz spectrum. Meanwhile, the DoT pushed back the cut-off date for cancelled licensees

12

to shut down operations to 4 February 2013 to allow enough time for the Supreme Court
to hear SSTLs petition, and for the watchdog to stage a second tender. SSTL had refused
to participate in the November 2012 auction, confident that the Supreme Court would
agree to return its licences. Its plan backfired, however, and on 14 February the apex
court threw out the Russian companys plea. Narrowly avoiding forced closure, the cellco
was given permission to continue operating in the brief gap between the hearing and the
spectrum auction, which started was slated for 11 March. Despite its previous let-down, the
governments expectations for the second auction were still high, with it setting its sights
on raising INR400 billion from the spectrum sale. In the event the sale fizzled once more
though, with SSTL the only operator to bid. Moreover, as the sole participant the Russianbacked company hedged its bets and purchased frequencies in just eight circles, paying
INR36.39 billion for spectrum in Delhi, Gujarat, Karnataka, Kerala, Kolkata, Tamil Nadu,
Uttar Pradesh West and West Bengal.
As a conciliatory gesture, in the wake of the auctions, the DoT ruled that the operators (both
CDMA and GSM) could offset the price of their new concessions by the amount paid for
the cancelled licences in 2012. The announcement was a relief for the participating bidders,
although it was not until April 2014 that it was confirmed that Telewings/Uninor would be
included, as it had bought the new licences via a separate company established following its
split with former partners Unitech.
In February 2014, the DoT launched a fresh sale of 2G spectrum offering up the unsold
1800MHz frequencies, as well as the 900MHz concessions owned by Airtel and Vodafone
that were due to expire in November that year. Reliance Jio Infocomm Ltd (RJIL) bid
aggressively for spectrum in the 900MHz band and although it failed to acquire any airwaves
in that range, it succeeded in driving up the sale price for Vodafone and Bharti Airtel, which
were obliged to buy frequencies to ensure the continuation of services when their existing
concessions expire in November. Airtel spent INR185.3 billion on the auction, securing
900MHz frequencies in Delhi, Kolkata and Mumbai as well as 1800MHz in 15 circles, which
the cellco says it will use to expand its 4G network across India. Vodafone meanwhile spent
INR196 billion to win 900MHz frequencies in the three metro areas and 1800MHz spectrum
eleven circles. Idea Cellular was the only other operator to purchase 900MHz band spectrum,
winning frequencies in that band in the Delhi circle. The cellco also won 1800MHz band
frequencies in eleven other areas. Whilst Jio failed to acquire any spectrum in the 900MHz
band, the controversial new arrival, which already own rights to pan-India 4G frequencies,
walked away from the contest with 1800MHz concessions in 14 areas. Other successful
bidders included Uninor, which won airwaves in Andhra Pradesh, Assam and Bihar, whilst
Aircel was awarded 1800MHz spectrum in Jammu & Kashmir, North East, Rajasthan, Uttar
Pradesh East and West Bengal. Finally, RCOM bid successfully for 1800MHz frequencies in
the Mumbai area. The sale brought in a total of INR611.62 billion for state coffers after ten
days of bidding.
For its part SSTL has harshly criticised the regulators handling of the spectrum as being
unfairly tilted in favour of GSM providers, citing the omission of 800MHz frequencies from
the February auction and the watchdogs reluctance to lower the price of spectrum in that
band as it had done for the 1800MHz and 900MHz ranges used by GSM operators. The
TRAI has defended its stance, claiming that it has based its pricing scheme on the fact that
the 800MHz is potentially usable for 4G services, and is therefore more valuable. SSTL has
stated that it is interested in purchasing frequencies to expand nationwide if the airwaves are
priced appropriately.
In December 2013 the governments Empowered Group of Ministers (EGoM), which is
headed by the finance minister, agreed that one operator buying another telco should pay
market price for that telcos wireless spectrum holdings over 4.4MHz of GSM frequencies
and/or 2.5MHz of CDMA frequencies. Alternatively, the buyer can opt to hand back the
excess spectrum for re-auction by the government to avoid having to pay the fees. That

13

month, TTSL handed back its excess spectrum holdings in 15 circles, but opted to pay the
surcharge to keep the extra CDMA airwaves in the busier Mumbai and Delhi circles.
The introduction of third-generation services proved no less fraught than 2G licensing and
pricing matters. In October 2006 the TRAI identified the 450MHz, 1900MHz and 2100MHz
bands to be utilised for 3G cellular services, with frequencies in the 1900MHz band to be
made available exclusively for CDMA-based operators to pilot 3G services. GSM operators
objected to the use of the 1900MHz band on the supposition that it would create interference
with existing cellular services and 2100MHz UMTS services. Rejecting the plea by several
cellular operators that technology-neutral UASLs legally allowed them to undertake 3G
services, the DoT instead ruled that 'allotment of 3G spectrum in the 2100MHz band will be
treated as a standalone allotment, separate from the present 2G services.' The DoT allowed
seven operators to use portions of 2100MHz spectrum to carry out trials of W-CDMAbased services during the first half of 2007, with Bharti Airtel, Aircel, Idea Cellular, BSNL,
MTNL, RCOM and Vodafone India (then Hutchison Essar) permitted to test systems in cities
including Mumbai, Bangalore, Gurgaon, Chennai, Coimbatore and Kolkata; successful trials
helped to counter interference claims. Meanwhile, the two state-owned operators BSNL
and MTNL were assured in April 2007 that they would be guaranteed 3G licences, and
in November that year the DoT confirmed it would make additional 2100MHz spectrum
available through an auction process. A total of 30MHz of UMTS spectrum would be sold
in each circle, it said, with the aim of licensing at least three operators in each. Despite the
auction details appearing to have been thoroughly thought through, no concrete date was set
for the sale and the timeframe soon slipped to early 2009, while disagreements between the
Ministry of Finance, DoT, TRAI and Cabinet Committee on Economic Affairs (CCEA) only
served to postpone the sale further.
Finally, in August 2009 it appeared that the saga had reached a conclusion, with the
Empowered Group of Ministers (EGoM) announcing its final recommendations. In addition
to finalising the pricing structure for the auction process, the EGoM also confirmed that a
total of five operators would be licensed to offer 3G services in each circle, including the slot
already reserved for BSNL and MTNL in their respective regions of operation. Alongside
pricing, the number of licences up for grabs had also proved a difficult issue to resolve.
The DoT initially expected to offer up to five 3G licences per circle, with up to ten licences
made available in a second auction phase; the latter step however required the military to
decommission frequencies for commercial use, a process which was initially predicted could
be virtually complete by mid-2009. Holding up proceedings though, the armed forces called
for a delay in the release of frequencies until BSNL had completed the rollout of a fixed
network to replace the existing wireless systems used by the military, a process not scheduled
to be completed until 2011. The Ministry of Defence (MoD) and the DoT soon reached a deal,
inking a memorandum of understanding (MoU) in June 2009 under which the former agreed
to vacate spectrum needed for 2G and 3G licensees over a three-year period; the armed forces
agreed to initially release 10MHz of spectrum suitable for 3G services, and a further 5MHz
for 2G service with immediate effect, with the remainder of its held spectrum released in
a phased manner upon BSNLs completion of the aforementioned fibre-optic network. The
sale of 3G frequencies proceeded, although further problems prevented the military spectrum
from being put to use by private operators. BSNL, tasked with managing the deployment of
the MoDs replacement cable network, repeatedly failed to select a company to supply and
install the new platform. A tender for was initiated in November 2012 only to be cancelled
in February 2013, and while in November that year the DoT and BSNL renewed promises to
complete the network the deadline was pushed back to July 2015.
Irrespective of the military-held airwaves, the 3G spectrum sale continued to face delays,
and in early January 2010 the DoT confirmed it had opted to restrict the auction to offering
just three 3G licences to GSM operators per circle. With the sale finally underway in March
2010, at that date the regulator confirmed that nine operators had submitted applications to
bid, those being: Airtel, Vodafone, TTSL, Etisalat, STel, Videocon, RCOM, Idea and Aircel.
After 34 days of bidding, in late May 2010 seven of the nine walked away with 3G licences,

14

although no single operator was able to lay claim to a pan-India concession; the most that any
cellco managed to win being frequencies in 13 of the countrys 22 telecoms circles. Three
of the participants Bharti Airtel, RCOM and Aircel acquired 2x5MHz paired spectrum
in 13 circles, although due to the manner of the bidding the trio paid significantly different
amounts for their respective concessions, as licence prices were decided on a circle-by-circle
basis. Bhartis 13 licence areas cost it INR122.95 billion, the highest paid by any of the seven
3G auction winners, while Aircel paid just over half of that, INR64.99 billion, for its 13
licences, and RCOM was charged INR85.85 billion for its concessions. Idea Cellular bagged
the next highest number of circles eleven paying INR57.69 billion, while both TTSL
and Vodafone gained permission to offer third-generation services in nine circles, paying
INR58.64 billion and INR116.18 billion respectively for their concessions. STel rounded out
the successful bidders, claiming three circles for a total of INR731 million, leaving Etisalat
and Videocon empty-handed. (For full details of licensed circles see table below.)
With no operator able to secure a pan-India concession, Bharti, Vodafone, Idea and RCOM
signed 3G roaming agreements to offer services to their customers outside of their licence
areas. In another blow to the credibility of the sectors regulators, in December 2011 the
government performed an embarrassing volte-face on 3G roaming and declared the practice
illegal, despite having ostensibly green-lit such measures prior to the sale. Aware that
pursuing pan-India 3G spectrum would be both risky and costly due to the high volume of
bidders and limited frequencies available, prior to the auction prospective bidding operators
had sought clarification from the regulator on whether or not roaming agreements would
be allowed. In response the watchdog had confirmed that cellcos would indeed be able to
offer services outside of their licensed areas through deals with licensed players. Telecoms
minister Kapil Sibal sought to explain away the U-turn by declaring that whilst intracircle roaming was permissible i.e. it could potentially be authorised without infringing
other regulations it was nevertheless not permitted. Outraged by the arbitrary and
irrational decision by the regulators, the providers affected appealed to the PM to intervene
or refund the licences, writing: In the event that 3G ICR [intra-circle roaming] is now
deemed impermissible, then it would be a clear breach of our contract and the pre-auction
confirmation given by the government. In that eventuality, we request that our spectrum
auction payments be refunded to us with interest along with compensation for all the capital
investments made by us. At the same time, the quartet sought a ruling from the TDSAT,
although the tribunals final stance on the matter was inconclusive, with it delivering a split
decision verdict in July 2012. With the TDSAT case failing to clarify the matter, the DoT
issued fresh show-cause notices the following month and placed increasing pressure on the
cellcos in the latter half of that year, threatening to levy hefty fines against them. After more
than a year of bouncing through various courts, the Supreme Court delivered something of
a compromise on the matter in April 2013 by allowing operators to continue providing 3G
services via inter circle roaming, though only to existing customers: cellcos were banned
from signing up any new 3G subscribers outside of their licensed circles but would not
be required to disconnect customers already taking the service. A year later, however, in
April 2014, the TDSAT overturned the apex courts decision and more than INR12 billion
in penalties issued by the DoT, paving the way for operators to resume offering 3G services
outside of their licensed areas through roaming pacts.
Whilst the process of selling 3G licences was bogged down in delays, in August 2009 it was
rumoured that the watchdog had prepared a concept paper relating to the provision of 4G
services. However, in April the following year the then-communications minister Raja denied
the speculation, saying that there were no plans to auction 4G spectrum: The question of
the need of 700MHz (4G) spectrum (for the public) is being studied. It is not necessary as
of now. The TRAI did, however, issue a pre-consultation paper in February 2010 aimed at
identifying the issues involved in the introduction of 4G such as allocation and pricing of
spectrum, calling for submissions by 15 March 2010. Trials of the technology followed, with
Swedish vendor Ericsson in July 2010 claiming to have become the first in India to trial the
Time Division Duplex version of Long Term Evolution (TDD-LTE). Then, in October 2010

15

NSN said that it too had made a test call using TDD-LTE at its Bengaluru Research and
Development (R&D) facility, and during the test call the vendor demonstrated high definition
(HD) video streaming and three-way videoconferencing.
Whilst LTE licensing has been a low priority since the 2G licences were revoked, Bharti
actually launched the countrys first LTE network in April 2012, using 2300MHz Broadband
Wireless Access (BWA) spectrum it had purchased in 2010, later supplemented by the telcos
acquisition of a 49% stake in Qualcomms Indian entities that also held BWA frequencies. At
the time of writing (June 2014), Airtel held a monopoly on LTE services, although two rivals
have stated their intention to launch competing products. To that end, Videocon revealed in
March 2013 that it would use its newly purchased 1800MHz concessions to roll out LTE
services in six circles; as the UASLs are technology neutral, the cellco does not need to
acquire any additional licences to provide the wireless broadband service. In contrast to
Bharti, Videocon noted that it would use the Frequency Division Duplex (FDD) standard for
its LTE platform. Meanwhile RJIL, the telecoms arm of Reliance Industries Ltd (RIL), has
is planning to use the pan-India BWA spectrum it won in 2010 under the Infotel Broadband
name to launch LTE services. RJIL is looking to launch 4G services in the second half
of 2014 and has begun rolling out its network, augmented with a number of infrastructure
sharing deals.
Looking ahead, in its April 2012 spectrum auction recommendations and subsequent
amendments, the TRAI suggested that further 2100MHz frequencies be auctioned in the
second half of 2013-2014 (i.e. September 2013 to March 2014), whilst 700MHz frequencies
should be made available in the first half of 2014-2015, followed by 2300MHz spectrum six
months later. However, at the time of writing (June 2014), the TRAI and the DoT had made
no further announcements regarding the sale of spectrum in these bands, except to say that
an auction is now unlikely to take place before 2015-2016.
The implementation of mobile number portability (MNP) was first proposed in the defunct
draft for the National Telecom Policy (NTP) 2005, with the planning process launched
in March 2006 when the TRAI issued recommendations on the service to the DoT. Early
plans suggested dividing the country into two zones, one covering the northern and western
states, the other covering the southern and eastern regions. Little progress was made until
March 2009, when it was announced that US firms Syniverse Technologies and Telcordia
Technologies had been selected to manage MNP; the former in the northern zone, the
latter, as part of joint venture MNP Interconnection Telecom Solutions India (MITSI) in the
southern. Having already passed earlier deadlines, the DoT ordered rollout of the service
to begin in certain circles (Delhi, Mumbai, Maharashtra and Gujarat in the North, Calcutta,
Tamil Nadu, Andhra Pradesh and Karnataka in the South) on 20 September 2009. A second
phase would see the implementation of MNP in the remaining circles by 20 March 2010.
However, in August 2009 the regulators were forced to postpone the deadlines once more,
this time saying that the service would be made available by the end of December that year at
the earliest; the delay was attributed to network operators not making the necessary changes
to their systems and the TRAIs failure to set tariffs for the service. The DoT remained
optimistic, however, targeting a nationwide launch by the end of March 2010, though this too
was missed and the deadline pushed back further. Frustrated with the delays, in July 2010
the TRAI argued that the DoT should allow no more changes to the timetable, and consider
penalising operators not prepared to introduce the service.
The issue was complicated in early 2010 when the Foreign Investment Promotion Board
(FIPB) raised concerns over the shareholding structure of MITSI. The Ministry of Home
Affairs (MHA) shared the FIPBs misgivings, troubled by reports that Telcordia had signed
a contract in neighbouring Pakistan to provide similar MNP services. MITSIs licence was
subsequently revoked, citing security concerns, following prompts from the MHA. As a
result, in August 2010 the DoT requested that Syniverse implement MNP nationwide. Partly
as a result of Telcordias exit, and partly due to further delays from operators in spite of an
announcement from the DoT that no operator would be allowed to launch new commercial

16

services after 1 September 2010 unless their network was MNP-ready an October deadline
for launch was missed. Subsequently, it was announced that applications from mobile voice
subscribers for the long-delayed service would begin from 25 November 2010. Finally
meeting a deadline, MNP was launched as planned in Haryana, with the charge for switching
set at a maximum of INR19 and the maximum time for the switchover set as seven days. The
service was rolled out nationwide from 20 January 2011, though it was noted that porting in
Jammu & Kashmir, Assam and North East circles could take up to 15 days. Under the current
MNP scheme, customers are required to stay with their new provider for a minimum of three
months and porting is restricted to within each circle; subscribers may not port between
operating areas. More recently, the government took a step closer to implementing full
national MNP in June 2014, when the Telecom Commission granted in-principle approval to
the plan. However, with the nuts and bolts of the one nation, one number plan still to be
hammered out amongst Indias regulators, the service expansion remains some way off.
Mobile Virtual Network Operators (MVNOs) are currently not permitted in India, although
proposals were drawn up in 2008 only to fall by the wayside the following year.
The TRAI set a cost-based SMS termination charge of INR0.02 per message in late May
2013, which came into force from 1 June 2013. The TRAI noted that the determination of
interconnection charges for SMS has been an option available to the regulator since the 2003,
although it has until now maintained a policy of forbearance. In response to concerns that
leniency over interconnection fees was allowing dominant players to exploit their position,
in March 2009 the TRAI ordered that termination charges should be transparent, reciprocal
and non-discriminatory. In 2011 the TRAI officially began the consultation process for the
introduction of SMS interconnection fees, through which a number of providers questioned
the need for such measures, except for where unsolicited spam messages and commercial
SMS are concerned. The question of discriminatory interconnection charges resurfaced in
subsequent years, with certain cellcos accused of abusing dominant market positions to
coerce rivals into paying higher fees. The TRAIs study showed that cost per SMS for six
operators varied from INR0.0077 to INR0.0253, with an average cost of INR0.0185, although
the elevated cost of the highest price was due to much higher than average costs other than
network elements. When this was brought in line with the typical value for the market, the
cost per SMS was lowered to INR0.018. At INR0.02 per SMS, the termination fee set by
the TRAI is a little over the typical cost per SMS. Responding to complaints over smaller
operators selling cheap bulk SMS for telemarketing, the TRAI has set a charge of INR0.05
per SMS for transactional SMS.

17

3G Licences by Circle
Circle

Bharti Airtel

Reliance Communications

Aircel

Idea Cellular

Vodafone Essar

Tata Teleservices

STel

Andhra Pradesh

Assam

Bihar

Delhi

Gujarat

Haryana

Himachal Pradesh

Jammu & Kashmir

Karnataka

Kerala

Madhya Pradesh

Maharashtra

Mumbai

North East

Orissa

Punjab

Rajasthan

Tamil Nadu

Uttar Pradesh (East)

Uttar Pradesh (West)

18

Circle

Bharti Airtel

Reliance Communications

Aircel

Idea Cellular

Vodafone Essar

Tata Teleservices

STel

Kolkata

West Bengal

Sources: TRAI

Results of Spectrum Auctions from November 2012

Operator Circle
Aircel

Bharti
Airtel

Block
(MHz)

Uplink (MHz)

Downlink (MHz)

Price
(INR m)

Auction

Jammu &
Kashmir

2x1.8

(1724.7-1725.5), (1730.1-1731.1)

(1819.7-1820.5), (1825.1-1826.1)

10.98

Feb-14

North East

2x1.8

1749.3-1751.1

1844.3-1846.1

12.60

Feb-14

Rajasthan

2x1.6

(1736.9-1737.1), (1749.1-1750.5)

(1831.9-1832.1), (1844.1-1845.5)

41.60

Feb-14

Uttar
Pradesh
East

2x1.8

1718.7-1720.5

1813.7-1815.5

115.20

Feb-14

West
Bengal

2x1.2

1759.3-1760.5

1854.3-1855.5

29.52

Feb-14

Assam

2x1.25

1725.1-1726.35

1820.1-1821.35

86.70

Nov-12

Andhra
Pradesh

2x8.8

(1724.3-1729.3), (1744.7-1745.3),
(1734.5-1736.5)(1756.9-1758.1)

(1819.3-1824.3), (1839.7-1840.3), (1829.5-1831.5), 1,434.40

(1851.9-1853.1)

Feb-14

Delhi

2x7

(1753.3-1758.3), (1719.7-1720.1), (1730.5-1731.5), (1848.3-1853.3), (1814.7-1815.1), (1825.5-1826.5), 2,548.00

(1745.7-1746.3)
(1840.7-1841.3)

Feb-14

Delhi

2x6

900.1-906.1

Feb-14

Himachal
Pradesh

2x10.2

(1721.1-1726.1),(1726.3-1726.9), (1731.3-1731-7), (1816.1-1821.1), (1821.3-1821.9), (1826.3-1826.7), 61.20

(1738.3-1739.9) (1761.1-1763.7)
(1833.3-1834.9), (1856.1-1858.7)

Feb-14

Jammu &
Kashmir

2x2.6

1722.1-1724.7

Feb-14

945.1-951.1

1817.1-1819.7

4,445.76

15.86

19

Operator Circle

Idea
Cellular

Block
(MHz)

Uplink (MHz)

Downlink (MHz)

Price
(INR m)

Auction

Karnataka

2x8.8

(1723.5-1729.9), (1714.7-1715.1), (1744.3-1746.5) (1818.5-1824.9), (1809.7-1810.1), (1839.3-1841.5) 1,364.00

Feb-14

Kerala

2x5

1730.9-1735.9

1825.9-1830.9

260.00

Feb-14

Kolkata

2x5

1721.9-1726.9

1816.9-1821.9

365.00

Feb-14

Kolkata

2x7

(895.1-900.1), (909.5-911.5)

(940.1-945.1), (954.5-956.5)

1,362.41

Feb-14

Madhya
Pradesh

2x5.8

(1756.3-1759.9), (1726.3-1728.5)

(1851.3-1854.9), (1821.3-1823.5)

292.32

Feb-14

Mumbai

2x6

(1710.1-1715.1), (1760.9-1761.1), (1737.3-1738.1) (1805.1-1810.1), (1855.9-1856.1), (1832.3-1833.1) 1,632.00

Feb-14

Mumbai

2x5

909.9-914.9

954.9-959.9

2,815.45

Feb-14

North East

2x7

(1719.5-1724.5), (1726.1-1728.1)

(1814.5-1819.5), (1821.1-1823.1)

49.00

Feb-14

Orissa

2x5

1715.3-1720.3

1810.3-1815.3

80.00

Feb-14

Punjab

2x8.2

(1754.1-1759.1), (1761.1-1761.7), (1743.3-1745.1), (1849.1-1854.1), (1856.1-1856.7), (1838.3-1840.1), 442.80

(1721.1-1721.9)
(1816.1-1816.9)

Feb-14

Rajasthan

2x8.2

(1738.9-1743.9), (1750.5-1752.1), (1720.9-1722.5) (1833.9-1838.9), (1845.5-1847.1), (1815.9-1817.9) 213.20

Feb-14

Tamil Nadu

2x5

1738.5-1743.5

1833.5-1838.5

1,040.00

Feb-14

West
Bengal

2x4.4

1735.5-1739.9

1830.5-1834.9

108.24

Feb-14

Andhra
Pradesh

2x6

(1729.3-1734.3), (1743.7-1744.7)

(1824.3-1829.3), (1838.7-1839.7)

978.00

Feb-14

Assam

2x5

1735.2-1740.2

1830.2-1835.2

346.80

Nov-12

Bihar

2x1.25

1740.4-17165

1835.4-1836.65

464.30

Nov-12

Delhi

2x0.6

1710.1-1710.7

1805.1-1805.7

218.40

Feb-14

Delhi

2x5

890.1-895.1

935.1-940.1

3,704.80

Feb-14

Jammu &
Kashmir

2x5

1720.4-1725.4

1815.4-1820.4

253.20

Nov-12

20

Operator Circle

Block
(MHz)

Uplink (MHz)

Downlink (MHz)
1816.1-1817.7

Price
(INR m)

Auction

Gujarat

2x1.6

1721-1-1722.7

380.48

Feb-14

Haryana

2x6

(1710.1-1715.1), (1719.1-1719.5), (1729.3-1729.9) (1805.1-1810.1), (1814.1-1814.5), (1824.3-1824.9) 162.00

Feb-14

Karnataka

2x5

1738.3-1743.3

1833.3-1838.3

775.00

Feb-14

Kerala

2x10

(1719.1-1724.1), (1751.7-1756.7)

(1814.1-1819.1), (1846.7-1851.7)

520.00

Feb-14

Kolkata

2x5

1735.8-1740.8

1830.8-1835.8

4,548.80

Nov-12

Madhya
Pradesh

2x7

(1737.9-1742.9), (1764.7-1764.9), (1745.7-1746.5), (1832.9-1837.9), (1859.7-1859.9), (1840.7-1841.5), 352.80

(1714.5-1715.1), (1723.7-1724.1)
(1809.5-1810.1), (1818.7-1819.1)

Feb-14

Maharashtra 2x9

(1710.1-1715.1), (1761.9-1764.9), (1758.9-1759.9) (1805.1-1810.1), (1856.9-1859.9), (1853.9-1854.9) 2,613.15

Feb-14

Mumbai

2x2

1715.9-1717.9

1810.9-1812.9

544.00

Feb-14

North East

2x5

1734-1739

1829-1834

353.60

Nov-12

North East

2x5

1757.1-1762.1

1852.1-1857.1

35.00

Feb-14

Orissa

2x5

1710.2-1715.2

1805.2-1810.2

810.80

Nov-12

Punjab

2x8

(1710.1-1715.1), (1750.7-1751.9), (1759.3-1761.1) (1805.1-1810.1), (1845.7-1846.9), (1854.3-1855.9) 432.00

Feb-14

Tamil Nadu

2x3.75

1733.4-1737.15

1828.4-1832.15

2,285.10

Nov-12

West
Bengal

2x6.25

(1721.2-1726.2), (1759.6-1760.85)

(1816.2-1821.2), (1854.6-1855.85)

1,292.00

Nov-12

RCOM

Mumbai

2x0.6

1715.3-1715.9

1810.3-1810.9

163.20

Feb-14

RJIL

Andhra
Pradesh

2x5.8

(1751.7-1756.7), (1742.9-1743.7)

(1846.7-1851.7), (1837.9-1838.7)

945.40

Feb-14

Assam

2x5.4

(1722.5-1727.5), (1749.5-1749.9)

(1817.5-1822.5), (1844.5-1844.9)

194.94

Feb-14

Delhi

2x5.4

(1723.1-1728.1), (1746.3-1746.7)

(1818.1-1823.1)(1841.3-1841.7)

1,965.60

Feb-14

Gujarat

2x6

1743.7-1749.9

1838.7-1844.9

1,426.80

Feb-14

Karnataka

2x5

1759.9-1764.9

1854.9-1859.9

775.00

Feb-14

21

Operator Circle

SSTL/
MTS

Uninor

Block
(MHz)

Uplink (MHz)

Downlink (MHz)

Price
(INR m)

Auction

Kerala

2x5

1741.1-1746.1

1836.1-1841.1

260.00

Feb-14

Kolkata

2x5

1726.9-1731.9

1821.9-1826.9

365.00

Feb-14

Madhya
Pradesh

2x6.4

(1751.1-1756.1), (1728.5-1728.9), (1763.7-1764.7) (1846.1-1851.1), (1823.5-1823.9), (1858.7-1859.7) 322.56

Feb-14

Maharashtra 2x5

1724.5-1729.5

1819.5-1824.5

1,451.75

Feb-14

Mumbai

2x6.6

(1749.1-1754.1), (1759.3-1760.9)

(1844.1-1849.1), (1854.3-1855.9)

1,795.20

Feb-14

North East

2x6.4

(1739.1-1744.1), (1751.1-1751.9), (1725.5-1726.1) (1834.1-1839.1), (1846.1-1846.9), (1820.5-1821.1) 44.80

Feb-14

Orissa

2x5

1723.1-1728.1

1818.1-1823.1

80.00

Feb-14

Tamil Nadu

2x6.2

(1720.3-1725.3), (1749.1-1750.3)

(1815.3-1820.3), (1844.1-1845.3)

1,289.60

Feb-14

West
Bengal

2x5.6

(1716.1-1721.1), (1760.5-1761.1)

(1811.1-1816.1), (1855.5-1856.1)

137.76

Feb-14

Delhi

2x3.75

(840.975-843.435), (828.405-829.635)

(885.975-888.435), (873.405-874.635)

13,514.70 Mar-13

Gujurat

2x3.75

(827.175-829.635), (835.455-836.685)

(872.175-814.635), (880.455-881.685)

4,384.50

Mar-13

Karnataka

2x3.75

(840.975-843.435), (828.405-829.635)

(885.975-888.435), (873.405-874.635)

6,437.40

Mar-13

Kerala

2x3.75

(840.975-843.435), (828.405-829.635)

(885.975-888.435), (873.405-874.635)

1,273.50

Mar-13

Kolkata

2x3.75

(834.555-837.015), (831.465-832.695)

(879.555-882.015), (876.465-877.695)

2,217.60

Mar-13

Tamil Nadu

2x3.75

(840.975-843.435), (828.405-829.635)

(885.975-888.435), (873.405-874.635)

5,968.80

Mar-13

Uttar
Pradesh
West

2x3.75

(840.975-843.435), (828.405-829.635)

(885.975-888.435), (873.405-874.635)

2,094.60

Mar-13

West
Bengal

2x2.5

(835.155-837.615), (831.165-832.395)

(880.155-882.615), (876.165-877.395)

503.70

Mar-13

Andhra
Pradesh

2x5

1719.2-1724.2

1814.2-1819.2

11,476.40 Nov-12

22

Operator Circle

Block
(MHz)

Uplink (MHz)

Downlink (MHz)

Auction

Andhra
Pradesh

2x1.4

1741.5-1742.9

228.20

Feb-14

Assam

2x6

(1762.7-1764.9), (1758.7-1760.9), (1741.7-1742.9), (1857.7-1859.9), (1853.7-1855.9), (1836.7-1837.9), 216.60

(1749.1-1749.5)
(1844.1-1844.5)

Feb-14

Bihar

2x5

1724.6-1729.6

1819.6-1824.6

1,857.20

Nov-12

(1760.7-1761.5), (1747.5-1748.9)

(1855.7-1856.5), (1842.5-1843.9)

94.82

Feb-14

2x5

1738.6-1743.6

1833.6-1838.6

8,993.60

Nov-12

Maharashtra 2x5

1753.8-1758.8

1848.8-1853.8

10,512.00 Nov-12

Uttar
Pradesh
East

2x5

1723.0-1728.0

1818.0-1823.0

3,046.80

Nov-12

Uttar
Pradesh
East

2x1.8

1720.5-1722.3

1815.5-1817.3

115.20

Feb-14

Uttar
Pradesh
West

2x5

1738.6-1743.6

1833.6-1838.6

4,296.40

Nov-12

Uttar
Pradesh
West

2x2

(1744.1-1744.9), (1762.5-1763.7)

(1839.1-1839.9), (1857.5-1858.7)

189.90

Feb-14

2x5

1735.2-1740.2

1830.2-1835.2

2,321.50

Nov-12

Gujarat

2x5

1710.2-1715.2

1805.2-1810.2

8,993.60

Nov-12

Haryana

2x5

1719-6-1724.6

1814.6-1819.6

1,860.80

Nov-12

Madhya
Pradesh

2x5

1718.4-1723.4

1813.4-1818.4

2,157.60

Nov-12

Uttar
Pradesh
East

2x5

1728-1735

1823-1828

3,046.80

Nov-12

Bihar
Gujarat

Videocon Bihar

1836.5-1837.9

Price
(INR m)

23

Operator Circle
Uttar
Pradesh
West

Block
(MHz)

Uplink (MHz)

Downlink (MHz)

Price
(INR m)

Auction

2x5

1714-1719

1809-1814

6,816.40

Nov-12

2x0.6

1740.9-1741.5

1835.9-1836.5

97.80

Feb-14

Assam

2x1.25

(1722.6-1723.85), (1726.35-1727.6)

(1817.6-1818.85), (1821.35-1822.6)

173.40

Nov-12

Bihar

2x2.5

1751.8-1754.3

1846.8-1849.3

928.60

Nov-12

Delhi

2x8

(1758.3-1763.3), (1710.7-1712.1), (1718.1-1719.7) (1853.3-1858.3) ,(1805.7-1807.1), (1813.1-1814.7) 2,912.00

Feb-14

Delhi

2x5

895.1-900.1

940.1-945.1

3,704.80

Feb-14

Gujurat

2x4.4

(1722.7-1725.5), (1715.3-1716.9)

(1817.7-1820.5), (1810.3-1811.9)

1,046.32

Feb-14

Haryana

2x2.5

1760.5-1763

1855.5-1858

930.40

Nov-12

Haryana

2x2.4

(1743.5-1745.1), (1718.3-1719.1)

(1838.5-1840.1), (1813.3-1814.1)

64.80

Feb-14

Himachal
Pradesh

2x1.25

1728.9-1730.15

1823.9-1825.15

77.80

Nov-12

Jammu &
Kashmir

2x2.5

1761.4-1763.9

1856.4-1858.9

126.60

Nov-12

Karnataka

2x5

1733.3-1738.3

1828.3-1833.3

775.00

Feb-14

Kerala

2x1.25

1722.95-1724.2

1817.95-1819.2

653.00

Nov-12

Kerala

2x7.2

(1724.1-1729.1), (1747.3-1749.3)

(1819.1-1824.1), (1842.3-1844.3)

374.40

Feb-14

Kolkata

2x8

(1716.9-1721.9), (1762.5-1764.3), (1747.9-1749.1) (1811.9-1816.9), (1857.5-1859.3), (1842.9-1844.1) 584.00

Feb-14

Kolkata

2x7.2

(890.1-895.1), (900.1-902.1)

(935.1-940.1), (945.1-947.1)

1,362.41

Feb-14

Madhya
Pradesh

2x2.5

(1738-1739.25), (1740.5-1741.75)

(1833-1834.325), (1835.5-1836.75)

1,079.80

Nov-12

Maharashtra 2x1.25

1760.05-1761.3

1855.05-1856.3

2,628.10

Nov-12

Mumbai

(1754.1-1759.1), (1717.9-1718.1), (1761.9-1764.9) (1849.1-1854.1), (1812.9-1813.1), (1856.9-1859.9) 2,230.40

Feb-14

Vodafone Andhra
Pradesh

2x8.2

24

Operator Circle

Block
(MHz)

Uplink (MHz)

Downlink (MHz)

Price
(INR m)

Auction

Mumbai

2x11

(890.1-900.1), (906.7-907.7)

(935.1-945.1), (951.7-952.7)

6,193.99

Feb-14

North East

2x2.5

(1739-1740.25), (1742.75-1744)

(1834-1835.25), (1837.75-1839)

88.40

Nov-12

Orissa

2x2.5

(1715.2-1716.45), (1718.95-1720.2)

(1810.2-1811.45), (1813.95-1815.2)

405.40

Nov-12

Punjab

2x1.25

1755.65-1756.9

1850.65-1851.9

672.80

Nov-12

Punjab

2x0.6

1750.1-1750.7

1845.1-1845.7

32.40

Feb-14

Rajasthan

2x0.8

1736.1-1736.9

1831.1-1831.9

20.80

Feb-14

Uttar
Pradesh
East

2x1.25

1742.2-1743.45

1837.2-1838.45

761.70

Nov-12

Uttar
Pradesh
East

2x4

(1722.3-1722.7), (1733.3-1735.9), (1749.3-1750.3) (1817.3-1817.7), (1828.3-1830.9), (1844.3-1845.3) 256.00

Feb-14

Uttar
Pradesh
West

2x2.5

(1719.2-1720.45), (1780.2-1781.45)

(1814.2-1815.45), (1875.2-1876.45)

2,148.20

Nov-12

West
Bengal

2x2.5

1762.1-1764.6

1857.1-1859.6

516.80

Nov-12

Sources: DoT, TRAI

25

Wireless Regulatory Timeline

1995 Bharti launches AirTel mobile service in Delhi; Hutchison rolls out GSM
network in Mumbai
1997 Telecoms Regulatory Authority of India Act passed
20 January 2000 TRAI Act amended
2002 Limited mobility WiLL services cause uproar as cellcos deem the 'fixed line'
services to be illegal
October 2002 BSNL enters the GSM mobile sector in a blaze of publicity
May 2003 Long overdue convergence legislation is again delayed and put on the back
burner
June 2003 Introduction of calling party pays (CPP)
November 2003 Unified licences awarded at circle level; Reliance introduces national CDMA
roaming services
February 2004 Tata launches national CDMA roaming
May 2004 Bharti acquires GSM rival Hexacom
August 2004 Reliance launches international CDMA roaming
December 2004 National unified licensing framework due to come into effect, but deadline is
missed
February 2005 Tata rolls out CDMA services to all 20 of its circles; Hutchison's attempted
takeover of GSM provider Aircel fails to receive regulatory approval
July 2005 TRAI opens up consultation on mobile number portability (MNP)
October 2005 Vodafone takes 10% stake in Bharti Tele-Ventures
December 2005 Maxis Communications acquires Aircel
January 2006 Hutchison Essar acquires BPL Communications; Tata Teleservices
becomes first cellco to introduce One India tariff
March 2006 New spectrum policy announced; Bharti Tele-Ventures becomes Bharti
Airtel; BSNL and MTNL strike network sharing deal; Telekom Malaysia
takes 49% stake in Spice
April 2006 Aditya Birla agrees takeover of Idea Cellular
May 2006 Cellcos agree to stop selling pre-activated SIM cards in a bid to address
security issues concerning unregistered mobile phone use
June 2006 BSNL launches so-called 'mega tender' for 60 million lines
September 2006 TRAI reveals 3G spectrum auction plans; hands BSNL spectrum for indoor
3G tests
November 2006 DoT says 3G services could be launched as early as mid-2007; agrees to
give UMTS spectrum to seven cellcos for pilot services
December 2006 Government passes legislation allowing Universal Services Obligation Fund
(USOF) to be used for rural mobile networks.

26

April 2007 TRAI issues recommendations on infrastructure sharing

May 2007 Vodafone Group completes takeover of Vodafone Essar (formerly Hutchison
Essar)
October 2007 DoT accepts TRAIs recommendation that no cap be placed on the number
of mobile operators; successful trial of co-existing 1900MHz CDMA2000
and 2100MHz W-CDMA systems
November 2007 DoT confirms that 3G licences will be distributed via auction, open to
foreign companies
January 2008 DoT approves nine applicants for UASL licences, and grants existing
cellcos permission to receive new 2G spectrum; TRAI urges MoC to speed
up the 3G licensing process, and releases mobile TV licensing
recommendations
July 2008 DoT approves TRAI proposals for auctions of 3G spectrum, confirming that
foreign bidders would be allowed
July 2008 State-owned cellcos BSNL and MTNL allocated 3G spectrum
August 2008 DoT releases new mobile number portability (MNP) guidelines
October 2008 TRAI reveals proposals to charge wireless infrastructure companies a
licence fee
October 2008 3G auction process delayed
November 2008 DoT increases levy on operators holding more than 6.2MHz of spectrum
November 2008 DoT announces that it will not issue any new mobile licences, citing
adequate competition in the market
February 2009 First commercial 3G services launched by MTNL in Delhi and BSNL in
twelve cities
October 2009 MTS India launches CDMA EV-DO wireless data services
December 2009 Two new GSM players Uninor and STel begin operations
February 2010 TRAI issues pre-consultation paper on 4G services
February 2010 DoT announces increased spectrum charges for GSM and CDMA operators
March 2010 TDSAT releases an interim order halting the DoTs proposed spectrum levy
increase
March 2010 Videocon Telecommunications launches 2G GSM services
April 2010 3G auction process officially starts
May 2010 Seven operators walk away with 3G licences as sale process concludes
September 2010 DoT allocates 3G spectrum
November 2010 Mobile number portability launched in Haryana
November 2010 TTSL becomes the first private operator to launch commercial 3G services
January 2011 MNP goes nationwide
February 2011 TRAI puts forward new recommendations for the cost of start-up spectrum
for new 2G operators

27

March 2011 Idea Cellular and Vodafone Essar begin offering third-generation services
March 2011 The DoT calls for the cancellation of Etisalat DBs concessions in the
Mumbai and Delhi circles, as well as Idea Cellulars Punjab licence
April 2011 DoT fines Idea, Spice for alleged rollout delays
July 2011 TDSAT orders DoT to allocate GSM spectrum in Delhi to TTSL with
immediate effect.
July 2011 Essar Group sells stake in Vodafone Essar
October 2011 DoT rules that 3G roaming agreements are illegal, operators call on TDSAT
to intervene
2 February 2012 Supreme Court cancels 122 2G licences issued in 2008 over allegations of
corruption
February 2012 STel and Etisalat begin closing down operations
April 2012 Bharti Airtel launches first LTE network in India
April 2012 TRAI publishes proposals for spectrum auction
May 2012 Bharti buys 49% of Qualcomms Indian operations
November 2012 DoT holds auction for cancelled licences, awards spectrum to five cellcos,
spectrum in metros and Rajasthan left unsold
March 2013 Sole bidder Sistema secures spectrum in eight circles in second round
auction for cancelled licences
April 2013 Supreme Court rules that inter circle 3G roaming is not permitted
October 2013 Airtel completes acquisition of Qualcomms Indian unit Wireless Business
Services
January 2014 Government approves refund for BSNL/MTNLs BWA spectrum
February 2014 DoT auctions additional 1800MHz and 900MHz spectrum; Airtel, Vodafone,
Aircel, Idea, Jio, RCOM and Uninor win concessions
April 2014 TDSAT rules in favour of 3G roaming agreements
2H 2014 RJIL expected to commercially launch; Videocon to activate LTE1800
network.

Broadband Regulatory Overview

Regulatory Bodies
Department of Telecommunications (DoT)
20 Ashoka Road
Sanchar Bhawan
New Delhi 110001
India
Tel. +91 11 23716874

28

Fax +91 11 23353303

http://www.dotindia.com

Telecoms Regulatory Authority of India (TRAI)

A2/14, Safdarjung Enclave
New Delhi 110029
India
Tel. +91 11 26103294
Fax +91 11 26103294
http://www.trai.gov.in

Department of Information Technology (DoIT)

6, CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +91 11 24363094
Fax +91 11 24362628
http://www.mit.gov.in

Ministry of Communications (MoC)

6 CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +91 11 24363094
Fax +91 11 24362628
http://www.moc.gov.in

Department of Electronics and Information Technology (DeitY)

Ministry of Communications & IT
Electronics Niketan, 6 CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +91 11 24364041
Fax +91 11 24363134
http://deity.gov.in
Current Status of Local Loop Unbundling: Pre-commercial

Broadband Key Legislation

Internet service provider (ISP) licences are either nationwide ('pan-India') or regional (for
one or more of the country's 22 telecoms circles). According to the Telecoms Regulatory
Authority of Indias (TRAIs) most recent data, it had issued a total of 143 ISP licences as at
December 2013, 134 of which were active. Communications providers with a range of other

29

licences may also offer internet services: Basic Services (two operators state-run telcos
Bharat Sanchar Nigam Ltd [BSNL] and Mahanagar Telephone Nigam Ltd [MTNL]), Public
Mobile Radio Trunked Services (PMRTS, six licensed), Very Small Aperture Terminal
(VSAT, nine licensed and all in operation). Meanwhile, the international gateway services
market is home to increasing competition, with a series of foreign multinationals obtaining
licences in recent years to join the incumbents Tata Communications, BSNL, Reliance
Communications (RCOM) and Bharti Airtel (see Wireline section).
In October 2006 the state approved plans to utilise the Universal Service Obligation Fund
(USOF) to ramp up the availability of broadband internet and mobile telephony services in
rural and remote areas. Projects backed by the fund include the operation and maintenance
of Village Public Telephones (VPTs), the construction of mobile infrastructure and the
provision of broadband connectivity in rural areas.
Further efforts to increase the availability of broadband services came in December 2010
when the TRAI unveiled its National Broadband Plan, which included a proposal for
the construction of a national broadband network costing around INR600 billion (USD13
billion). The regulator advocated the construction of an open access fibre-optic network to
connect all cities, towns and villages with a population of more than 500, with funding
to come via the USOF and a loan from the government. Other elements of the legislative
proposals included: the call for a state-run agency, the National Optical Fibre Agency
(NOFA), to be set up to oversee the project, while a State Optical Fibre Agency (SOFA)
would be created for every state, with 51% held by the NOFA and the remaining equity
held by the respective state government. The plan faced the usual regulatory hold ups,
however, and stalled in mid-2011, though momentum was renewed a year later following the
acceptance of the National Telecom Policy 2012 (NTP 2012), which enshrined broadband
access as a basic necessity, on par with education and health. Consequently, late-June 2012
saw the creation of a government committee tasked with pushing the construction of a
National Optical Fibre Network (NOFN), to be managed by new state-owned telco Bharat
Broadband Network Ltd (BBNL), created specifically for the task. The budget of the project
has been scaled down somewhat though, with it now aiming to connect some 200,000 villages
and small towns, at a cost of INR200 billion. The project made further headway in February
2014, with BBNL securing USOF assistance for the deployment and upkeep of a fibre-optic
transport network capable of providing 100Mbps of bandwidth to 250,000 Gram Panchayats
(small villages/towns). The agreement is valid for five years.
Spectrum for indoor Wi-Fi internet services was cleared for use in August 2004, with
outdoor frequencies following in January 2005. Following recommendations from the TRAI
to free up 300MHz for Broadband Wireless Access (BWA) services by 2010, the Department
of Telecommunications (DoT) chose four bands for licensed BWA (WiMAX) services:
700MHz,
2.3GHz-2.4GHz,
2.5GHz-2.69GHz
and
3.4GHz-3.6GHz.
The
5.825GHz-5.875GHz band was de-licensed in February 2007, with ISP Sify launching
5.8GHz fixed wireless access (FWA) services that month, and in July 2007 the DoT proposed
issuing three 2.5GHz licences. Several operators have also rolled out WiMAX 802.16-2004
services using existing frequencies assets, including cellco Aircel (3.3GHz) and Tata
Communications (3.4GHz).
The DoT began the process of auctioning BWA (including WiMAX) licences in November
2007, but disagreements, primarily over reserve prices, between the regulator and the Finance
Ministry caused considerable delays. Consequently, the auction did not get underway fully
until March 2010, when 28 companies purchased the tender documents. Of these, eleven
successfully applied to submit bids, those being: Tikona Digital, Qualcomm, Tata
Communications, Vodafone India, Idea Cellular, Bharti Airtel, Aircel, Spice
Communications, Augere, Quadrant Televentures (then HFC Infotel) and RCOM. By the end
of the month all eleven had been granted final regulatory approval to bid, with the DoT also
revealing that Qualcomm and HFCL would bid for pan-India BWA spectrum, while Augere,
Tikona Digital and Spice Communications would only apply for certain regions. The sale

30

itself finally began in late-May 2010, and with the bidders competing for two blocks of
wireless broadband spectrum of 20MHz each in the 2.3GHz band, the state said it expected
to raise up to INR150 billion from the auction. In the event, the BWA auction came to an
end around three weeks later, and unlike the 3G auction one company did walk away with
a pan-India concession. Infotel Broadband Services won BWA licences for all 22 of Indias
telecoms circles, paying INR128.48 billion for the privilege, while mobile network operator
Aircel bagged the next largest number of BWA concessions, eight, for a total of INR34.38
billion. Tikona Digital Networks paid INR10.58 billion for five licences meanwhile, and
rounding out the winners were US-based chipmaker Qualcomm and Indias largest cellco by
subscribers Bharti Airtel with four licences apiece, costing INR49.13 billion and INR33.14
billion, respectively, and Augere, which claimed just one concession for INR1.25 billion.
Qualcomms local units were taken over by Airtel in October 2013, whilst Infotel was
purchased by Reliance Industries Ltd (RIL) in June 2010 before being renamed Reliance Jio
Infocomm Ltd (RJIL). Augere, meanwhile, threw in the towel, withdrawing from the market
in 2012 citing regulatory uncertainty in the wake of the mass cancellation of 2G licences in
February that year.
In January 2008 the TRAI issued recommendations on the provision of IPTV services. Under
the recommendations, telecoms operators owning the respective licences to provide tripleplay services and ISPs with net worth of more than INR1 billion can provide IPTV services
under their existing concessions, subject to permission from the DoT. Similarly, cable TV
operators can offer IPTV without requiring any further licences. Telcos providing IPTV will
be subject to contributing a percentage of adjusted gross revenue (AGR) as licence fees.
In September 2012 the TRAI directed ISPs to improve transparency regarding the provision
of broadband services. Telcos were instructed to ensure that broadband connections are not
reduced below the minimum speed specified by the plan and to inform customers when data
usage reaches 80% and 100% of their limit. The move was reportedly a response to consumer
complaints that telcos were not providing customers with adequate information on their plans
and Fair Usage Policies (FUPs).
More recently, telecom industry players called for the government to develop uniform
guidelines on the approval process for installing fibre-optic cables at an open forum hosted
by the TRAI in June 2014. Right of Way (RoW) permissions, required to build fibre-optic
infrastructure, are currently regulated by multiple local agencies with huge variations in cost,
making deployment expensive or unviable in some areas. Representatives from a number
of operators have requested that the DoT treat optical fibre infrastructure as a resource of
national importance and issue uniform guidelines to facilitate faster RoW clearances and
more reasonable charges. Such measures would help encourage the installation of fibre
systems, which are crucial to meeting the rising demand for data services, the operators
claimed.

Local Loop Unbundling

India's local telephony market was liberalised in 1997 and two years later the National
Telecom Policy 1999 (NTP 1999) set out local loop unbundling (LLU) obligations to
be applied to state-run incumbents Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar
Telephone Nigam Ltd (MTNL). The measures were not backed by the Ministry of
Communications (MoC) however, and therefore never enforced. The Telecoms Regulatory
Authority of India (TRAI) continued to push for LLU, but the MoC remained resolutely
against its implementation. 'Wireless [broadband] is the way to go and worldwide we have
seen unbundling of the local loop has not been successful, so I have stated time and again that
there is no need for unbundling,' the then Communications Minister Dayanidhi Maran said
in July 2006. Later that month the DoT appeared to fall in line, saying it similarly believed
that LLU had not succeeded in most developed countries. Those in favour of LLU, however,

31

suggested that the MoCs stance was, in part, motivated by the government's interest in the
two state-owned telcos. Little progress has been reported since, and despite the publication
of the National Telecom Policy 2012 (NTP 2012) in mid-2012 this made no mention of future
plans for the introduction of LLU.
Meanwhile, to prevent anti-competitive behaviour by the incumbents, the TRAI is
empowered to fix tariffs for telecommunication services under Section 11(2) of TRAI
Act of 1997 as amended in 2000 and the Telecommunication Tariff Order 1999 (TTO,
1999). Further, the regulator determines the conditions for interconnectivity between service
providers.

Wireline Regulatory Overview

Regulatory Bodies
Department of Telecommunications (DoT)
20 Ashoka Road
Sanchar Bhawan
New Delhi 110001
India
Tel. +91 11 23716874
Fax +91 11 23353303
http://www.dotindia.com

Telecoms Regulatory Authority of India (TRAI)

A2/14, Safdarjung Enclave
New Delhi 110029
India
Tel. +91 11 26103294
Fax +91 11 26103294
http://www.trai.gov.in

Ministry of Communications (MoC)

6 CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +91 11 24363094
Fax +91 11 24362628
http://www.moc.gov.in

Dates of Liberalisation
Local Telephony: Jan 1997
Domestic Long-distance Telephony: Sep 2000
International Telephony: Apr 2002

32

Wireline Key Legislation

The 1994 National Telecoms Policy (NTP 1994) laid out guidelines concerning private
investment in the telecoms sector, including foreign direct investment (FDI), and paved
the way for the licensing of the first commercial local telephony operators in 1997. Bharti
Airtel (formerly Bharti Tele-Ventures), HFCL Infotel (now Quadrant Televentures), Hughes
Tele.com, Reliance Communications (RCOM) and Tata Teleservices (TTSL) all won licences
that year. The domestic long-distance and international long-distance (DLD and ILD) sectors
were subsequently liberalised in 2000 and 2002, respectively.
In November 2003 the Telecoms Regulatory Authority of India (TRAI) introduced Unified
Access Services Licences (UASLs), which cover the provision of any type of communication
service in a specified circle (although wireless spectrum must be applied for separately).
Prior to this, all operating licences stipulated the technology used to provide the service as
well as region. By the of end of June 2014 all five of the country's privately-owned fixed line/
CDMA wireless in the local loop (WiLL) local telephony providers had converted their Basic
Fixed services concessions to UASLs. At that date, there were also 31 operators licensed to
provide DLD services, and 24 to provide ILD.
The TRAI has long seen the DLD/ILD sector as one in which competition could be improved,
and in a further bid to stimulate the segment it announced a drastic revamp of licensing
in January 2006. Under the scheme licence fees for long-distance services were reduced
substantially, with the initial cost of both DLD and ILD concessions cut to INR25 million
(USD547,000); previously DLD and ILD licences had cost INR1 billion and INR250 million,
respectively. Further, the annual licence fee for long-distance operators was also slashed
from 15% of annual gross revenue (AGR) to 6%. At the same date the state relaxed
its licensing process and gave permission for non-telecoms operators owning fibre-optic
networks, including energy utilities and IP VPN operators, to enter the DLD/ILD market,
while a further relaxing of licensing conditions now allows DLD service providers to offer
services directly over their own last-mile infrastructure. A total of 18 companies submitted
applications for either a DLD or ILD concession immediately following the relaxation of
entry requirements; prominent among the 2006 DLD/ILD licensees was US giant AT&T,
followed in 2007/08 by two major UK-based operators, BT Group and Cable & Wireless,
with another US luminary, Verizon, bagging licences in November 2007. Orange Group
(formerly France Telecom) subsequently obtained DLD and ILD licences in June 2008, while
Singapore Telecom (SingTel) acquired its concessions in March 2009 via its 74%-owned
subsidiary SingTel Global India.
In January 2010 however it was announced that foreign operators could face combined
penalties of up to INR1.1 billion amid claims that they had operated illegally by offering
services before receiving the necessary licences. The Ministry of Communications (MoC)
was reported to have set up a committee to examine the matter, claiming that telcos
circumvented licensing norms by offering services [in India] prior to 2006 without licences,
which it argued had led to financial losses for the government. Having considered the
responses of the foreign firms accused of such wrongdoing, the committee recommended that
AT&T be slapped with an INR860 million penalty, while BT and Equant (part of Orange
Group) faced INR120 million fines, and Verizon was threatened with a smaller charge of
INR500,000. All of the accused denied any wrongdoing, claiming that they did not provide
services directly to customers in India at the time, nor were they required to take licences,
as the services were offered by their Indian partners. A previous DoT committee which
had been formed to examine the issue had alleged that international operators had provided
long-distance services to customers in India by tying up with Indian counterparts leading
to huge losses in levies to the exchequer. It argued that these foreign players had not paid
the one-time entry fee of INR250 million (prior to 1 January 2006) plus 15% of their AGR
as levies for offering long-distance services in India. The DoT subsequently called on the

33

Central Bureau of Investigation (CBI) to study the matter, which in publishing its findings
said evidence pointed to a cognizable offence. The committees report, which called for
financial penalties, was submitted to the DoT on 15 December 2009, at which date local
partners of the aforementioned operators, such as Bharti Airtel, Tata Communications and
RCOM, were informed that they would not be investigated with reference to the matter. No
final ruling had been issued in the matter as at 30 June 2014.
September 2010 meanwhile saw the DoT confirm it had accepted a request from BT to
surrender its DLD licence, with the regulator stating that the British firm would not be
refunded its entry fee for the concession. It was reported that BT had first approached the
DoT with a view to handing back its DLD licence in 2008 after it purchased i2i Enterprise in
2007, which held a long-distance concession of its own; BT is now using i2is DLD licence
for operating its service in India. The regulator also reportedly said that BTs Performance
Bank Guarantee (PBG) of INR25 million would be forfeited, although the Financial Bank
Guarantee of INR200 million was to be released back to the company.
From 30 September 2008 there was no longer an access deficit charge (ADC) a
controversial levy introduced in May 2003 to fund the subsidy of unprofitable rural lines
and in its place it was decided that the Universal Service Obligation Fund (USOF) would
provide BSNL with INR20 billion per annum as a subsidy for sustaining fixed lines installed
before 1 April 2002; the subsidy ran for three years and has since been replaced by a January
2009 deal to roll out rural broadband lines.

VoIP Legislation
Voice-over-internet protocol (VoIP) local, DLD and ILD telephony services were approved
in April 2002. Under India's VoIP regulations there are three types of internet telephony
calls: computer to computer; computer to mobile or fixed line; and between mobile and
fixed lines. Only Unified Access Service Licence (UASL) holders are permitted to offer all
three types of VoIP services, while internet service providers (ISPs) are allowed to offer
only computer to computer and computer to fixed/mobile lines. According to the Telecoms
Regulatory Authority of India (TRAI) there were 33 ISPs offering VoIP at the end of
December 2013.
In September 2009 Indias Intelligence Bureau (IB) called on the Ministry of
Communications (MoC) to block all internet telephony services in and out of the country
until the Department of Telecommunications (DoT) was able to track such calls. The IB
claimed that India lacked the necessary technology to track VoIP calls, and argued that this
presented a national security issue, noting: In the absence of Caller Line Identification (CLI)
parameters of calls landing from abroad, it is next to impossible to identify the country of
location of the caller. Moreover, of late a number of service providers in India have started
providing VoIP solutions for making calls both domestic as well as foreign. The calls passing
through the VoIP/IP route contain inadequate parameters rendering it impossible to trace the
actual callers. As [the] DoT had conveyed that it is not possible to mandate transmission of
CLI from abroad, we had approached [the] DoT to block such calls till a technical solution
is found. In March 2014 unconfirmed reports claimed that under new standard operating
procedures, telcos are obliged to provide for the lawful interception and monitoring on a
range of communications, including VoIP.
Meanwhile, it appears that the regulator plans to encourage the uptake of VoIP, as part of a
drive to increase penetration of telephony services. The National Telecom Policy (NTP) 2012
included as one of its objectives for licensing, convergence and value added services (VAS):
to enable and enforce the VoIP facility to enhance consumer affordability.

34

Wireline Regulatory Timeline

1985 BSNL (then part of the DoT) licensed to provide local and long-distance
telephony services
1986 MTNL wins local and long-distance licence; VSNL licensed to provide
international telephony
1994 National Telecoms Policy (NTP) clears the way for private investment
throughout the sector
1997 Local call market opened up to competition; Bharti Tele-Ventures, HFCL,
Hughes Tele.com, Reliance Telecom and Tata Teleservices all win licences
1998 Shyam Telelink licensed to provide local services
1999 Tata launches fixed line services in Andhra Pradesh; first LLU measures
proposed; New Telecoms Policy 1999 created
September 2000 Domestic long-distance market opened up to competition
2001 Bharti Tele-Ventures awarded national long-distance licence
April 2002 International market liberalised; Bharti Tele-Ventures, Data Access and
Reliance Infocomm licensed to operate in the sector
March 2003 Reliance launches international voice services
July 2003 TRAI reveals plans to award combined wireline/wireless concessions
November 2003 Government approves TRAI's unified licensing proposal and begins
implementation of first phase, converting existing concessions to unified
licences at circle level
July 2004 Government announces plans to raise bar on foreign direct investment (FDI)
to 74%
October 2004 Data Access disconnected from BSNL's network for failure to pay
interconnect fees
January 2005 Unified regulatory framework due to come into effect, but deadline is missed
February 2005 State plan to lift FDI cap approved by the union Cabinet
June 2005 Data Access' international long-distance licence suspended indefinitely
October 2005 FDI cap raised from 49% to 74% after approval from federal Cabinet ; new
draft telecoms policy revealed
1 January 2006 National and international long-distance licence fees lowered
March 2006 Bharti Tele-Ventures becomes Bharti Airtel
June 2006 PowerGrid, Railtel and Oil India each receive long-distance telephony
licences
October 2006 AT&T Global Network Services India Private becomes first foreign telecom
operator in India to secure domestic and international long-distance
licences, following new policy on foreign direct investment allowing up to
74% overseas ownership; Aircel launches WiMAX services
February 2007 BT Group wins DLD and ILD licence; Sify launches WiMAX services

35

April 2007 AT&T launches services

June 2007 Tata Communications (VSNL) and Reliance launch WiMAX services
November 2007 Verizons application for DLD and ILD licences approved
December 2007 VSNLs shareholders approve change of name to Tata Communications
January 2008 DoT approves at least nine pending applications for UASLs after deciding
not to limit the number of operators
February 2008 Cable & Wireless awarded DLD and ILD licences
March 2008 TRAI announces Access Deficit Charge (ADC) to be phased out by
September 2008
June 2008 France Telecom (Orange Business Services) receives DLD and ILD
licences
June 2008 BSNL pulls out of submarine cable plan for new Asian links (MTNL remains)
July 2008 Rural fixed line licence fee waived by the DoT
September 2008 Access Deficit Charge removed following phase-out
March 2009 SingTel granted ILD and NLD licences
March 2009 Three-year lock-in on stakes in new telcos mooted
March 2009 Idea Cellular enters ILD sector, routing international calls with Sri Lankas
Dialog Telekom
March 2009 TRAI announces new interconnection usage charges reducing the
termination charge for all types of domestic calls to INR0.20 per minute,
down from INR0.30 per minute
July 2009 DoT introduces three-year lock in on stake sales by new operators
January 2010 Foreign operators including AT&T, BT and France Telecom reportedly face
combined penalties of up to INR1.1 billion amid claims that they had
operated illegally by offering services in the country before receiving the
necessary licences
February 2011 DoT revives proposal to merger BSNL and MTNL
April 2012 ILD excluded from TRAI tariff controls
May 2012 NTP 2012 approved, enshrining right to broadband
June 2012 Committee created to oversee NOFN development
April 2013 Telecoms minister calls for government to rescue state-backed telcos
July 2013 Committee to present proposed bailout package for BSNL and MTNL to
government
September 2013 Government agrees to take on pension payment responsibilities of MTNL
February 2014 Bharat Broadband Network Ltd (BBNL) and Universal Service Obligation
Fund (USOF) sign agreement for backing of National Optical Fibre Network
(NOFN).

36

Wireless
Market Commentary
The second most populous nation in the world, Indias wireless market is also the second
largest after China, although the numerous problems that plague the sector have kept cellular
penetration comparatively low, leaving plenty of room for future expansion. As at end-March
2014, India was home to some 904.65 million mobile users, up from 863.63 million a year
earlier and 903.38 million in March 2012, whilst penetration stood at 72.8% compared to
70.4% and 74.6% in the previous two years. The massive potential for growth has attracted a
substantial amount of interest in Indias wireless sector over the years, but poor management
of spectrum resources, regulatory incompetence, corruption and political interference have
hindered the progress of the sector. Perhaps the most obvious problem facing Indian cellcos
is the level of overcrowding in the market, even with the reduction in the number of players
since 2012. At the end of March 2014 there were 13 cellcos competing for market share, and
while one is expected to close down in the second half of 2014, a new player is due to launch
in that same time period (see below). As at June 2014 the nations active carriers were; Bharti
Airtel, UK-backed Vodafone Group, Idea Cellular, Reliance Communications (RCOM),
state-run providers Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam
Ltd (MTNL), Tata Teleservices (TTSL), Aircel, Russian-owned Sistema Shyam TeleServices
Ltd (SSTL), Norwegian-backed Uninor/Telewings, Videocon Telecommunications, Quadrant
Televentures and Loop Mobile.
Airtel led the market at the end of March 2014 claiming 205.52 million subscribers, or 22.7%
of the market, followed closely by Vodafone with 18.4% and 166.56 million customers. Idea
meanwhile represented 15.0% of the market, having expanded from 14.1% a year earlier,
whilst RCOMs share dipped to 12.3% from 14.2% as the provider continued its policy
of disconnecting low-value inactive users from its customer base. Trailing behind the lead
pack, BSNL, Aircel and TTSL have near-national footprints and held market shares of
10.5% (down from 11.3% year-on-year), 7.8% (7.0%) and 7.0% (7.7%), respectively. Owned
by Norwegian provider Telenor, Uninor/Telewings claimed 3.9% of the sector, despite its
limited footprint, with operations in just six circles none of which are the three metro
circles. The cellco is arguably the most successful of the more recent market entrants and
after disconnecting nearly ten million subscribers in early 2013 as it cut back on the number
of areas in which operated, the provider has since reported steady growth, adding around
four million net new customers in 2013. Its Russian-owned rival SSTL, which offers services
under its parents MTS brand has had a less easy time of it, shedding subscribers throughout
2013, after it performed a similar down-sizing. By end-March 2014 the CDMA provider
claimed 9.04 million users compared to 11.91 million in March 2013 equating to around
1.0% of the space, down from 1.4% twelve months previously.
Following allegations of corruption centring on the allocation of 2G spectrum in 2008,
in February 2012 the Supreme Court issued a ruling cancelling all licences a total of
122 issued through the tainted auction. The decision was made after investigations by
several of Indias law enforcement bodies uncovered substantial evidence of corruption and
mishandling of limited spectrum resources. The probe found that the conditions of the sale
were altered at the last minute to ensure that only those informed of the changes would
be able to purchase licences and that the spectrum was sold far below its actual value,
resulting in the loss of trillions of rupees in potential earnings for the state (see Wireless
Key Legislation for full details). The Supreme Courts ruling revoked the concessions of
Videocon (21), Uninor (22, allocated to various subsidiaries of Unitech), Idea Cellular (13,
four of which originally allocated to Spice Communications), Loop Telecom (21), STel (six),

37

SSTL (21), TTSL (three), Etisalat DB (13, allocated to the telco under its previous Swan
brand) and Allianz (two).
In the fallout from the mass cancellation, Bahrain Telecommunications Company (Batelco)
and Etisalat backed out of the market, abandoning their respective STel and Etisalat DB
(EDB) units. Shutting the door after the horse had bolted, in April 2013 the DoT ordered
STel and Etisalat to continue providing services until the Supreme Courts order came into
effect at that time set at 2 June 2012, but subsequently pushed back to March 2013 on
the grounds that the cellcos had not complied with the terms of their licences, specifically
their obligation to inform consumers and authorities 60 days ahead of terminating operations.
Unsurprisingly, neither operator complied with the order, and indeed the matter proved to
be the final straw for the UAE company, which immediately ruled out a future return to the
market. Meanwhile, Loop Telecom also announced that it was closing down, but toed the
line on its licence obligations and put off a network switch-off until early May 2012. At the
time of announcing its plans to close Loop Telecom had launched in 13 circles, though it
had only managed to sign up a total of 6,172 subscribers, most of which (2,369) were in
Kolkata, whilst Uttar Pradesh West had seen the least success, with just eight subscribers in
that region. The closure of Loop Telecom ultimately dragged sister company Loop Mobile
down with it, and in February 2014 it was announced that the remaining Mumbai-based
business would be sold to Bharti Airtel, although the sale process has encountered its share
of difficulties (see Loop Mobile profile for details).
In contrast to Etisalat and Batelco, Telenor and Sistema, the parent companies of Uninor
and SSTL respectively, fought tooth and nail with the government to have their licenses
reinstated. The duo were understandably frustrated with the Indian government and
regulators, having seen little benefit from the low price of the concessions; both had
purchased stakes in their respective businesses at an inflated price post-auction, but were
forced to face the consequences of their partners actions. Making matters worse, with
the Department of Telecommunications (DoT) and Telecom Regulatory Authority of India
(TRAI) reluctant to be accused of depriving the state of funds, they set excessively high
prices for the affected cellcos to repurchase their spectrum. When the licences were finally
re-auctioned in November 2012, the turnout was understandably poor: stricken cellcos
Videocon, Idea Cellular and Telenor the latter bidding through new joint venture Telewings
participated in the sale process alongside incumbents Bharti and Vodafone, but no new
providers stepped in to plug the gaps left by Etisalat, STel and Loop. Further, regulatory
uncertainty prompted returning providers to bid conservatively. From its previous licenced
footprint of 22 circles, Telewings cut back to just six circles, as did Videocon, whilst Idea
took concessions in eight areas. With the highest-priced areas left untouched and only one
circle receiving bids above the minimum, the sale brought in a total of INR94.1 billion
(USD2.024 billion) for state coffers, less than a quarter of the INR400 billion target. Rather
than attempting to offer services nationwide, operators targeted a handful of areas seen as
having high growth potential and low spectrum costs.
Conspicuous by its absence in the November 2012 auction, SSTL had pinned its hopes of
continuing in India on an appeal to the Supreme Court. With the operator partially owned by
the Russian Federation, it was confident of having its licences returned, but such confidence
proved misplaced, with the Supreme Court rejected SSTLs plea in February 2013. Rather
than leave the cellco and its roughly 15 million subscribers high and dry, the apex court
did however allow SSTL to continue offering services, until a second attempt at selling the
spectrum was launched in March 2013. In the interim, the cellco closed down its operations in
ten circles in a bid to cut costs, noting that the uncertainties from the licence cancellation had
prompted it to conserve its resources. Services were terminated in Assam, Andhra Pradesh,
Bihar, Himachal Pradesh, Haryana, Jammu & Kashmir, Madhya Pradesh, North East, Orissa
and Punjab, although the provider noted that these circles made up less than 15% of its total
subscriber base. Subsequently, SSTL proved to be the only cellco interested in participating
in the second auction, in which it won rights to airwaves in eight circles. Following a similar
strategy to Telenor, the provider noted that it had taken into consideration spectrum pricing,

38

the level of competition, future potential for data services and the number of carrier slots
available in its selection.
A subsequent round of auctions in February 2014 featuring frequencies held through soonto-expire licences saw greater participation, although for several bidders participation was
all but compulsory, with them facing forced closure if they were unable to win back their
spectrum rights. Indeed, newcomer Reliance Jio Infocomm Ltd (RJIL) took the opportunity
to pressure incumbents Bharti Airtel and Vodafone, bidding aggressively for their 900MHz
frequencies and driving up the price tag for the concessions. This pattern is likely to continue
over the coming years with nearly 30 licences held by Idea, Airtel and Vodafone due to expire
in between 2015 and 2016 and the regulator preparing to auction additional unsold spectrum
and airwaves in new frequency ranges, such as the 700MHz band. For its part, RCOM has
revealed that it intends to capitalise on the financial burden its competitors will shoulder to
repurchase their licences by stepping up pricing competition in the busiest and most lucrative
areas.
The market is expected to see a shake-up in the second half of 2014, however, with the
arrival of a new player RJIL, the telecoms arm of petrochemical giant Reliance Industries Ltd
(RIL), owned by Mukesh Ambani, the brother of RCOM owner Anil Ambani. RIL entered
the market in 2010 through its acquisition of Infotel Broadband, which had been the only
operator to win pan-India rights to Broadband Wireless Access (BWA) spectrum in that
years tender. The renamed Jio soon revealed plans to use the 2300MHz-band frequencies
to deploy a Time Division Long Term Evolution (TD-LTE) network, before announcing
it would augment this with a Frequency Division (FD)-LTE platform using the 1800MHz
spectrum purchased in February 2014. Backed by the financial might of RIL, RJIL has looked
to muscle in on the market with as much impact as possible and to that end has signed
infrastructure sharing agreements with a host of providers in addition to rolling out its own
networks. Several such deals were signed between Jio and RCOM covering telecom towers
and inter and intra-city fibre optic networks sparking concerns that the respective divisions
of the two Ambani brothers would look to cooperate more closely, with rumours emerging
in mid-2014 that RCOM would open up its 800MHz and 2100MHz spectrum to RJIL. The
former band in particular is of interest to Jio, as its propagation characteristics would enable
it to improve indoor coverage. More troubling to the incumbents, however, is the prospect
of a fresh competitor arriving when they can ill-afford another price war; previous tit-forta tariff reductions, most recently in 2012, saw operators average revenue per user (ARPU)
crash to unsustainable levels.
Regulatory uncertainty, combined with difficult market conditions have undermined investor
confidence, a situation made only worse by the dire financial difficulties experienced by a
number of providers, leading many to trim investment and limit expenditure. These limits
have led to a marked disparity between levels of rural and urban cellular penetration, with
operators opting to concentrate on more lucrative urban users than risk the costly expansion
into outlying areas. Whilst Indias population is largely rural more 830 million compared
to roughly 380 million in the cities the lions share of mobile users are based in urban
areas to the extent that cellular penetration in cities has reached near saturation point, whilst
roughly half of the rural population is unserved. According to data published by the TRAI,
in December 2013 there were 365.79 million subscriber in rural areas compared to 549.4
million in urban locations with respective teledensities of 42.67% and 144.95%; the situation
is improving, however, with rural teledensity having risen from 39.85% in December 2012.
Whilst government-funded universal service projects are no doubt linked to the progress, the
migration of smaller competitors Uninor and SSTL to the less densely-populated circles is
also likely to have played a part in the sectors development. Indeed, Uninor boasts that its
success in such markets demonstrates that investment in low-ARPU areas with a high demand
for services is financially viable.
Elsewhere, Indias data market has begun to flourish, as 3G services have become more
affordable. Decreasing prices for 3G handsets and increased competition in the segment have

39

made the service accessible to a greater portion of the population, helping boost the 3G
market from 15 million at end-2011 to 45 million as at 31 December 2013. The market
received a further boost in April 2014 after a decision from the Telecom Dispute Settlement
and Appellate Tribunal (TDSAT) enabled operators to offer services outside of their licensed
areas. The matter had been a bone of contention between regulators and operators since the
3G concessions were first allocated in 2010 (see Wireless Key Legislation for details). At
the end of March 2014 there were 52.4 million 3G subscribers in India, compared to 32.59
million twelve months earlier and18.23 million in March 2012. Despite having seen its share
of the overall wireless market fall in the year to end-March 2014, RCOM led the 3G space
with 12.9 million subscribers at that date. Keen to focus its attention on data services, in
November 2013 RCOM confirmed that it was to restrict its CDMA services to data-only
access. March 2014 then saw it announce plans to roll out an EV-DO Rev B upgrade to all
circles where it was not licensed to operate W-CDMA networks. Bharti Airtel meanwhile laid
claim to second spot in the race for 3G subscribers at 1Q14, with 10.98 million such accesses,
and Idea Cellular was snapping at its heels with 10.2 million users. Vodafone however is
further behind, recording seven million 3G subscribers, although it has seen uptake picking
up the pace, having added 2.5 million net new users in the six months ended 31 March 2014.
Meanwhile the 4G market is in its infancy, with only Bharti Airtel offering LTE-based
services as at end-June 2014, and these being restricted to just a handful of cities. The nascent
segment is set to see the arrival of two new operators in 2H 2014 in the form of Videcon,
which intends to use its 1800MHz spectrum to deploy an FD-LTE network and RJIL which
has pan-India concessions for 2300MHz TD-LTE as well as 1800MHz frequencies that it will
also use for FD-LTE. The main barrier to growth in the 4G market at present is the shortage
of affordable compatible devices. The limited coverage and penetration characteristics of the
2300MHz range and to a lesser extent the 1800MHz band also presents a challenge,
although this obstacle will be easily overcome by the auctioning of frequencies in the
700MHz band or the opening up of the 800MHz range for 4G services.

40

Operational Areas of Wireless Providers

Service Provider

Number of 2G Operating Areaas

2G Operating Areas

Bharti Airtel

22

All India

Vodafone

22

All India

RCOM

20

All India except Assam and NE

Idea Cellular

22

All India

BSNL

20

All India except Delhi and Mumbai

TTSL

19

All India except Assam, North East and J&K

Aircel

22

All India

Uninor/Telewings

Madhya Pradesh, Gujarat, Andhra Pradesh, Uttar Pradesh (W), Uttar Pradesh (E), Bihar

SSTL

Delhi, Kolkata, Gujarat, Karnataka, Tamil Nadu, Kerala, Uttar Pradesh (W), Rajasthan, West Bengal

MTNL

Mumbai, Delhi

Loop

Mumbai

Videocon

Gujarat, Haryana, Uttar Pradesh (W), Uttar Pradesh (E) , Madhya Pradesh, Bihar

Quadrant

Punjab

Sources: TRAI, DoT, operators

41

Networks
Provider Name

Generation Platform

Evolution Frequency Launch

Status

Network
Details

Aircel

2G

GSM

None

900/1800

Apr 1999 Live

Jun-14: 22 of
22 circles

Aircel

2.5G

GSM

EDGE

900/1800

Sep 2004 Live

Jun-14: 22 of
22 circles

Aircel

2.5G

GSM

GPRS

900/1800

Nov 2004 Live

Jun-14: 22 of
22 circles

Aircel

3G

W-CDMA

None

2100

Feb 2011 Live

Jun-14: 13
circles

Aircel

4G

LTE

None

2300

Aug 2014 Live

Aug-14:
Tamil Nadu,
Jammu &
Kashmir

Bharat Sanchar
Nigam Ltd (BSNL)

2G

GSM

None

900

Nov 2001 Live

Jun-14: 20 of
22 circles (all
except
Mumbai and
Delhi)

Bharat Sanchar
Nigam Ltd (BSNL)

2.5G

GSM

GPRS

900

Mar 2004 Live

Jun-14: 20 of
22 circles (all
except Delhi
and Mumbai)

Bharat Sanchar
Nigam Ltd (BSNL)

2.5G

CDMA2000 1x

800

Mar 2005 Live

Jun-14: WiLL
(20 circles)

Bharat Sanchar
Nigam Ltd (BSNL)

2.5G

GSM

EDGE

900

May 2006 Live

Jun-14: 20 of
22 circles (all
except Delhi
and Mumbai)

Bharat Sanchar
Nigam Ltd (BSNL)

3G

W-CDMA

None

2100

Feb 2009 Live

Jun-14: 20 of
22 circles (all
except Delhi
and Mumbai)

Bharat Sanchar
Nigam Ltd (BSNL)

3.5G

W-CDMA

HSDPA

2100

Feb 2009 Live

Jun-14: 20 of
22 circles (all
except Delhi
and Mumbai)

Bharti Airtel

2G

GSM

None

900/1800

Nov 1995 Live

Jun-14: 22 of
22 circles,
86.7%
population

Bharti Airtel

2.5G

GSM

GPRS

900/1800

Jul 2004

Jun-14 22 of
22 circles,
86.7%
population

Live

42

Provider Name

Generation Platform

Evolution Frequency Launch

Status

Network
Details

Bharti Airtel

2.5G

GSM

EDGE

900/1800

Sep 2004 Live

Jun-14: 22 of
22 circles,
86.7%
population

Bharti Airtel

3G

W-CDMA

HSPA+

2100

Jan 2011 Live

Jun-14:
2,580 cities
across all 22
circles
(including
nine circles
covered
through
roaming
pacts)

Bharti Airtel

4G

LTE

None

1800

Bharti Airtel

4G

TD-LTE

None

2300

Apr 2012 Live

Jun-14:
Kolkata,
Bengaluru,
Pune,
Chandigarh,
Mohali,
Panchkula,
Ludhiana and
Jalandhar

Idea Cellular

2G

GSM

None

900/1800

Jan 1997 Live

Jun-14: 22 of
22 circles
(104,778 cell
sites, 7,394
census
towns,
344,108
villages)

Idea Cellular

2.5G

GSM

GPRS

900/1800

Nov 2002 Live

Jun-14: 22 of
22 circles

Idea Cellular

2.5G

GSM

EDGE

900/1800

Jul 2004

Jun-14: 22
circles

Idea Cellular

3G

W-CDMA

HSDPA

2100

Mar 2011 Live

Planned

Live

Nokia
Networks
enlisted for
rollout in
Andhra
Pradesh,
Himachal
Pradesh,
North East,
Punjuab,
Rajasthan
and
Karnataka in
Jan-15

Jun-14:
21,381 sites,
22 circles

43

Provider Name

Generation Platform

Evolution Frequency Launch

Status

Network
Details

Loop Mobile

2G

GSM

None

900

Oct 1995 Live

Jun-14:
Mumbai

Loop Mobile

2.5G

GSM

GPRS

900

Dec 2004 Live

Jun-14:
Mumbai

Loop Mobile

2.5G

GSM

EDGE

900

Q3 2008

Jun-14:
Mumbai

Mahanagar
Telephone Nigam
Ltd (MTNL)

2G

GSM

None

900

Feb 2001 Live

Jun-14: Delhi
and Mumbai

Mahanagar
Telephone Nigam
Ltd (MTNL)

2.5G

GSM

GPRS

900

May 2005 Live

Jun-14: Delhi
and Mumbai

Mahanagar
Telephone Nigam
Ltd (MTNL)

2.5G

CDMA2000 1x

800

Jun 2006 Live

Jun-14: Delhi
and Mumbai
(limited
mobility)

Mahanagar
Telephone Nigam
Ltd (MTNL)

3G

W-CDMA

HSDPA

2100

Feb 2009 Live

Jun-14: Delhi
and Mumbai

Quadrant
Televentures
(formerly HFCL
Infotel)

2G

GSM

None

1800

Mar 2010 Live

Jun-14:
Punjab - in
partnership
with
Videocon

Quadrant
Televentures
(formerly HFCL
Infotel)

2.5G

CDMA2000 1x

800

Q1 2005

Jun-14:
Punjab
(WiLL,
upgradeable
via UASL)

Reliance
Communications
(RCOM)

2G

GSM

900

Sep 1996 Live

Jun-14: 22 of
22 circles

Reliance
Communications
(RCOM)

2.5G

CDMA2000 1x

800

May 2003 Live

Jun-14: 20 of
22 circles (all
regions apart
from Assam
and North
East), 24,000
towns,
600,000
villages

Reliance
Communications
(RCOM)

3G

W-CDMA

2100

Dec 2010 Live

Jun-14: 333
cities in 13
circles
(11,659 base
stations)

Reliance
Communications
(RCOM)

3.5G

CDMA2000 1xEV-DO
Rev A

800

Mar 2009 Live

Jun-14:
1,000 cities

None

HSDPA

Live

Live

44

Provider Name

Generation Platform

Reliance
Communications
(RCOM)

3.5G

W-CDMA

Reliance
Communications
(RCOM)

3.5G

Evolution Frequency Launch

HSPA+

Status

Network
Details

2100

Dec 2010 Live

Jun-14: 13
cities and
towns

CDMA2000 1xEV-DO
Rev B

800

2012

Live

Jun-14: 23
towns and
cities

Reliance Jio
4G
Infocomm Ltd (RJIL)

LTE

None

1800

2014

In
Jun-2014:
Deployment FD-LTE,
spectrum
purchased in
February
2014

Reliance Jio
4G
Infocomm Ltd (RJIL)

TD-LTE

None

2300

Q2 2015

In
Dec-14:
Deployment plans to
launch in
April-June
2015;
Jun-14:
launch
planned for
September
2014

Sistema Shyam
TeleServices
(SSTL, MTS India)

2G

CDMA2000 None

800

Oct 2008 Live

Jun-14:
Delhi,
Gujarat,
Karnataka,
Kerala, Tamil
Nadu,
Kolkata,
West Bengal,
Rajasthan
Uttar
Pradesh
West

Sistema Shyam
TeleServices
(SSTL, MTS India)

2G

GSM

Q4 2011

Jun-14:
previously
restricted to
Rajasthan,
date of
closure
unknown

Sistema Shyam
TeleServices
(SSTL, MTS India)

2.5G

CDMA2000 1x

800

Sep 2003 Live

Jun-14:
Rajasthan
WLL-M

Sistema Shyam
TeleServices
(SSTL, MTS India)

3G

CDMA2000 1xEV-DO

800

Oct 2009 Live

Jun-14: >600
towns in
Delhi,
Gujarat,
Karnataka,
Kerala, Tamil
Nadu,
Kolkata,
Rajasthan,
West Bengal,

None

Live

45

Provider Name

Generation Platform

Evolution Frequency Launch

Status

Network
Details
Uttar
Pradesh
(West)

Sistema Shyam
TeleServices
(SSTL, MTS India)

3.5G

CDMA2000 1xEV-DO
Rev B

800

Sep 2011 Live

Jun-14: (Rev
B Phase II)
Delhi,
Kolkata,
Gujarat,
Karnataka,
Tamil Nadu,
Kerala, Uttar
Pradesh
(West),
Rajasthan,
West Bengal

Tata Teleservices
2G
(TTSL, inc. TTML
and Tata DOCOMO)

CDMA

IS-95A

800

Sep 1998 Live

(WiLL, 6
circles,
upgraded to
mobile
CDMA2000
1x)

Tata Teleservices
2G
(TTSL, inc. TTML
and Tata DOCOMO)

GSM

None

1800

Jun 2009 Live

Jun-14: 19 of
22 circles (all
but Assam,
North East
and Jammu
& Kashmir)

Tata Teleservices
2.5G
(TTSL, inc. TTML
and Tata DOCOMO)

CDMA2000 1x

800

Nov 2002 Live

Jun-14: 22 of
22 circles

Tata Teleservices
3G
(TTSL, inc. TTML
and Tata DOCOMO)

W-CDMA

2100

Nov 2010 Live

Jun-14: 339
towns and
cities across
nine circles

Tata Teleservices
3.5G
(TTSL, inc. TTML
and Tata DOCOMO)

CDMA2000 1xEV-DO
Rev A

800

Mar 2009 Live

Jun-14: 17 of
22 circles,
including
Mumbai,
Punjab,
Rajasthan,
Kerala,
Gujarat and
Delhi

Tata Teleservices
3.5G
(TTSL, inc. TTML
and Tata DOCOMO)

CDMA2000 1xEV-DO
Rev B

800

Oct 2011 Live

Jun-14:
Phase I 22
cities, Phase
II in Delhi,
Kolkata and
Mumbai

Uninor (Telewings)

GSM

1800

Dec 2009 Live

Jun-14: 6
circles (AP,
Bihar,
Gujarat,

2G

HSDPA

None

46

Provider Name

Generation Platform

Evolution Frequency Launch

Status

Network
Details
Maharashtra,
UPE and
UPW), 218
districts,
1,760 cities
and 56,706
villages

Uninor (Telewings)

2G

GSM

GPRS

1800

Apr 2010 Live

Jun-14: 6
circles (AP,
Bihar,
Gujarat,
Maharashtra,
UPE and
UPW), 218
districts,
1,760 cities
and 56,706
villages

Videocon
2G
Telecommunications
Ltd. (formerly
Datacom)

GSM

None

1800

Mar 2010 Live

Jun-14:
Gujarat,
Haryana and
Madhya
Pradesh.
Coverage in
Punjab is
offered
through a
partnership
with
Quadrant
Televentures.

Videocon
4G
Telecommunications
Ltd. (formerly
Datacom)

LTE

None

1800

Q3 2014

Vodafone India
2G
(formerly Hutchison
Essar)

GSM

None

900/1800

Nov 1995 Live

Jun-14: 22 of
22 circles

Vodafone India
2.5G
(formerly Hutchison
Essar)

GSM

GPRS

900/1800

Feb 2004 Live

Jun-14:
unknown

Vodafone India
2.5G
(formerly Hutchison
Essar)

GSM

EDGE

900/1800

Jul 2004

Jun-14:
unknown

Vodafone India
3G
(formerly Hutchison
Essar)

W-CDMA

HSDPA

2100

Mar 2011 Live

Planned

Live

Jun-14:
1,153 towns
across all 22
circles, 750
covered
through
pacts with
Bharti Airtel
and Idea
Cellular

47

3G/4G Licences

Operator
Aircel

Price
Paid

Term

(USD
Type million)

Date
Issued (Years)

Licence

Block (MHz)

Name Paired Unpaired

Frequency Range (MHz)

Paired

W-CDMA

1410

May 2010

20

2x5

1959-1964,
2149-2154
(Uttar
Pradesh [E],
North East);
1964-1969,
2154-2159
(J&K);
1969-1974,
2159-2164
(Karnataka,
Calcutta,
Orissa);
1974-1979,
2164-2169
(Andhra
Pradesh,
Tamil Nadu,
Kerala,
Punjab, West
Bengal,
Biihar,
Assam)

Bharat Sanchar W-CDMA

Nigam Ltd
(BSNL)

2200

Jul 2008

20

2x5

1928-1933,
2118-213
(West
Bengal);
1935-1940,
2125-2130
(Punjab,
Himachal
Pradesh,
Bihar, J&K);
1964-1969,
2154-2159
(14 other
circles of
operation)

Bharti Airtel

2660

May 2010

20

2x5

1959-1964,
2149-2154
(Andhra
Pradesh,
Tamil Nadu,
Uttar Pradesh
[W], West
Bengal,
Himachal
Pradesh);
1964-1969,
2154-2159
(Bihar);
1969-1974,

W-CDMA

Unpaired
(within)

48

Operator

Price
Paid

Term

(USD
Type million)

Date
Issued (Years)

Licence

Block (MHz)

Name Paired Unpaired

Frequency Range (MHz)

Paired

Unpaired
(within)

2159-2164
(Delhi,
Rajasthan,
Assam, North
East);
1974-1979,
2164-2169
(Mumbai,
Karnataka,
Jammu &
Kashmir)
Bharti Airtel

LTE

712.51

Jun 2010

Broadband
Wireless
Access
(BWA)

20

2305-2325
(Maharashtra,
Punjab),
2302.5-2322.5
(Karnataka),
2332.5-2352.5
(Kolkata)

Bharti Airtel

LTE

1,056.3 Jun 2010

Broadband
Wireless
Access
(BWA)

20

2305-2325
(Delhi,
Mumbai),
2325-2345
(Kerala),
2362.5-2382.5
(Haryana)

Idea Cellular

W-CDMA

1250

May 2010

20

2x5

1959-1964,
2149-2154
(Kerala,
Punjab,
Haryana,
Madhya
Pradesh,
J&K);
1969-1974,
2159-2164
(Maharashtra,
Andhra
Pradesh,
Uttar Pradesh
[E], Uttar
Pradesh [W],
Himachal
Pradesh;
1974-1979,
2164-2169
(Gujarat)

Mahanagar
Telephone
Nigam Ltd
(MTNL)

W-CDMA

1420

Jul 2008

20

2x5

1964-1969,
2154-2159
(Delhi and
Mumbai)

Reliance
W-CDMA
Communications
(RCOM)

1860

May 2010

20

2x5

1959-1964,
2149-2154
(Mumbai,

49

Operator

Price
Paid

Term

(USD
Type million)

Date
Issued (Years)

Licence

Block (MHz)

Name Paired Unpaired

Frequency Range (MHz)

Paired

Unpaired
(within)

Rajasthan,
Assam);
1964-1969,
2154-2159
(Punjab,
West
Bengal);
1969-1974,
2159-2164
(Madhya
Pradesh,
Bihar, J&K);
1974-1979,
2164-2169
(Delhi,
Calcutta,
Himachal
Pradesh,
Orissa, North
East)
Reliance Jio
Infocomm Ltd
(RJIL)

LTE

Tata
Teleservices
(TTSL, inc.
TTML and Tata
DOCOMO)

W-CDMA

2,749.4 Jun 2010

1270

May 2010

Broadband
Wireless
Access
(BWA)

20

20

2x5

2305-2325
(Delhi,
Mumbai,
Gujarat,
Kolkata, West
Bengal),
2327.5-2347.5
(Maharashtra),
2347.5-2367.5
(Andhra
Pradesh),
2302.5-2322.5
(Karnataka,
Kerala, Bihar,
North East),
2312.5-2332.5
(Tamil Nadu),
2357.5-2377.5
(Punjab, UPE,
UPW,
Rajasthan),
2322.5-23
1959-1964,
2149-2154
(Maharashtra,
Gujarat,
Karnataka);
1969-1974,
2159-2164
(Kerala,
Punjab,
Haryana);
1974-1979,
2164-2169
(Uttar
Pradesh [W],

50

Operator

Price
Paid

Term

(USD
Type million)

Date
Issued (Years)

Licence

Block (MHz)

Frequency Range (MHz)

Name Paired Unpaired

Paired

Unpaired
(within)

Rajasthan,
Madhya
Pradesh)
Vodafone India
(formerly
Hutchison
Essar)

W-CDMA

2510

May 2010

20

2x5

1959-1964,
2149-2154
(Delhi,
Calcutta);
1969-1974,
2159-2164
(Mumbai,
Gujarat,
Tamil Nadu,
West
Bengal);
1974-1979,
2164-2169
(Maharashtra,
Haryana,
Uttar Pradesh
[E])

Subscribers Market Share by Network

Sources: operators, COAI, AUSPI

Market Share History

Sep
2013

Dec
2013

Mar
2014

Jun
2014

Sep
2014

Dec
2014

Bharti Airtel

22.2%

22.4%

22.7%

22.9%

22.8%

23.0%

Vodafone India (formerly Hutchison Essar)

17.9%

18.1%

18.4%

18.6%

18.7%

18.9%

Idea Cellular

14.6%

14.5%

15.0%

15.2%

15.4%

15.9%

Reliance Communications (RCOM)

13.4%

13.2%

12.3%

11.9%

11.8%

11.3%

Provider Name

51

Sep
2013

Dec
2013

Mar
2014

Jun
2014

Sep
2014

Dec
2014

11.2%

10.9%

10.5%

9.8%

9.3%

8.6%

Aircel

7.3%

7.5%

7.8%

8.0%

8.2%

8.3%

Tata Teleservices (TTSL, inc. TTML and

Tata DOCOMO)

7.3%

7.1%

7.0%

6.9%

6.9%

7.0%

Uninor (Telewings)

3.7%

3.7%

3.9%

4.3%

4.5%

4.6%

Sistema Shyam TeleServices (SSTL, MTS

India)

1.1%

1.1%

1.0%

1.0%

1.0%

1.0%

Videocon Telecommunications Ltd.

(formerly Datacom)

0.4%

0.4%

0.6%

0.6%

0.6%

0.7%

Mahanagar Telephone Nigam Ltd (MTNL)

0.4%

0.4%

0.4%

0.4%

0.4%

0.4%

Quadrant Televentures (formerly HFCL

Infotel)

0.2%

0.2%

0.2%

0.2%

0.3%

0.3%

Loop Mobile

0.3%

0.3%

0.3%

0.3%

0.2%

0.0%

Provider Name
Bharat Sanchar Nigam Ltd (BSNL)

Market Share History

Sources: operators, COAI, AUSPI

52

Quarterly Subscribers by Operator

Provider Name

Subscribers

Sep 2013

Dec 2013

Mar 2014

Jun 2014

Sep 2014

Dec 2014

Aircel

Total

63,245,179

66,911,830

70,151,708

73,071,532

75,850,649

78,673,545

Bharat Sanchar
Nigam Ltd (BSNL)

Total

97,858,181

96,292,218

94,649,445

89,473,372

86,718,098

81,384,517

Bharti Airtel

Total

193,457,000 198,513,000 205,519,000 209,411,000 211,752,000 217,215,000

Idea Cellular

Total

127,228,192 128,685,043 135,800,000 139,000,000 143,600,000 150,500,000

Loop Mobile

Total

2,886,719

2,979,460

2,896,281

2,838,158

1,582,981

Mahanagar
Telephone Nigam
Ltd (MTNL)

Total

3,741,106

3,591,522

3,372,336

3,366,304

3,397,480

3,450,669

Quadrant
Televentures
(formerly HFCL
Infotel)

Total

1,725,835

1,955,811

2,178,306

2,280,966

2,433,975

2,511,405

Reliance
Communications
(RCOM)

Total

Sistema Shyam
TeleServices
(SSTL, MTS India)

Total

9,556,810

9,807,039

9,037,041

9,153,371

9,130,469

8,980,144

Tata Teleservices
Total
(TTSL, inc. TTML
and Tata DOCOMO)

63,546,938

63,267,497

62,999,732

62,869,512

64,248,086

66,166,568

Uninor (Telewings)

Total

32,355,900

32,780,881

35,606,379

39,313,499

41,815,586

43,630,934

Videocon
Total
Telecommunications
Ltd. (formerly
Datacom)

3,244,563

3,969,562

4,987,319

5,550,225

5,941,872

6,452,424

Vodafone India
Total
(formerly Hutchison
Essar)

116,262,001 117,242,552 110,893,161 108,849,746 110,124,024 106,294,446

155,543,181 160,407,965 166,560,986 169,898,000 173,847,000 178,676,000

Aircel

3G

3,100,000

3,285,000

3,485,000

3,600,000

3,750,000

3,900,000

Bharat Sanchar
Nigam Ltd (BSNL)

3G

3,250,000

3,280,000

3,300,000

3,325,000

3,340,000

3,200,000

Bharti Airtel

3G

8,015,000

9,485,000

10,255,000

12,535,000

15,445,000

16,940,000

Idea Cellular

3G

6,200,000

8,700,000

10,200,000

10,600,000

13,300,000

16,100,000

Mahanagar
Telephone Nigam
Ltd (MTNL)

3G

218,000

210,000

205,000

202,000

200,000

202,000

Reliance
Communications
(RCOM)

3G

9,100,000

11,100,000

12,900,000

13,000,000

15,100,000

16,700,000

53

Provider Name

Subscribers

Sep 2013

Dec 2013

Mar 2014

Jun 2014

Sep 2014

Dec 2014

3G

1,110,000

1,142,000

1,180,000

1,225,000

1,250,000

1,280,000

Tata Teleservices
3G
(TTSL, inc. TTML
and Tata DOCOMO)

3,100,000

3,130,000

3,150,000

3,185,000

3,220,000

3,300,000

Vodafone India
3G
(formerly Hutchison
Essar)

4,500,000

5,200,000

7,000,000

10,300,000

13,600,000

16,600,000

8,000

9,500

12,000

15,000

20,000

45,000

Sistema Shyam
TeleServices
(SSTL, MTS India)

Bharti Airtel

4G (LTE)

Sources: operators, COAI, AUSPI

Annual Country Subscriber Growth

Total

Growth
(%)

Pop. Pen.
(%)

3G

2009 520,042,448

52.2

44.3

1,795,000

2010 745,687,609

43.4

62.6

5,395,000

200.6

2011 885,856,716

18.8

73.4 15,055,000

179.1

2012 864,735,294

-2.4

70.7 27,954,000

85.7

4,200

2013 886,404,380

2.5

71.5 45,532,000

62.9

9,500

126.2

2014 943,935,652

6.5

75.2 78,222,000

71.8 45,000

373.7

Year

3G Growth
(%)

4G
(LTE)

4G (LTE)
Growth (%)

Quarterly Country Subscriber Growth

Period

Total

Growth
(%)

3G

3G Growth
(%)

4G
(LTE)

4G (LTE) Growth
(%)

Sep
2012

890,007,168

-3.5 24,144,000

12.5

3,400

36.0

Dec
2012

864,735,294

-2.8 27,954,000

15.8

4,200

23.5

Mar
2013

863,628,191

-0.1 32,586,000

16.6

6,000

42.9

Jun
2013

873,397,944

1.1 34,336,000

5.4

7,000

16.7

Sep
2013

870,651,605

-0.3 38,593,000

12.4

8,000

14.3

Dec
2013

886,404,380

1.8 45,532,000

18.0

9,500

18.8

54

Period

Total

Growth
(%)

3G

3G Growth
(%)

4G
(LTE)

4G (LTE) Growth
(%)

Mar
2014

904,651,694

2.1 51,675,000

13.5

12,000

26.3

Jun
2014

915,075,685

1.2 57,972,000

12.2

15,000

25.0

Sep
2014

930,442,220

1.7 69,205,000

19.4

20,000

33.3

Dec
2014

943,935,652

1.5 78,222,000

13.0

45,000

125.0

Subscriber Growth

Sources: operators, COAI, AUSPI

Main Players
Bharti Airtel
Bharti Crescent
1, Nelson Mandela Road
Vasant Kunj
New Delhi 110 070
India
Tel. +91 11 46666100
Fax +91 11 46666411
http://www.airtel.in
The mobile division of Bharti Airtel includes the merged operations of nationwide GSM
operator Bharti Cellular, and regional licensees Bharti Mobile, Bharti Mobitel, Bharti
Mobinet, Bharti Telenet and Hexacom. The operators were merged by parent group Bharti
Enterprises into Bharti Airtel in March 2006 and now operate under the brand name Airtel,
which is used by all the group's fixed, wireless and internet businesses. The company
possesses concessions covering all of India's circles, all of which are Unified Access Service
Licences (UASLs), except that for the North East region. Bharti Cellular launched the first
Airtel GSM network in Delhi in 1995. Initially a joint venture between Bharti and the UK's
BT Group, the former took whole ownership of Bharti Cellular by snapping up all BT's

55

shares in 2001. The group meanwhile entered the market in Himachal Pradesh via subsidiary
Bharti Telenet in 1996. Another subsidiary, Bharti Mobile, was incorporated in 1999 after
Bharti bought and subsequently rebranded JT Mobile, a cellco operating in the Karnataka and
Andhra Pradesh circles, and the next year the group acquired Skycell Communications, based
in Chennai (now part of the Tamil Nadu circle), renaming it Bharti Mobinet. Calcutta-based
Bharti Mobitel was originally known as Spice Cell until Bharti bought it in 2001, while the
company completed its acquisitions with the addition of Rajasthan circle operator Hexacom,
in which it acquired a 67.5% equity stake from the local Shyam group in May 2004, gaining
an all-India licence footprint in the process.
Whilst aggressively pursuing acquisitions, Airtel also grew organically by investing heavily
in its own infrastructure. Between 2004 and 2010 it spent around USD4 billion on
infrastructure deals, forging long-term partnerships with Ericsson of Sweden and Finlands
Nokia. For the most part, Nokia handled expansion, improvement and maintenance of
infrastructure in the Mumbai, Calcutta, Maharashtra, Gujarat, Bihar, Orissa, West Bengal
and Madhya Pradesh circles, whilst Ericsson managed the remaining service areas. Through
this arrangement, Airtel achieved nationwide GSM coverage in April 2005. In 2010, both
vendors were contracted to make the networks in their respective areas 3G-ready, upgrading
base stations as well as core and transport networks. The majority of Airtels infrastructure
is GPRS-enabled and it deployed its first EDGE services in July 2004, rolling out the
technology in Punjab before expanding to the cities of Delhi, Mumbai, Kolkata and Chennai.
As at end-March 2014, 86.7% of the Indian population was within Bhartis 2G footprint,
unchanged year-on-year , and its network consists of 138,775 towers, covering 5,121 census
towns and 460,783 non-census towns and villages.
Beyond EDGE, the logical technological development for Airtel was 3G W-CDMA, and
in April 2005 it outlined plans to invest USD1 billion to roll out national W-CDMA
infrastructure, and it was one of seven GSM operators given permission to test the service
in early 2007. Bharti subsequently paid INR122.95 billion (USD2.66 billion) for 3G licences
in 13 circles in May 2010, the highest amount paid by any of the seven 3G auction
winners (see Wireless Key Legislation for details). With none of the participating cellcos
acquiring pan-India spectrum, Bharti, Idea Cellular and Vodafone India signed inter-circle
roaming agreements, whereby each could offer 3G services outside of their licensed areas
by piggybacking on each others infrastructure. In December 2011, however, the government
reversed its earlier decision on inter-circle roaming and banned the practice. After more
than a year of legal battles between the operators and the Department of Telecommunication
(DoT), in April 2013 the Supreme Court ruled in favour of the watchdog, agreeing that 3G
roaming deals were indeed illegal. In order to minimise disruption, the apex court allowed
cellcos to continue serving existing users outside of their licensed areas, although no new
users could be signed up. In a further turn, the Telecom Disputes Settlement and Appellate
Tribunal (TDSAT) overturned the decision in April 2014, clearing Airtel to sign up 3G
customers outside of its licensed areas once more.
In January 2011 Airtel inaugurated its W-CDMA network in Karnataka, its largest circle
by revenue market share. At that date it was also confirmed that the cellco had inked
agreements with three vendors long standing partners Ericsson and Nokia, as well as
Huawei Technologies for the construction of infrastructure supporting 3G services, with
the trio contracted to plan, design, deploy and maintain HSPA+ networks for it. The cellcos
3G infrastructure enables theoretical maximum download speeds of up to 21Mbps, and at
end-June 2014 its 3G services were offered in 2,580 towns and cities across all 22 circles. Of
Bhartis 138,775 towers, 31,301 were 3G-enabled at that date.
Forging ahead, Airtel became the first cellco in India to offer 4G services, launching a Time
Division Long Term Evolution (TD-LTE) network in Kolkata in April 2012. The platform
uses the 2300MHz spectrum in the Maharashtra, Karnataka, Kolkata and Punjab circles
purchased by Bharti in 2010. Its spectrum holdings were boosted in May 2012 by Bhartis
acquisition of a 49% stake in Qualcomm India for INR9.07 billion, giving it access to further

56

spectrum in Delhi, Mumbai, Kerala and Haryana. Breaking from its usual pattern, however,
the cellco enlisted not only Nokia and Ericsson for the rollout, but also ZTE and Huawei, with
each vendor managing a separate circle; Maharashtra and Punjab, Kolkata and Karnataka,
respectively. In February 2013, Bharti tasked NSN with deploying Circuit Switched FallBack
(CSFB) in Pune, with the technology set to allow 4G users to transfer to Airtels 2G
network to make and receive calls and send messages, once compatible handsets were made
available. Having previously been limited to USB modems only, Airtel launched 4G on
mobile handsets in February 2014, before extending the function throughout its footprint. At
the time of writing (June 2014), 4G services were available in Kolkata, Bengaluru, Pune,
Chandigarh, Mohali, Panchkula, Ludhiana and Jalandhar. Despite having announced plans
to launch Voice-over-LTE (VoLTE) in early 2013, Airtel is yet to progress beyond trials of
the technology, with compatible handsets understood to be a major stumbling block for the
service.
In December 2007 Airtel, Vodafone India and Idea finalised an infrastructure sharing
agreement to transfer around 70,000 mobile mast sites into a joint venture company, Indus
Towers, to save rollout costs. Bharti's wholly owned infrastructure subsidiary Bharti Infratel
and Vodafone each have a 42% stake in Indus Towers, while Idea holds 16%. Later that
month Bharti Infratel, which directly owns around 20,000 cellular sites, was promised
USD1 billion in investment from international corporations Temasek Holdings (parent of
Bharti shareholder SingTel), The Investment Corporation of Dubai (ICD), Goldman Sachs,
Macquarie, AIF Capital, Citigroup and India Equity Partners (IEP). Having transferred a
significant number of its towers (35,254) across to Indus, at end-March 2014 Infratel had
35,905 towers, up from 35,119 a year earlier. At that same date the Indus Towers portfolio
totalled 113,008 towers.
Whilst Airtel led the market at end-March 2014 with 205.52 million subscribers, equivalent
to a 22.7% market share, the cellco may face greater competition from its smaller rivals over
the next three years as it comes under greater financial pressure from spectrum purchases.
Airtels licences for operations in eight circles Delhi and Kolkata (both 2014), Andhra
Pradesh, Himachal Pradesh, North East, Punjab (all 2015), Karnataka and Rajasthan (both
2016) are due to expire between in the coming years and the provider will be forced
to repurchase its concessions in those areas via auction, or face having to halt services.
Meanwhile, Airtel spent INR185.3 billion to renew concessions in 18 circles, including
the three metro areas in February 2014. The financial burden of the spectrum purchases
may leave the operator vulnerable to price competition from its competitors, with Reliance
Communications (RCOM) in particular saying that it plans to cut prices in the busiest circles
in a bid to steal market share from Airtel, as well as Vodafone and Idea, which are facing
similar payouts for frequencies.
Nevertheless, Airtel made the first move in recent years towards consolidating the market,
announcing in early 2014 that it had signed a deal to take over Loop Mobile, with the
smaller cellco facing closure after the revocation of sister company Loop Telecoms 21
operating licences in February 2012 left the provider with a hefty debt burden, precluding
its participation in the upcoming spectrum auction, in which it would need to repurchase its
Mumbai concession to continue offering services. The deal stalled in May 2014, however,
when Chinese vendor ZTE moved the high court against the deal, looking to restrain the
transaction until the cellco paid USD25 million owed to the vendor. A spokesperson for ZTE
explained: It has come to our notice that Loop is entering into a deal to transfer its operating
assets to Bharti Airtel, without keeping us informed about this. To secure our interests, we
have moved an additional application to the high court for the recovery of the dues. Loop
Mobile and its now-defunct subsidiary Loop Telecom had both entered into agreements with
ZTE prior to the revocation of the latters concessions in early 2012.
As at end-December 2013 Bharti Airtel was owned by Bharti Telecom Ltd (43.57%), Pastel
Ltd (14.79%) and Indian Continent Investment Ltd (6.65%). Other shareholders include Life
Insurance of India (4.77%), Three Pillars Ltd (5.00%) and ICICI Prudential Life Insurance

57

Company (1.16%). Bharti Telecom is in turn owned by Bharti Enterprises, Pastel and
Vodafone Group, while Indian Continent Investment is a wholly-owned subsidiary of Bharti
Enterprises. Pastel meanwhile is a wholly-owned subsidiary of Singapore Telecom (SingTel);
SingTel has an indirect equity interest in Bharti Airtel of 32.34% as of end-2013.
In May 2013 Airtel agreed to issue 199.87 million new shares to the Qatar Foundation
Endowment (QFE), representing a 5% shareholding in the company, for a total consideration
of USD1.27 billion. Under the terms of the deal, QFE subscribed to 199,870,006 new shares
in Bharti Airtel at a price of INR340 (USD6.35) per share (these are currently held via Three
Pillars Ltd).
Airtel is listed on the National Stock Exchange of India (NSE) and the Bombay Stock
Exchange (BSE).

Vodafone India (formerly Hutchison Essar)

Peninsula Corporate Park
Ganpatrao Kadam Marg, Lower Parel
Mumbai 400013
India
Tel. +91 22 56645000
Fax +91 22 56661200
http://www.vodafone.in
Vodafone India (formerly known as Vodafone Essar, and historically Hutchison Essar) is a
consolidated subsidiary of UK-based Vodafone Group, and commenced operations in 1995
after previous owner Hutchison Telecom International Ltd (HTIL) acquired a cellular licence
for Mumbai. Vodafone Group completed the USD11 billion acquisition of Hutchison Essar
in May 2007 and the company was formally renamed Vodafone Essar in July 2007. The
Vodafone moniker had its official Indian launch on 21 September 2007, following a giant
rebranding exercise involving 400,000 retail outlets. The company altered its name again
from Vodafone Essar to Vodafone India after the UK group was able to exercise options to
acquire additional shares from local firm Essar Group in July 2011.
Vodafone Essar was granted domestic and international long-distance (DLD and ILD)
telephony licences in late 2006, and some three years later, in June 2009 it applied for a
national long-distance (NLD) concession, as well as a nationwide internet service provider
(ISP) licence. In July 2009 the regulator announced it had cleared the submissions, with
Vodafone noting that it hoped the NLD licence would enable it to reduce operating costs for
carrying subscriber trunk dialling (STD) traffic as it would no longer rely on renting capacity
on other operators networks.
In January 2008 the Department of Telecommunications (DoT) cleared Vodafone's
application to be granted near-nationwide GSM spectrum in all but one of the country's 22
telecoms circles. The cellco subsequently confirmed that the regulator had issued it with
4.4MHz of start-up spectrum in each of the six circles where it had Unified Access Service
Licences (UASLs) but had yet to launch. On the back of that development, Vodafone Group
pledged to invest USD2 billion annually for the next three years in expansion of the Indian
operation, but cautioned that further 2G spectrum would be needed to satisfy the cellcos
growth ambitions. The operators pan-India presence was completed with a rollout in the
Jammu & Kashmir (J&K) circle in March 2009.
More recently, Vodafones attention has turned to 3G services. With the governments muchdelayed sale of third-generation spectrum finally moving forward in the first half of 2010, in
March at Vodafones application to take part in the sale process was accepted. Subsequently,
with the auction closing in May 2010 it was confirmed that Vodafone had successfully bid

58

for 3G spectrum in nine circles for a total of INR116.18 billion (USD2.51 billion); the nine
circles reportedly covered around 60% of Vodafones subscriber base at that date. After
several delays, the cellco launched the new service in Delhi and Chennai at the start of
March, before inaugurating its 3G network in Uttar Pradesh (East) later that month. In the
two years to end-March 2014 Vodafone rolled out 10,500 3G and 9,7002G base stations,
supported by more than 13,000km of fibre. As at end-June 2014 Vodafones 3G services were
available in more than 1,100 towns and cities in all 22 circles, although of these 750 cities
across 13 were offered via roaming deals with Bharti Airtel and Idea Cellular.
Supplementing its own network, the cellco also offered 3G services outside of its licensed
areas via controversial inter-circle roaming deals with other 3G operators. A stop was put
to this practice in April 2013, however, with the Supreme Court instructing cellcos to cease
signing up new users over inter-circle roaming, though existing subscribers were unaffected
by the order (see Wireless Key Legislation for details). In response, Vodafone announced
plans the following month to extend its 3G coverage nationwide, and said it was looking to
purchase spectrum from other cellcos in areas where it did not already hold a licence. The
frequencies of defunct provider STel may represent a potential acquisition target as its three
licences for Bihar, Himachal Pradesh and Orissa do not overlap with Vodafones existing
concessions. Whilst further frequency purchases or mergers have not been ruled out by
the UK-backed cellco in October 2013 Vodafone Indias CEO commented that the cellco
would be keen to play a role in consolidation in the market a Telecom Disputes Settlement
and Appellate Tribunal (TDSAT) decision in April 2014 overturned the previous ruling on
inter-circle roaming, thereby allowing Vodafone to offer 3G outside of its licenced area once
more.
Vodafone has also invested heavily in ramping up its range of services, including multimedia
applications based on its GPRS and EDGE data platforms, launched in 2004. These included
push-to-talk (PTT), which it was later forced to stop selling, after the Telecom Regulatory
Authority of India (TRAI) ruled that its operating licence did not cover such services. In
October 2006 it launched BlackBerry corporate mobile services, and it has continued to
introduce a range of upgraded BlackBerry models and applications to further reinforce its
position in the corporate segment. March 2010 meanwhile saw the cellco announce that
it would be adding the much-requested iPhone 3GS to its range of available handsets.
Other business user services include Vodafone Office, which allows calls from fixed office
handsets to be routed through the GSM network instead of the PSTN. In line with growing
global trends, the operator also launched its own app store for those subscribers using
smartphones in March 2010. More recently, in April 2013 Vodafone launched mobile money
service M-Pesa. Mobile financial services were made available on a nationwide basis by the
end of April 2014, following a launch in Andhra Pradesh that month.
In December 2007 Vodafone Essar, Bharti Airtel and Idea Cellular finalised an infrastructure
sharing agreement to transfer approximately 70,000 mobile mast sites into a joint venture
company, Indus Towers. Vodafone and Bharti each have a 42% stake in the joint venture,
with Idea taking the remaining 16%, and the three collaborators estimating that another
50,000 towers would be built over the next two to three years. Subsequently, in March
2009 it was reported that Vodafone Essar was set to fully spin off its mobile towers and
infrastructure business in to a new company, Ortus Infratel Holdings, with the new entity to
hold Vodafone Essar's 42% stake in Indus, while also taking responsibility for approximately
6,000 towers that were not owned by the joint venture. The proposals were finally approved
in June 2009 by the Foreign Investment Promotion Board (FIPB) after two deferrals on the
back of concerns raised by the Department of International Taxation.
In mid-June 2014 Vodafone briefly blocked calls from debt-laden Mumbai-based operator
Loop Mobile over unpaid interconnection fees. Vodafone claimed that the fees were long
overdue, but stopped short of specifying the amount owed by its rival. The block lasted
just one day, with Vodafone announcing that it had reached an agreement for payment

59

settlement with Loop, whose business had been crippled by the February 2012 licence
cancellation which revoked 21 concessions held by its sister company Loop Telecom.
Vodafone took part in the February 2014 spectrum auction, winning rights for frequencies
in the 1800MHz in eleven circles, and 900MHz band airwaves in the metro areas, Mumbai,
Delhi and Kolkata. Vodafone paid INR196 billion for the frequencies. Following the auction,
it was reported that it would look to sell off an indirect 4.4% stake the cellco held in
competitor Bharti Airtel, amidst concerns that the holding might delay its licence allocation.
Under new licensing rules operators or stakeholders may not hold beneficial interest in
multiple licensees within a single operating area previously, competitors and promoters
could hold up to a 10% in another provider offering services within the same circle.
Vodafone was subsequently denied the opportunity to renew concessions for Kerala, Tamil
Nadu, Haryana, Rajasthan, Uttar Pradesh East, Maharashtra and Gujarat in June 2014.
Under the terms of the concessions, which were originally awarded in 1995, operators were
permitted to extend their authorisations for a further ten years after the initial 20-year licence
period. In rejecting the request, the DoT noted that the sector had changed too much since the
licences were first allocated to permit the extension. Instead, the DoT has told Vodafone that
it will need to convert the authorisations to unified licences and re-purchase the frequencies
at a competitive auction to be held later that year.
Vodafone Group has encountered notable legal troubles related to tax issues stemming from
its original stake acquisition in Vodafone India. The Indian government claims it is owed
USD2 billion from Vodafone in unpaid tax in relation to the UK companys USD11 billion
purchase of Hutchison Whampoas stake in the cellco in 2007. Vodafone has disputed the
claim on the basis that Indian law at the time did not require it to withhold tax on the
acquisition as the transaction was carried out by two foreign companies, and that capital
gains tax was usually paid by the seller, not the buyer. After the case made its way through
Indias byzantine judicial system to the Supreme Court in January 2012, the apex body
ruled in favour of the UK group. However, in May that year the government introduced new
legislation the Finance Bill 2012 that would allow it to tax the company retrospectively.
Negotiations continued for another two years, but Vodafone finally lost patience in May 2014
and filed for international arbitration.
In early December 2013 Vodafone Group CEO Vittorio Colao announced plans for the group
to invest USD3 billion in its operations in India in 2014 and 2015, with spending to be
focussed on the expansion of its networks in rural areas. The proposed investment equates to
around 15% of the group's global investment over the period, and excludes any expenditure
for buying spectrum in India. Colao also confirmed that Vodafone would look at listing its
Indian unit once it has been granted permission to raise its stake to 100% (subsequently
carried out in April 2014), the ongoing USD2 billion tax dispute is settled, and there is more
clarity on charges for the use of wireless spectrum.
Vodafone India is wholly-owned by UK-based Vodafone Group.
Vodafone Group took majority control of the telco from Hutchison Telecom International Ltd
(HTIL) in May 2007, paying GBP5.5 billion (USD11 billion), excluding GBP1.2 billion of
assumed net debt and GBP2.4 billion representing call options, to increase its equity interest
in the Indian cellco from 52% to 67%. Indian multinational conglomerate Essar Group exited
the company in July 2011, offloading its 33% stake.
Following changes to rules regarding foreign direct investment (FDI) in the telecoms sector,
which lifted the maximum holding a foreign company could own in a telco from 74% to
100%, Vodafone announced in October 2013 that it would move to take full control of its
Indian unit. The UK group completed the takeover in early 2014, purchasing the 24.65%
holding of local businessman Analjit Singh for INR12.41 billion (USD205.81 million) in

60

March, before buying the 10.97% stake held by Piramal Enterprises for INR89 billion the
following month.

Reliance Communications (RCOM)

H Block, 1st Floor
Dhirubhai Ambani Knowledge City
Navi Mumbai 400 0710
India
Tel. +91 22 30386010
Fax +91 22 30376622
http://www.rcom.co.in
Reliance Communications Ltd (RCOM) is the holding company for the telecoms assets of
India's powerful Reliance Anil Dhirubhai Ambani Group. It owns all of the group's telecoms
networks, facilities, licences and properties, including a nationwide wireless network
providing both cellular and wireless in the local loop (WiLL) services over CDMA and
GSM platforms. Originally part of Reliance Industries, RCOM was demerged from the group
in 2005 in the wake of a dispute between Mukesh and Anil Ambani, the sons of Reliance
founder Dhirubhai Ambani, following the latters death in 2002. Under the terms of the
deal, Anil took control of the groups telecommunications, electricity and financial services,
which were spun off to create Reliance Anil Dhirubhai Ambani Group. The remaining
petrochemical and manufacturing assets were renamed Reliance Industries Ltd (RIL), under
Mukesh. RCOM directly owns all CDMA assets and some of its GSM infrastructure, whilst
its wholly owned subsidiary Reliance Telecom Ltd (RTL) owns the cellcos GSM business
in eight circles (the other 14 being held by RCOM directly). RCOM is licensed to provide
wireless services in all 22 of Indias telecoms circles. It offers CDMA2000 1x networks in
20 circles; it has a presence in all except Assam and North-East, although it has received
the government approval and requisite spectrum to launch CDMA-based services in these
regions.
After a rollout in partnership with Alcatel-Lucent, CDMA2000 1x 800MHz services were
rolled out to 92 cities in May 2003, with the cellco signing up a million customers in its first
month alone by undercutting the prices of its GSM-based rivals. However, the service did not
offer true national mobile functionality until November that year, when RCOM introduced
national CDMA roaming across its whole footprint. After achieving rapid CDMA subscriber
growth in its initial years of operation, the company began to look beyond the main urban
centres and major highways to meet previously untapped demand in the outlying rural areas.
Expansion briefly stalled in 2005/2006 as a result of the dismantling of Reliance Industries,
but was quickly restarted.
In early 2006 RCOM applied for permission to roll out GSM networks in 14 new circles;
at that date subsidiary Reliance Telecom already operated GSM-based services in eight
circles, those being Madhya Pradesh, West Bengal, Himachal Pradesh, Orissa, Bihar, Assam,
Calcutta and North East. RCOM was granted the additional concessions in January 2008
at the same time as the controversial 2G licence auction under the Unified Access Service
Licence (UASL) regime. RCOM responded to the development by announcing it would look
to place a giant order for between 80 million and 100 million GSM lines, with rollout to be
spread over three years. It said it would invest more than USD5.1 billion during 2008 alone
to expand its GSM coverage, and signed a major supply deal with Chinese vendor Huawei
worth USD500 million in January of that year. In July 2008 the operator's GSM aspirations
took a step forward with the Telecoms Regulatory Authority of India (TRAI) ruling that all
operators must offer interconnectivity to RCOM's new GSM network. RCOM staggered the
launch of services, beginning in September 2008 with a soft launch in major cities and circles
including Mumbai, Delhi, Gujarat and Punjab. The following February it announced that it

61

had completed its nationwide GSM rollout, noting that more than one billion Indians were
within its coverage areas.
RCOM launched 3.5G services in March 2009 with the activation of its CDMA2000 1xEVDO Rev A platform and by end-March 2014 the cellcos Rev A network had been rolled
out to 1,000 towns and cities, including 39 Category A towns. The cellco trialled the Rev
B upgrade in Halol (Gujarat state) in July 2012 and has since commercially launched the
platform in 23 towns and cities, including four of the seven metro areas (in addition to
the three cities classified as metro circles by the regulator, RCOM designates that status to
Bangalore, Pune, Chennai and Hyderabad) and 19 Category A towns. In November 2013,
RCOM announced that it was to restructure its operations, restricting its CDMA services
to access on a data-only basis. Going forward, in March 2014 the cellcos CEO confirmed
that RCOM was planning to upgrade its EV-DO network to Rev-B in its nine non-3G
(i.e. non W-CDMA) circles alongside other recent CDMA initiatives including the launch
of dual GSM/CDMA smartphones and the introduction of a dedicated CDMA team within
its mobility business. The CEO also explained that RCOM was renewing the focus on its
CDMA business now that CDMA voice revenue was close to stabilising and the Indian
CDMA handset ecosystem had begun improving. According to the official, RCOM sees an
opportunity to offer higher speed data services through its existing 800MHz CDMA network,
courtesy of the weakening spectrum position of its CDMA competitors; Tata Teleservices
surrendered excess CDMA spectrum in December 2013 and Sistema Shyam TeleServices
(SSTL) only holds 800MHz spectrum in eight circles compared to RCOMs pan-India
footprint.
RCOM was one of seven operators issued a small allocation of 3G spectrum with which to
trial W-CDMA services in early 2007 and went on to win frequencies in the long-delayed
auction, which closed in May 2010. RCOM paid INR85.85 billion (USD1.68 billion) to
acquire 25MHz paired spectrum in 13 circles, those being: Delhi, Mumbai, Kolkata, Punjab,
Rajasthan, Madhya Pradesh, West Bengal, Himachal Pradesh, Bihar, Orissa, Assam, North
East and Jammu & Kashmir. The operator was finally allocated its new frequencies in
September 2010. RCOM became the second private player to launch commercial 3G services
in December 2010, inaugurating its W-CDMA networks in four cities Mumbai, Delhi,
Kolkata and Chandigarh. By June 2014, RCOM offered 3G services in all 13 circles for
which it possessed licences. Its 3G network consisted of 11,659 sites and covered 333 towns
and cities, and it had signed up a total of 12.9 million 3G users by March 2014, up from 7.2
million twelve months earlier. By that date the cellco had also rolled out an HSPA+ upgrade
to its base stations in three metro circles and ten Category A towns and cities.
RCOM has repeatedly attempted to hive-off its assets to reduce debt, but has been hindered
by the global economic crisis and, more recently, regulatory uncertainty. The cellco unveiled
plans for an initial public offering (IPO) of its tower infrastructure subsidiary, Reliance
Infratel, in February 2008, although the global economic slowdown that year prompted
RCOM to shelve its plans. Plans for a second attempt at an IPO the following year were
similarly scrapped. Finally, in June 2010 Infratel unveiled tangible proposals to spin off its
50,000 telecoms towers to GTL Infrastructure; under the terms of the deal, GTL would give
Reliance equity and cash, as well as reducing the latters consolidated net debt from INR330
billion to INR150 billion, while each Reliance shareholder would receive two to three shares
in GTL. Just three months later though, in September 2010 RCOM halted negotiations with
GTL after neither side could agree on a deal; no specific reason for the collapse of the deal
was given, with RCOM saying that it could not discuss the matter due to confidentiality
agreements. Over the following two years, the cellco reported interest from various parties,
though no deal was forthcoming, and most recently in May 2012 RCOM confirmed that plans
to sell off the towerco had been held up by regulatory uncertainty sparked by the Supreme
Courts cancellation of 122 licences in February that year.
Looking to trim its operating expenses, RCOM signed network management deals with
Alcatel-Lucent and Ericsson in early 2013, each of which was valued at around USD1 billion.

62

Under the Alca-Lu deal the French-US vendor agreed to install its next generation operation
support systems (OSS) and network optimisation tools to improve the performance of the
telcos wireless, wireline and fibre networks in the southern and eastern states. In addition,
Alca-Lu said it would assist in combining RCOMs fixed and wireless arms under a single
management structure, while also taking responsibility for improving network performance
and service quality, with the goal of increasing customer satisfaction up to 2020. The
following month, the cellco inked an eight-year contract with Swedish vendor Ericsson to
manage its networks in the northern and western states of India. Under the terms of the
agreement, Ericsson will be responsible for network performance and service quality and will
work closely with RCOM to identify opportunities to introduce new services. The area to
be covered by Ericsson includes 100,000km of fibre-optic cable and mobile infrastructure in
eleven circles, including the metro areas of Delhi and Mumbai.
Following the network management deals, RCOM has struck a number of infrastructure
sharing deals with Reliance Jio Infocomm Ltd (RJIL), the 4G startup of Mukesh Ambanis
RIL, and struggling rivals Aircel and Tata Teleservices (TTSL). The first pact , agreed
in early April 2013, was valued at INR12 billion and granted RJIL access to RCOMs
120,000km inter-city fibre network, with the latter similarly gaining access to fibre installed
by RJIL. A second contract between the two Ambani-backed companies followed in early
June, with the INR120 billion, 15-year deal granting Jio access to some 45,000 RCOM
towers, while in return RCOM gained the right to use of any RJIL-installed towers. This was
followed in April 2014 with the signing of a third reciprocal deal, through which RJIL would
utilise RCOMs intra-city fibre network, which at that date spanned more than 500,000km
and covered more than 300 cities. Subsequently, rumours emerged in mid-June 2014 that
the two companies were planning a new agreement, under which RJIL will utilise RCOMs
800MHz and 2100MHz spectrum. The former band in particular is of interest to Jio, as it
would improve the indoor coverage of its LTE networks. Meanwhile, in late April 2013,
RCOM signed a bilateral tower sharing deal with Aircel that will add 10,000 towers to the
formers footprint. The deal is expected to be the first of several, aimed at cutting expansion
costs: the cellco has estimated that the Aircel agreement will reduce its CAPEX by INR12
billion. This was followed in July that year by a tower sharing agreement with TTSL, under
which RCOM will utilise 5,000 of Tata-owned towers across 14 circles, whilst Tata will gain
access to the same number of CDMA towers.
A string of subscriber base cleanses in 2012 and 2013 saw RCOM shed more than 40
million customers from its user base. The first clean-up of inactive users was implemented
in July 2012 and caused RCOMs subscriber base to fall from 154.6 million as at 30 June
2012 to 134.8 million three months later, with its market share dipping from 16.8% to
15.2%. The following quarter RCOM registered approximately 16 million net disconnections,
reducing its total user base to 118.5 million, representing a market share of 13.7%. RCOM
continued to clean up its subscriber base the following year, revealing in September that it
had disconnected some ten million low-end subscribers that had not used their phones for
more than two months. As a result of the disconnections, RCOM has fallen from second place
in the market to fourth, having been overtaken by Vodafone in 2012 and Idea Cellular in
mid-2013. RCOM remains optimistic about its position in the market, however, pointing out
that its three largest rivals will be forced to repurchase at auction their frequency rights for
key operating areas over the next two years, as their existing concessions expire. The cellco
claims that it will be less affected by this than its competitors, given that the areas in which
its licences are due to run out contribute a comparatively small portion gross annual revenues
(around 15%, compared to the 46%, 71% and 73% faced by Airtel, Vodafone and Idea,
respectively). With the trio expected to face total spectrum costs of roughly USD3 billionUSD5.5 million, RCOM intends to increase pricing pressure on its competitors in seven of
the busiest circles.
Reliance Communications Ltd is 67.86%-owned by India's Reliance Anil Dhirubhai Ambani
Group. The remainder is distributed, including 7.25% held by the Life Insurance Corporation
of India as of end-March 2013.

63

Idea Cellular
Windsor', 5th Floor, off CST Road
near Vidya Nagari, Kalina
Santacruz (East)
Mumbai 400098
India
Tel. +91 79 66714000
Fax +91 79 23232251
http://www.ideacellular.com
Idea Cellular was established as Birla Tata AT&T Communications after its three original
major investors, Aditya Birla Group, Tata Group and AT&T Wireless before being renamed
to Idea in May 2002. The cellco launched services in Gujarat (January 1997), Maharashtra
(March 1998) and Delhi (November 2002), whilst expanding through a series of acquisitions.
Mergers and takeovers saw the operator expand to Andhra Pradesh (Tata Cellular, 2000)
and Madhya Pradesh (RPG Cellcom, 2001), before the purchase of Escotel Mobile
Communications for INR3.5 billion (USD79 million) in January added Haryana, Kerala and
Uttar Pradesh (West) as well as licences for Uttar Pradesh (East), Rajasthan, and Himachal
Pradesh; Idea launched in the three new circles in between September and November 2006.
Idea added licences for Bihar and Mumbai as well as additional spectrum in Rajasthan and
Uttar Pradesh (East) in January 2008. Commercial launches in Mumbai and Bihar followed
in August and October 2008, respectively. Also in 2008, Idea won at auction licences for nine
circles, although these were overturned by the Supreme Court in February 2012 (see Wireless
Key Legislation for details). Seven of these licences Assam, Jammu & Kashmir (J&K),
North East, Orissa, Kolkata, Tamil Nadu and West Bengal were subsequently repurchased
in the November 2012 spectrum auction.
Meanwhile, June 2008 had also seen Idea acquire a 40.8% stake in Spice Communications
and the regulator briefly raised concerns over the pact, as no operator could hold more than
a 10% stake in another provider in the same circle and the two firms licences overlapped in
six areas Andhra Pradesh, Delhi, Haryana, Maharashtra, Punjab and Karnataka. The issue
of a merger between the two cellcos became a bone of contention between the Department
of Telecommunications (DoT) and Idea/Spice and the matter became bogged down in the
courts throughout 2010 and 2011 as the regulator accused Idea of failing to follow licence
and merger guidelines. Seemingly drawing a line under the matter, in July 2011 the Delhi
High Court ruled that Spices six licences would not be transferred to Idea and would
instead be placed under the control of the DoT. The DoT was instructed to ensure that
that service continued uninterrupted in the two circles where Spice had already launched
Punjab and Karnataka. Looking to have its cake and eat it, the DoT later attempted to issue
fines against Idea for failing to meet rollout requirements in the six regions but the cellco
successfully challenged this ruling with the Telecom Disputes Settlement and Appellate
Tribunal (TDSAT). Simplifying the matter somewhat, the Supreme Courts order in February
2012 (see Wireless Key Legislation for details) cancelled Ideas concessions in Punjab and
Karnataka as well as Spices licences for Andhra Pradesh, Delhi, Haryana and Maharashtra,
leaving only the former Spice Punjab and Karnataka licences operational. Late-2013 saw
the DoT issue Idea with an INR6 billion penalty for the cellcos alleged licence violations
related to the Spice merger as of June 2014 an appeal against the fine was under review
from TDSAT. Finally, in February 2014, the Supreme Court ordered the DoT to return the
Karnataka and Punjab licences to Idea Cellular.
As at end-June 2014, Idea Cellulars 2G operations covered all 22 regions. The cellco divides
its operations into Leadership, Emerging and Growth geographies, the first two of which
it also describes as its Established circles, whilst the latter group is also known as its
New operating areas. Leadership areas are the eight circles Kerala, Madhya Pradesh, Uttar
Pradesh (West), Maharashtra, Haryana, Punjab, Andhra Pradesh and Gujarat in which Idea

64

claims to rank first or second in terms of revenue market share; these circles represent around
68% of Ideas total turnover. Idea has 2G and 3G spectrum for all eight areas and Long Term
Evolution (LTE)-suitable frequencies for six. A further seven areas Uttar Pradesh (East),
Rajasthan, Delhi, Bihar, Karnataka, Himachal Pradesh and Mumbai represent the Emerging
regions where Idea sees the greatest potential for growth. The final seven areas represent the
regions where Idea is yet to achieve a strong presence.
Idea won licences to offer 3G services in eleven circles in May 2010, paying INR57.69
billion for concessions in Maharashtra, Gujarat, Andhra Pradesh, Kerala, Punjab, Haryana,
Uttar Pradesh (East), Uttar Pradesh (West), Madhya Pradesh, Himachal Pradesh and J&K.
The cellco went on to win 900MHz spectrum rights for Delhi in February 2014, revealing
plans to launch 3G services in that region in 2015. Early 2014 saw a further coup for Ideas
3G offerings, with the announcement in May 2014 that it was able to provide 3G services on
a pan-India basis. The news followed a TDSAT ruling in April that year which overturned
a controversial decision to ban intra-circle roaming pacts (see Wireless Key Legislation for
details). Under a previous ruling, Idea had been banned from signing up new subscribers
outside of its licensed area. The TDSAT decision allowed Idea to resume providing 3G
services through agreements with other operators in ten circles, namely Delhi, Mumbai,
Rajasthan, Karnataka, Kolkata, West Bengal, Tamil Nadu, Bihar, Assam and North East.
Idea then announced on 29 May 2014 that it had launched 3G services in Punjabs capital of
Chandigarh, with plans to extend the network to cover 170 towns across the state by the end
of 2015.
Looking to challenge its larger rival Bharti Airtel, Idea also won LTE-suitable spectrum
in the 1800MHz band for eight service areas Kerala, Maharashtra, Andhra Pradesh,
Karnataka, Madhya Pradesh, Punjab, Haryana and North East in the February 2014 auction.
According to Idea, the eight circles represent around 58.1% of its revenues and are home
to 74.7 million of the cellcos subscribers as at March 2014. In terms of a launch schedule
for 4G services, Idea has remained tight-lipped, noting that the actual timing of 4G services
launch would be based on the consumer demand, technology stabilisation and competitors.
Of the eight licences, six are in Ideas Leadership regions, whilst the remaining two are in
the Karnataka (Emerging) and North East (Growth) circles.
Idea has a history of co-operation regarding infrastructure, and in December 2007 Idea,
Vodafone and Bharti Airtel finalised an infrastructure sharing agreement involving the
transfer of about 70,000 mobile mast sites into a joint venture company, Indus Towers. In
December 2008 Idea confirmed it would transfer approximately 11,000 of its towers to Indus,
and said that the company will cover 15 of India's calling circles. By sharing sites, and
equipment such as electric generators, the trio said they hoped to reduce costs by avoiding
duplication of capital and operating expenditure and the company said it would build an
estimated 50,000 towers over the next two to three years. Vodafone and Bharti each have
a 42% stake in Indus, while Idea has the remaining 16%. Idea subsequently announced that
its scheme for the demerger of passive infrastructure (which will eventually be transferred
to Indus) to ICTIL (a wholly owned subsidiary of Idea), had been approved by the High
Court of Gujarat. As a result, in September 2009 infrastructure in nine telecom service areas
was moved to the control of ICTIL. As at end-March 2014, Indus operated around 113,000
towers, with a tenancy ratio of 2.07. Ideas cellular network features 21,381 3G cell sites and
104,778 2G sites, of which 9,446 are its own whilst 55,213 are Indus-owned and a further
40,167 leased from other wholesalers. Its 2G network covers a total of 7,394 census towns
and 344,108 villages (compared to 298,686 in March 2013).
Idea obtained national and international long-distance (NLD and ILD) concessions in
September 2006 and began NLD services using leased fibre capacity in April 2008; the
operator also carries part of its own inter-city traffic over its own backbone and holds internet
service provider (ISP) and IP-1 licences. The cellco owns and operates more than 82,000km
of fibre optic cable (OFC) and 2,500 OFC points of presence (PoPs) in major cities and
highways. Idea reported that in its fiscal 2014 (ended March 2014), its ISP capacity more

65

than doubled from 24.4Gbps to 54.7Gbps. ILD and NLD traffic also saw substantial growth,
expanding by 29.9% and 16.1% respectively. Ideas ILD traffic totalled 5.544 billion minutes
in 2014, whilst its NLD traffic reached 53.638 billion.
As at end-March 2014 Idea had a subscriber base of 135.8 million, up 11.7% year-on-year
and representing a 15.0% share of the market, improving from 14.1% twelve months earlier.
3G subscriptions meanwhile doubled in the year to end-March 2014, expanding to 10.2
million from 5.1 million a year earlier. As a result data contributed 10.1% of service revenue
in the quarter ended 31 March 2014, compared to 6.6% twelve months previously, whilst nondata value added services (VAS) declined from 8.6% of the total service revenue to 6.4%.
Idea has also registered a steady increase both in 3G data ARPU and data usage, with the
former growing by INR6 to INR111 per month, whilst usage has expanded to 462MB from
385MB.
At end-March 2014, Aditya Birla Group owned 45.81% of Idea Cellular; Birla Group's stake
is held via group companies Aditya Birla Nuvo (25.23%), Birla TMT Holdings(8.54%),
Hindalco Industries (6.88%), Grasim Industries (5.15%) and others (0.01%). Malaysias
Axiata Group Berhad holds a 19.89% stake in the company, whilst Providence Equity
Partners has a 9.94% shareholding.

Bharat Sanchar Nigam Ltd (BSNL)

Sanchar Bhavan
20 Ashoka Road
New Delhi 110001
India
Tel. +91 11 23730392
Fax +91 11 23353303
http://www.bsnl.co.in
State-owned fixed line incumbent Bharat Sanchar Nigam Ltd (BSNL) was a latecomer to the
cellular sector when it launched its first GSM services in November 2001. BSNL provides
mobile network services in all but two of India's 22 telecoms circles nationwide, with Delhi
and Mumbai covered by sister company Mahanagar Telephone Nigam Ltd (MTNL). As at
June 2014 BSNL's mobile network consisted of 68,162 base transceiver stations, all of which
had been upgraded to support 3G as well as 2G services. Its GSM infrastructure supports a
portfolio of services including WAP internet access and MMS over data platforms based on
GPRS (since 2004) and EDGE (launched in Gujarat in May 2006), while it also launched
location-based services (LBS) in October 2006.
With no lack of user demand for its 2G services, network capacity constraints have proved
the main obstacle to BSNL's growth, a situation it has attempted to address by commissioning
a series of large-scale infrastructure expansions which have been fraught with problems. In
May 2005 BSNL announced the first of its 'mega-tenders' for 45.5 million GSM lines, hoping
to take up the slack in one fell swoop. Legal challenges from ZTE and Motorola, which had
been disqualified for failing to meet technical requirements, dogged the process however. In
the interim, BSNL issued two contracts for a total of 20 million lines to state-owned vendor
Indian Telephone Industries (ITI). Attempts to relaunch the mega-tender in June 2006 and
May 2008 both failed, amid rumoured political interference. October 2010 saw the telco
open another auction for some 5.5 million lines, but the process was once again scrapped
in mid-2011. Meanwhile, at the start of November 2010, the Sanchar Nigam Executives
Association (SNEA), the workers union of BSNL, blamed European and American hardware
vendors for the operators delays in expanding and enhancing its mobile network. The union
reportedly sent a letter to the Indian Prime Minister, alleging that numerous complaints,
legal action and investigations prompted by the vendors since 2001 had derailed BSNLs
procurement of new equipment. Indeed, political interference in the operators running

66

surfaced once more in late 2013/early 2014, with the government instructing BSNL to
stick to the states preferential market access (PMA) policy, which requires the provider to
source a certain amount of its equipment from domestic manufacturers. According to the
Department of Telecommunications (DoT), United Telecoms Ltd and the India Electronics
and Semiconductor Association (IESA) had made complaints that BSNL had placed
restrictive product specifications and mandatory prior experience clauses in its tender,
limiting the involvement of native vendors. The governments position was reiterated in
January 2014, after the cabinet committee on economic affairs ruled that BSNL and MTNL
would be obliged to allocate 30% of their procurement orders to ITI.
Away from its failed efforts at large-scale GSM expansion, in September 2007 BSNL
finalised a USD1.3 billion deal with Swedish vendor Ericsson to supply both 2G and
3G infrastructure, including a GSM and W-CDMA (HSPA-enabled) radio access network
(RAN), transmission equipment and a complete GSM/W-CDMA common core network,
including mobile softswitches and an IP backbone network. Equipment delivery began in
October 2007. Around 15 million W-CDMA lines were originally included in BSNL's
aforementioned 2005 'mega-tender', but it subsequently said it was reluctant to deploy a 3G
network until regulations governing the technology were in place. The operator had been
handed 2x5MHz of frequency in the 2000MHz band in September 2006, covering Kolkata,
Pune (Maharashtra), Coimbatore (Tamil Nadu) and the northern city of Chandigarh, with
which to begin indoor trials of 3G services in partnership with Nokia. Prior to being given
the go ahead for a commercial 3G service launch, BSNL continued to fill the gaps in the high
speed data market by rolling out EDGE technology in phases, and in June 2007 it issued an
invitation to technology vendors to provide it with GPRS/EDGE PC/laptop datacards.
Whilst other operators remained at the mercy of the long-delayed auction process for 3G
services, BSNL and sister company MTNL jumped the queue and had received spectrum by
July 2008, effectively giving them the nod to begin commercial UMTS services two years
ahead of privately-owned rivals. Under the terms of the spectrum allocation it was stated that
the two operators would be required to match the highest bid from private operators for their
3G concessions once they were finally issued. In September 2008 BSNL announced that it
had started a trial 3G network in Pune for 2,000 users. Subsequently, February 2009 saw
BSNL inaugurate commercial 3G/3.5G operations in Chennai, noting that at launch it had
installed 25 base stations across the city, offering download speeds of up to 2Mbps compared
to the 144kbps available via its GPRS/EDGE services. The operator said it had set aside
INR27 billion for its third-generation rollout, revealing it aimed to cover in excess of 700
cities in the two to three months following launch. Despite the head start against its private
sector rivals, the introduction of 3G services was anything but smooth. Just one month after
launch, in March 2009 it was reported that the DoT had called on both BSNL and MTNL
to halt services after the country's Intelligence Bureau (IB) contended that the necessary
call monitoring facilities were not in place; BSNL argued that it had followed all required
security processes and said it would continue to provide the service. The cellco meanwhile
failed to meet its ambitious rollout target, announcing six months after launch that it had
expanded 3G services to a total of 111 cities. In addition to this, initial uptake was slow,
and in August 2009 BSNL revealed that it was cutting 3G tariff costs in a bid to improve
subscriber numbers; at that date the operator had signed up just 9,000 3G users. Reports in
September 2009 then claimed that BSNL was considering a proposal from Ericsson which
would see the latter help with marketing strategies; it was claimed that the Swedish vendor
had offered its consulting services to BSNL in a bid to help the telco with areas including
customer segmentation and 3G marketing. The initiatives put in place by the telco appeared
to pay off swiftly, and by the start of 2010 BSNLs 3G subscriber numbers had risen to
700,000, before passing the one million milestone by March that year. Four years on, the
cellco had an estimated 3.30 million 3G subscribers as at 31 March 2014.
Alongside its GSM mobile services, BSNL offers a CDMA wireless in the local loop (WiLL)
service, 'BSNL WLL'. Initially providing fixed-wireless and limited mobility services over
800MHz CDMA2000 1x and older IS-95A infrastructure, in January 2008 BSNL revealed

67

plans to launch fully mobile cellular CDMA services across its national footprint, bringing
it in direct competition with RCOM and TTSL. BSNL announced that its initial investment
would be around INR20 billion, and submitted a request to the government seeking approval
to provide CDMA-based mobile services under its existing licence; the DoT approved the
request in April 2008. BSNL implemented a series of upgrades to its WiLL network to
prepare for its nationwide CDMA cellular services, and in early March 2008 it announced
plans to extend the CDMA infrastructure across 500 towns with an investment of over
INR4 billion, while it also planned to increase coverage and capacity by constructing over
7,000 new base transceiver stations. Full mobility WiLL services have since been launched
nationwide, with the exception of Delhi and Mumbai.
In a bid to better compete with its rivals, in September 2009 BSNL revealed plans to
outsource management of its towers and cable networks. One potential roadblock, however,
was that of expected resistance from BSNL employees; any outsourcing would have likely
seen a reduction in the staffing levels at the company, with up 30,000 jobs possibly at
risk. The telco had initially considered the option of hiving off its towers and other related
infrastructure into a separate company, but halted work on such plans, claiming it would
be difficult to unlock value in this manner due to falling valuations for the tower sector.
Nevertheless, plans to spin off the cellcos tower assets into a new company were resurrected
in May 2011, although the strategy was ultimately put on the back burner. It was not until
2013 that the plans were resurrected as part of a revival programme to help the operator
cope with its growing losses and mounting debts. To that end, in December 2013 the DoT
applied to the cabinet for permission to spin off the tower assets of the cellco to a separate
company, arguing that the establishment of a distinct entity to hold and manage the towers
would unlock the true potential of the firms 61,622 towers. As with its previous attempt,
the move was challenged by the companys staff, who threatened to strike immediately if
any decision was made without the approval of BSNLs trade union. Meanwhile, January
2014 saw the Ministry of Personnel, Public Grievance and Pension also raise concerns on
the plans; its queries related primarily to the pension plans of the 3,000 BSNL and DoT staff
that would be absorbed into the new company. More recently, the DoT began investigating
the possibility of hiving off the 600,000km of fibre-optic infrastructure owned by BSNL in
March 2014, but at the time of writing (June 2014) there had been no further developments.
BSNL opened up its towers for sharing in 2010 but has had little success securing tenants
and, according to the DoT, the operator represents just 1% of the market for tower tenancies.
The watchdog went on to suggest an explanation for the failure of BSNLs tower business,
saying: There are several reasons for the low market share, which include lack of focussed
marketing mechanism for customer acquisition, the perception that BSNL towers have a
lower site uptime, pricing of infrastructure being more expensive than prevailing market rate,
the perception of conflict of interest between BSNL and non-BSNL tenancies and perception
of poor response to tenant complaints. BSNL seemed to make some headway in this area
in April 2014 when it entered into negotiations with newcomer Reliance Jio Infocomm Ltd
(RJIL) regarding a potential tower sharing deal.
The DoTs other plans to bolster the struggling cellco have arguably met with more success,
and in September 2013 the Group of Ministers (GoM) approved bailout measures, which
were then green-lit by the cabinet in January 2014. Under the recovery strategy, BSNL and
MTNL would relinquish their broadband wireless access (BWA) spectrum, for which they
would be refunded a total of INR110 billion. Other plans to aid the duo featured low interest
loans, the government taking on a portion of the telcos pension liabilities staffing costs are
the single largest burden on the two companies, and according to the DoT the employee cost
as a percentage of revenue is over 103% for MTNL and 49% for BSNL against the industry
average of less than 5%.
Bharat Sanchar Nigam Ltd (BSNL) is wholly state owned.

68

Tata Teleservices (TTSL, inc. TTML and Tata DOCOMO)

DLF Square
11 Floor M-Block
Jacaranda Marg
Gurgaon 122002
India
Tel. +91 124 2560500
Fax +91 124 2560619
http://www.tatateleservices.com
The main telecom operating arm Indian industrial conglomerate Tata Group, Tata
Teleservices Ltd (TTSL) launched as a fixed wireless provider, before transitioning to full
mobility services under the Tata Indicom brand. Tata Group made its first sortie into the
mobile market in 2002 through its acquisition of a majority stake in Hughes Tele.com,
which was subsequently renamed Tata Teleservices (Maharashtra) Ltd (TTML) and merged
with TTSL. TTML holds licences for the Maharashtra and Mumbai circles, whilst TTSL
holds concessions for the remaining 20 areas, after it purchased permissions for the Jammu
& Kashmir (J&K), Assam and North East areas in January 2008. Following an upgrade
from a wireless in the local loop-only (WiLL-only) IS-95A network to a CDMA2000 1x
WiLL/cellular platform, begun in November 2002, mobile services were rolled out across
Maharashtra and five other circles by January 2004, with SMS services added that month.
The following month Tata launched national CDMA roaming services and by February 2005
TTSL and TTML had completed the rollout of mobile services across the 19 licence regions
covered by the twin units at that date.
2008 saw the cellco begin to switch its focus to the 3G market, with Tata confirming in
August 2008 that it had set aside INR80 billion (USD1.84 billion) for investment, INR60
billion of which was earmarked for the construction of a pan-India GSM network, while
the remainder would be used to enhance the existing CDMA network. Giving the operator
a much-needed boost, Japans NTT DOCOMO agreed to pay USD2.7 billion for a 26%
stake in TTSL in November 2008. TTSL then announced in June 2009 that it had launched
commercial GSM services in Tamil Nadu, Kerala and Orissa before extending the network to
18 circles by the first half of 2010, offering services under the Tata DOCOMO banner. As at
end-June 2014, the cellcos footprint covered 19 operating areas, all except Assam, J&K and
North East.
Alongside its own branding, the company has explored partnerships with other well-known
enterprises. To that end, in February 2008 Virgin Mobile announced a deal with Tata to start
offering wireless services in India under the Virgin brand, specifically aimed at the youth
market. The UK-based mobile group quickly stated that it had no plans to construct its own
network or purchase an Indian operator, although the deal between the two companies was
not actually described as a mobile virtual network operator (MVNO) agreement, with Virgin
instead taking a share of the revenue in return for Tata using its brand name. Shortly after
the announcement the Department of Telecommunications (DoT) requested further details
regarding the agreement, with the exact nature of the arrangement understood to have caused
regulatory concern. A consortium of industry players, including Vodafone, demanded that the
DoT investigate the deal on grounds that it breached Indian law concerning MVNOs, but in
spite of the objections the regulator said that the launch could proceed. However, high hopes
for the new brand did not prove well founded, with uptake of CDMA-based Virgin Mobile
India services slow, prompting the cellco to extend the label to its GSM network in January
2010, ahead of a gradually nationwide rollout. The following month TTSL signed a similar
deal with retail giant Future Group, going on to launch GSM services under the T24 brand
in June 2010.

69

Operations in the Delhi circle proved problematic, thanks to the DoT withholding Tatas
4.4MHz spectrum allocation in that area. Only the intervention of the Telecom Disputes
Settlement and Appellate Tribunal (TDSAT) in July 2011 eventually prompted the watchdog
to hand over the frequencies. The tribunal criticised the governments almost three-year delay
in furnishing Tata with the spectrum after it sought assistance in the matter, with the cellco
having claimed that the regulator had arbitrarily favoured new entrants in the allocation of
spectrum in the metro. Meanwhile, in December 2013 TTSL relinquished 1.25MHz of excess
CDMA spectrum in 15 regions to avoid a one-off fee for holding more than 2.5MHz of
CDMA frequencies per circle. The cellco kept its additional spectrum holdings in the busier
Delhi and Mumbai areas, however, saying it would pay the charge. Elsewhere, TTSL has
so far avoided a fight with the authorities over 19 of its concessions which the Cellular
Operators Association of India (COAI) and a number of its rivals claim were invalidated by
the Supreme Courts mass licence cancellation in February 2012. The DoT ruled that as TTSL
had sought permission for the dual-technology use of its spectrum, rather than requesting
fresh concessions, its authorisations were not covered by the apex courts ruling.
In the much-delayed 3G auction TTSL was awarded concessions allowing it to offer thirdgeneration services in nine circles Gujarat, Haryana, Karnataka, Kerala, Madhya Pradesh,
Maharashtra, Punjab, Rajasthan, Uttar Pradesh (West) for a total cost of INR58.64 billion.
TTSL subsequently selected a European vendor, Nokia Siemens Networks (NSN), in August
2010 to support its 3G launch in four circles. The following month TTSL then announced that
Chinas Huawei would supply the necessary equipment for its launch of 3G services in five of
its licensed regions. In line with its self-imposed timeframe, in November 2010 TTSL began
commercial 3G operations in around 25 towns spread across all nine of the circles where it
held UMTS concessions. As at end-June 2014, Tatas 3G network covered 339 towns and
cities across its nine circles.
TTSL launched CDMA2000 1xEV-DO Rev A in March 2009, while EV-DO Rev B Phase
I services were introduced in October 2011 under the Photon Max moniker in five cities;
Mumbai, Kolkata, Delhi, Hyderabad and Chennai. The maximum potential download speed
at launch for Photon Max Rev B device users was advertised as 6.2Mbps, while the Rev
B Phase I platform has theoretical upload peaks of 3.6Mbps. The Phase I implementation
is a multi-carrier upgrade from Rev A (3.1Mbps maximum downlink), with Tata using two
carriers of 1.25MHz bandwidth for Rev B on its 800MHz network, therefore supporting
2x3.1Mbps (6.2Mbps) data transmission. Maximum theoretical upload speed is 3.6Mbps,
while the Huawei-supplied modems chosen by Tata support Rev B upgrades to 14.7Mbps
downlink. More recently, in June 2014 TTSL upgraded its EV-DO Rev B services for Photon
Max (Wi-Fi) modem users in three cities Delhi, Kolkata and Mumbai by implementing
Rev B Phase II technology, enabling up to 9.8Mbps theoretical download (while uploads
remain at a theoretical maximum of 3.6Mbps). Tata also confirmed that the Rev B Phase
II upgrade will be extended to eight other metro cities. The Photon Max Wi-Fi data device
(launched by TTSL in November 2013) acts as a personal Wi-Fi zone and can connect up to
five devices.
August 2009 saw TTSL sign a ten-year deal with Videocon Telecommunications (then known
as Datacom Solutions) allowing the latter access to TTSLs infrastructure. Under the terms of
the deal Videocon will lease both bandwidth and towers across India from TTSL. A second
deal was announced the following month, with TTSL inking a 15-year deal with state-owned
BSNL, giving it access to all of the latters infrastructure across the country. Yet another
infrastructure sharing deal followed in July 2013, with TTSL agreeing to lease 5,000 towers
to Reliance Communications (RCOM) in 14 circles, in exchange for which TTSL gained
access to its rivals CDMA towers.
Amidst speculation that Indias mobile market is ready for consolidation, and reports that
Tata Group plans to exit the telecom business entirely, TTSL has been linked with a number
of potential merger and acquisition deals. In June 2013 it was rumoured that Tata was
involved with Russias Sistema regarding a possible takeover of TTSL by Sistema Shyam

70

TeleServices (SSTL). Just two months later it was claimed that TTSL and SSTL were, in
fact, involved in talks with Aircel regarding a three-way merger, under which Sistema would
become the dominant shareholder. A separate rumour emerged in January 2014, with UKbacked Vodafone said to have begun talks with Tata Group regarding its potential acquisition
of the Indian firms stake in the cellco. Whilst rumours of takeovers abound, DOCOMO
confirmed in early 2014 that it is indeed planning to exit the company. Under the terms of
their 2009 joint venture agreement, Tata must either purchase DOCOMOs stake, or find
a buyer for the shares by the end of June 2014. Tata has negotiated to continue using the
DOCOMO name for a year after the Japanese company sells its stake, however.
Tata Teleservices (TTSL) is majority owned by the Tata Group, whilst Japanese giant
NTT DOCOMO holds 26.5% and state-owned Singaporean investment company Temasek
Holdings has a minority stake. In early 2014 DOCOMO confirmed its intention to sell its
stake, giving Tata until June that year to either find an alternative buyer for the shares, or to
buy out the Japanese company itself.

Aircel
5th floor, Spencer Plaza
769 Anna Salai
Chennai 600006
India
Tel. +91 44 28490849
Fax +91 44 28496769
http://www.aircel.com
Aircel launched GSM services in April 1999 in Tamil Nadu before expanding to the state's
metro circle of Chennai, although the two circles have since been merged. It launched GPRS
and EDGE services in 2004, but its limited reach led the cellco's founder parent, the Sterling
Infotech Group (now Siva Group), to begin touting the company to rivals. In a bid to raise
funds for expansion Aircel announced a plan to secure INR6 billion (USD136.2 million) in
an initial public offer (IPO), but called it off when Malaysia's Maxis Communications fended
off competition from domestic rival Telekom Malaysia to acquire Aircel for USD1.08 billion
in December 2005.
Its new parent set its sights on turning Aircel into a major player, and to that end began
enhancing coverage in its existing region of operation, while also looking to deploy its
GSM networks across a further seven northern and eastern circles Assam, Orissa, North
East, West Bengal, Jammu & Kashmir (J&K), Himachal Pradesh and Bihar. The latter
two were the last of the seven in which Aircel inaugurated commercial operations, at the
beginning of 2007. Alongside this, Maxis announced plans to spend a further USD1 billion
to expand Aircel's coverage and services, and the Malaysian firm's capital injection enabled
the operator to make a down payment on unified access service licences (UASLs) covering
14 additional regions in December 2006, namely Maharashtra, Karnataka, Rajasthan, Andhra
Pradesh, Gujarat, Delhi, Mumbai, Madhya Pradesh, Uttar Pradesh (East), Uttar Pradesh
(West), Kolkata, Kerala, Haryana and Punjab. The new licences reportedly cost a total
USD300 million, and gave Aircel scope to operate mobile networks in all 22 of India's
telecom circles, with the cellco quickly identifying Madhya Pradesh, Kolkata and Uttar
Pradesh (East and West) as the priority circles to enter first. However, it was not until
January 2008 that the Department of Telecommunications (DoT) confirmed it would issue
Aircel with 4.4MHz of start-up GSM spectrum in each of the circles it planned to enter.
Having finally acquired the frequencies it needed, in October 2008 Maxis announced a
USD400 million deal with Chinese hardware vendor ZTE that would see the latter provide
GSM infrastructure for Aircel's expansion. A flurry of launch announcements followed
the agreement, and in November 2010 Aircel completed its pan-Indian footprint with the

71

inauguration of commercial services in the Rajasthan circle, although this was slightly behind
a self-imposed June 2010 deadline.
Despite Aircels efforts at inaugurating services across its licensed regions, in February 2011
the DoT issued it a notice regarding the termination of mobile network operating licences for
delays in the rollout of commercial services. Aircel was given 60 days to respond as to why
it should not have concessions for three circles revoked, with the regulator claiming it had
failed to introduce services in line with the terms of its concession; licensees were required
to offer services in 90% of their service areas in metros and 10% in district headquarters
within twelve months of being awarded their concession. It was not until May the following
year that it emerged that Aircel had paid a penalty of INR742.8 million for failing to meet its
rollout obligations, though in January 2012 the Telecom Disputes Settlement and Appellate
Tribunal (TDSAT) actually ordered the DoT to refund the money, with 12% interest. This
order was reiterated in November 2012, when the Supreme Court instructed the government
to repay the penalties.
With its 2G rollout effectively complete, 3G has become an area of focus for Aircel. In
February 2007 the cellco revealed it had successfully tested a third-generation network in
Chennai in association with Chinese equipment vendor ZTE. Aircel subsequently said that it
would look to roll out 3G networks in at least 20 cities once the government completed the
much-delayed allocation of UMTS spectrum, but in the continued absence of 3G licences, it
installed WiMAX infrastructure in several cities to satisfy demand for wireless high speed
data services. Following the conclusion of the long-delayed 3G auction in May 2010, it was
confirmed that Aircel had successfully bid for 25MHz paired spectrum in 13 circles, paying
INR64.99 billion for the concessions. Having been allocated its 3G spectrum in September
2010, that month Aircel announced that it was aiming to inaugurate 3G services in the
first quarter of 2011, while also revealing that it would spend around USD500 million on
introducing the new services in the first year that they were available, with a total of just
over USD1 billion expected to be spent on both Aircels 2G and 3G networks combined
in that period; the operator had previously said it would spend around USD5 billion on its
infrastructure in the next three to five years. Alongside the unveiling of a preliminary launch
date, Aircel also detailed its subscriber targets, saying that it was aiming for a total subscriber
base of 75 million by end-2011, 10% of which (7.5 million) it hoped would have taken up
3G services by that date. In line with Aircels previously announced timeframe, in February
2011 the cellco announced the launch of its third-generation services, with upgraded speeds
initially available in Chennai. It was not until June 2013, however, that services were rolled
out to all 13 areas.
Aircel has looked to minimise expenditure and make the most of its investments in
infrastructure by signing deals with a number of its rivals. In September 2009 Aircel inked
a deal worth around USD400 million with Videocon Telecommunications (then known
as Datacom Solutions) allowing the latter access to around 5,000 of its cell towers. The
following month Aircel agreed a ten-year infrastructure sharing deal with state-owned Bharat
Sanchar Nigam Ltd (BSNL), under which Aircel is able to access some 45,000 base stations
nationwide. More infrastructure-related news came to light in January 2010, when Aircel
struck a deal with GTL Infrastructure to sell its tower business to the latter for INR84
billion. In April 2013, however, GTL launched legal proceedings against the cellco, seeking
compensation of between INR10 billion and INR15 billion, accusing the operator of failing
to meet obligations to provide new tenancies on the towers. Aircel rebuffed these claims,
saying that the companys poor management was to blame. The same month, Aircel signed a
bilateral tower sharing deal with Reliance Communications (RCOM). More recently, in April
2014 Aircel signed an intra-circle 3G roaming pact with RCOM and Tata Teleservices Ltd
(TTSL) after a TDSAT decision overturned rules banning the practice.
Struggling under high levels of debt from its acquisitions of 3G and 4G spectrum rights in
2010, Aircel has looked to cut costs and in October 2012 announced that it was reducing its
operations in five circles. Commenting on the decision to trim spending in Madhya Pradesh,

72

Gujarat, Haryana, Rajasthan and Punjab, a spokesperson for the company noted: Aircel is
revamping its business model innovatively to lower cost to serve without compromising
on customer service or network experienceThe telecom industry is facing severe margin
pressures as the voice market is maturing and the data demand in its true sense is still
nascent. Operational costs are high and incremental market demand for relatively new players
is prohibitive. In a further bid to cope with mounting financial pressures, in August 2013
the cellco unveiled plans to achieve break-even in nine-or ten circles by the end of March
2014, up from seven at that date. In addition to relying more heavily on infrastructure sharing
deals, the cellco has looked to renegotiate terms with its vendors to cut equipment costs. To
that end, in September 2013 Aircel entered into a strategic partnership with Indian handset
manufacturer Micromax to drive growth. Under the partnership, the two firms will share their
retail resources and run an integrated device sales activation programme.
As at end-June 2014 Aircels network covered all 22 operating areas, including the three
metro circles; Kolkata, Mumbai and Delhi. Elsewhere, the cellcos footprint was as follows:
Andhra Pradesh, eleven district capitals (DHQs), 177 towns and 707 villages; Assam, 27
DHQs, 125 towns and 12,519 villages; Bihar, 55 DHQs, 229 towns and 11,149 villages;
Gujarat, 15 DHQs, 77 towns and 383 villages; Haryana, twelve DHQs, twelve towns and 107
villages, Himachal Pradesh, ten DHQs, 346 towns and 5,599 villages; J&K, 21 DHQs, 77
towns and 5,919 villages; Karnataka, 14 DHQs, 230 towns and 2,517; Kerala, eight DHQs;
Maharahstra, 18 DHQs, 140 towns and 2,156 villages; Madhya Pradesh, 34 DHQs; North
East, 40 DHQs, 107 towns and 3,293 villages; Orissa, 29 DHQs, 127 towns and 16,321
villages; Punjab, eleven DHQs, 31 towns and 398 villages; Rajasthan, 17 DHQs, 70 towns
and 1,025 villages; Tamil Nadu, 31 DHQs, 3,982 towns and 13,305 villages; Uttar Pradesh
(East), 40 DHQs, 305 towns and 11,603 villages; Uttar Pradesh (West) four DHQs, 73 towns
and 769 villages; and West Bengal, 18 DHQs, 210 towns and 16,077 villages.
In December 2013 Aircel announced that it was looking to launch Long Term Evolution
(LTE) in its established cities within six months. The cellco holds the necessary broadband
wireless access (BWA) licences in eight areas. Aircels chief marketing officer, Anupam
Vasudev commented that banks had been more willing to assist with funding for the 4G
rollout, despite the companys association with a number of corruption cases and loss-making
operations issues that had previously complicated securing additional loans. Vasudev put
the change of heart down to a recent shift in Aircels strategy to concentrate on greater
profitability: The focus is very clear that you need profitable growth. That has been our
endeavour for the last year. And we will have to continue doing this for another year before
making any major investment. Later that month Aircel revealed that it had enlisted Chinese
vendor ZTE for its LTE rollout, the first phase of which will take place in the Tamil Nadu
circle, including Chennai.
Aircel is majority owned by Maxis Communications Berhad of Malaysia (74%).

Uninor (Telewings)
The Masterpiece
Plot No. 10 Golf Course Road
Sector 54, DLF Phase 5
Gurgaon, Haryana 122002
India
Tel. +91 0124 3329000
http://www.uninor.in
Indian real estate developer Unitech Group acquired wireless licences for all 22 circles in
January 2008 through seven subsidiaries subsequently merged into a single entity in 2010
before striking a deal with Norwegian telecoms giant Telenor. In October 2008 Telenor
agreed to acquire a 60% stake in Unitech Wireless through a series of four investment

73

tranches totalling INR61.2 billion (USD1.2 billion). The first tranche of INR12.5 billion
was completed in March 2009, granting Telenor a 33.5% stake in the cellco, though that
same month it said that, due to changing economic conditions, it would actually take a
67.25% stake in Unitech for the originally announced investment figure. Two months later
Telenor increased its holding in the cellco to 49% with the completion of the second round
of investment totalling INR11.3 billion, although further increases required the permission
of the Foreign Investment Promotion Board (FIPB). January and February 2010 saw Telenor
finalise its third and fourth rounds of investment respectively, increasing its stake in the
cellco first to 60.1% then 67.25%.
With the backing of a major telco, the first details of launch preparations were reported in
February 2009, when it was announced that the would-be operator had entered into tower
sharing agreements with Wireless-TT Info Service, a subsidiary of Tata Teleservices (TTSL)
and Quippo Telecom Infrastructure; the 20-year agreements covered approximately 40,000
sites nationwide. For the rollout of its own network, contracts were handed to Alcatel-Lucent
(Kerala and Orissa), Huawei (Karnataka, Andhra Pradesh and Tamil Nadu), Ericsson (Bihar,
Uttar Pradesh [East] and Uttar Pradesh [West]) Nokia (Gujarat, Maharashtra, Rajasthan,
Punjab, Jammu & Kashmir [J&K] and Himachal Pradesh) and ZTE (Delhi, Madhya Pradesh
and Haryana). Meanwhile, in September 2009 Telenor confirmed that the cellco would offer
services under the Uninor banner, with the Norwegian company claiming it would leverage
the group's established marketing and design framework. Uninor was granted national longdistance and international long-distance (NLD and ILD) licences in July 2009. Commercial
services were inaugurated in eight circles in December 2009, namely Tamil Nadu, Kerala,
Karnataka, Andhra Pradesh, Uttar Pradesh East, Uttar Pradesh West, Bihar and Orissa. In
May 2010 the operator simultaneously launched commercial services in five further circles,
those being Mumbai, Maharashtra, Gujarat, Kolkata and West Bengal. GPRS was introduced
in seven circles in April 2010 and by August that year it had rolled out the technology in all
13 areas where it had deployed 2G services.
Despite having commenced operations in a number of its licensed regions, the Telecoms
Regulatory Authority of India (TRAI) in November 2010 called for a number of 2G
concessions, including some held by Uninor, to be cancelled for non-rollout of services.
The Department of Telecommunications (DoT) waded in to the matter the following month,
issuing a notice penalising the cellco for failure to launch services in line with its concession.
In early January 2011 Uninor took the matter to the Telecom Disputes Settlement and
Appellate Tribunal (TDSAT) having reportedly paid liquidated damages for failing to meet
rollout deadlines in four circles, although at that date it had yet to make payments for
a further six circles. Uninor argued that the regulator had not calculated the rollout time
correctly, and claimed it had not been given an opportunity to put forward its own account.
Further, it blamed the DoT itself for the hold up, saying that it is the DoT that is singularly
and solely responsible forcausing the delay in meeting rollout obligations by [a] delay
in SACFA (Standing Advisory Committee for Frequency Allocation) clearance, [a] delay in
allocation of the complete start up spectrum and introducing new and onerous mandatory
requirements. Despite noting that the operator had raised some arguable questions over
the DoTs levy, the TDSAT instructed Uninor to pay 60% of the penalty within two weeks.
The matter did not end there though, and January 2011 saw Indias Supreme Court issue
notices to both the Central Government and eleven private telecoms operators, including
Uninor, regarding a petition which sought to cancel those 2G spectrum licences it claimed
were handed to companies either ineligible for such concessions or those that failed to fulfil
rollout obligations.
Just over a year later, in February 2012 the Supreme Court cancelled 122 concessions issued
in 2008, including all of Uninors licences. Despite leveraging its diplomatic connections
the Norwegian state is a stakeholder in parent Telenor Group Uninor was unsuccessful
in appealing the apex courts decision and was forced to repurchase its concession if it
wished to continue offering services. Despite threatening to quit the sector over the high
reserve prices for frequencies in the auction to resell the cancelled concessions, Telenor

74

stayed and was one of a handful of companies to participate in the sale. It did, however,
cut back its footprint, successfully bidding for spectrum in six circles and closing down
operations in six of its seven other circles. Amidst speculation that the cost of spectrum in
the metro circles might be reduced for the second round of auctions, Uninor delayed closure
in Mumbai, although in February 2013 the Supreme Court ordered cellcos to cease offering
services in any circles that they had not bid for spectrum in. As a result, the cellco was
obliged to suddenly disconnect around 1.8 million subscribers in the financial capital, refund
the affected customers and assist in porting their numbers to other operators. Telenor bid
for the spectrum via a new company, Telewings a joint venture split 49/51 between the
Norwegian group and new Indian partners Lakshdeep Investments and Finance in an effort
to avoid any fallout from its acrimonious split from its former partner that was ongoing at
the time (see below). The change raised the question of whether Telenor would be allowed to
offset the amount paid for its licence renewal by the amount originally paid for the cancelled
concessions in 2008 as was allowed for other cellcos, as the companies bidding in 2008 and
2012 were separate entities. A decision was finally reached in April 2014 and Telenor was
granted permission to offset its repurchase costs by INR16.6 billion.
In the wake of the Supreme Courts ruling, Telenor had immediately attempted to oust
Unitech from the partnership in a series of court battles. The Norwegians efforts proved
unsuccessful, however, and the group eventually agreed to buy out its erstwhile partners in
October 2012, as the real estate firm became embroiled in difficulties of its own, including
a substantial tax bill and charges of corruption in relation to the original allocation of 2G
licences in 2008. Telenor established its new JV Telewings with Lakshdeep Investments that
same month, with the Norwegian parent paying some NOK10 billion (USD1.674 billion) to
clear all interest-bearing borrowings that year as part of the process of closing down Unitech.
The handover was completed in December 2013, with Telenor announcing that the new entity
had received its six new 20-year unified licences and that the assets of the former Unitech
Wireless had been successfully transferred to Telewings the asset transfer had been greenlit by the relevant authorities the previous month.
Despite the transition from Unitech to Telewings, in April 2014 the DoT revealed that it
was considering imposing a fine of up to INR3.5 billion on Uninor for failing to secure
the watchdogs approval when it combined its seven subsidiaries into a single company in
2010. According to the regulator the amalgamation equated to a stake sale by the companys
promoters, taking the stance that the shareholders sold all their shares in the respective units
for the merger to go ahead. This transaction would have been illegal, however, as the terms
of the licence forbids promoters from selling their stakes in telecom providers for three years
or before the company meets rollout obligations. The seven divisions, then operating under
the Unitech Wireless name, had been granted their concessions in 2008 and had not satisfied
their rollout requirements by the time of the merger in 2010, rendering the transaction illegal
in the eyes of the regulator. For its part, the operator claims to have followed the necessary
procedures and secured permission from the Delhi High Court before combining the various
units, a spokesperson for Uninor adding: Four years ago, Unitech Wireless had conducted
this amalgamation that we believe was in accordance with the applicable laws and licence
terms, following the due process, subsequent to a favourable order from the High Court and
keeping all government authorities notified as required at each step.
Reacting to the mass licence cancellation in 2012, Uninor cut back its operational footprint to
just six circles, with a view to achieving EBITDA breakeven point throughout its remaining
areas. The cellco placed a greater focus on the mass market with low priced tariffs, whilst
taking measures to trim its expenses and implementing an ultra-low cost operating model.
Amidst the low-cost offerings provided by Uninor, was its Sabse Sasta challenge, through
which it guarantees to provide the cheapest tariff in each circle. Under the offer, Uninor
challenges customers to find a cheaper plan with a rival firm and rewards the user with ten
times the difference between the two in credit. The cellcos new low-cost approach began
to reap dividends almost immediately, with the cellco reaching breakeven in its first circle,
Uttar Pradesh (East), in November 2012. In its press release, Uninor noted that it served

75

7.2 million subscribers in the circle at the time, adding: Uninor incurs a cost of [INR0.18]
per minute, the lowest among all operators in the circle. Its spectrum usage efficiency is
40% higher than all others. Uninor hit its breakeven goal in Gujarat in May 2013, whilst
Andhra Pradesh followed in July that year. Announcing that the cellcos operations in Uttar
Pradesh (West) and Bihar had reached breakeven in September 2013, Uninors head for the
Bihar circle defended the companys strategy, saying: We are proud to dispel the myth that
telecom investments in Bihar and Jharkhand are unattractive from a financial viewpoint. With
our break-even, we prove that investing in a market with low ARPUs and needing affordable
services the most can be a financially prudent decision. The cellco missed its target of
achieving positive EBITDA by the end of 2013, although it succeeded in improving its net
losses for the year from NOK6.283 billion in 2012 to NOK576 million in the following fiscal
year.
Despite its low-cost operating model, Uninor steadily expanded the footprint of its networks
in its six circles in 2013. More recently, the cellco announced in February 2014 that it would
invest INR6.07 billion over the following five months to install 5,000 new network sites and
increase coverage by 30% to cover 50 million more Indians. On a regional basis, the cellco
said it would add sites in Gujarat (800), Maharashtra (1,000 new sites), Uttar Pradesh East
(800) and Uttar Pradesh West (1,050). The cellco won additional spectrum for four of its
existing six areas in the February 2014 frequency auction, and purchased airwaves to roll out
services in the Assam circle. With the additional 1800MHz spectrum, Uninor said it could
enhance its voice and data capacity by between 20% and 25% in Uttar Pradesh (East), Uttar
Pradesh (West), Bihar and Andhra Pradesh.
As at end-June 2014, Uninors coverage stood as follows: Andhra Pradesh 23 districts, 185
cities and 2,736 villages; Bihar, 61 districts, 253 cities and towns and 8,148 villages; Gujarat,
25 districts, 234 cities and 1,896 villages; Maharashtra, 35 districts, 360 towns and 2,665
villages; Uttar Pradesh (East), 46 districts, 365 cities and 32,146 villages, and; Uttar Pradesh
(West) 28 districts, 363 cities and 9,091 villages.
Growing data use led to a 13% year-on-year increase in ARPU in local currency in Q1 2014
and in March 2014 the cellco changed its approach to data services to better fit its target
market. Uninor unveiled a range of new plans offering unlimited access to Facebook and
WhatsApp for between an hour and a month. Unveiling the offer the cellco commented that
it was moving away from volume-based internet offerings to service-based plans, adding
that around 50% of Indias mobile subscribers are active on Facebook and/or WhatsApp.
Morten Karlsen Sorby, the cellcos CEO commented on the change of tack: Selling internet
as rupees per MB is like selling air or train tickets as rupees per kilometre. What customers
do with internet is to use it for services like Facebook or Whatsapp. Our plan is to make
these services the cheapest on Uninor. For us, internet will always be about affordability and
relevance.
Telewings (Uninor) is 74% owned by Norwegian telecoms group Telenor, whilst the
remaining 26% is held by local partner Lakshdeep Investments.
Uninor was originally the brand name of Unitech Wireless, a joint venture between Telenor
and Indian real estate firm Unitech. In October 2012, however, the Norwegian firm bought
out its former partners, before going on to establish Telewings which continues to offer
services under the Uninor banner as a 49/51 JV with Lakshdeep. Telenor subsequently
increased its stake in the new firm to 74% in June 2013, before it completed the transfer of
assets from the former Unitech Wireless to the new entity in December that year.
Telenor announced in June 2014 that it had applied to the Foreign Investment Promotion
Board (FIPB) for permission to spend INR7.8 billion (USD131.54 million) on increasing its
stake in Telewings to 100%.

76

Sistema Shyam TeleServices (SSTL, MTS India)

334 Udyog Vihar
Phase-IV
Gurgaon, Haryana 122001
India
Tel. +91 124 4615899
http://www.mtsindia.in
Sistema Shyam TeleServices (SSTL, formerly Shyam Telelink) initially offered fixed line
and limited mobility services under a technology-neutral Unified Access Service Licence
(UASL) in Rajasthan. It began rolling out 800MHz CDMA IS-95A wireless in the local loop
(WiLL) services in late 1998 in partnership with Alcatel-Lucent, and launched a CDMA2000
1x WiLL network in September 2003, also in the 800MHz band. Subsequently, in October
2007 SSTL was given approval in principle by the Telecoms Regulatory Authority of India
(TRAI) to begin offering GSM services in Rajasthan under its UASL, and in January 2008
it received permission from the Department of Telecommunications (DoT) to expand into
other circles nationwide, subject to buying the required UASLs and being allocated spectrum.
Having taken control of the company in late 2007, the operators majority shareholder,
Russian conglomerate Sistema, unveiled plans to turn it into a pan-Indian telecoms operator,
announcing it would invest around USD1 billion on expansion, including USD500 million to
buy CDMA/GSM licences/spectrum and USD500 million on rolling out networks.
Having indicated that it would focus on deploying CDMA-based infrastructure, citing
increased financial benefits as the core reason for such a strategy, in April 2008 SSTL
received 800MHz frequencies in seven of the countrys telecom circles Andhra Pradesh,
Tamil Nadu, Haryana, West Bengal, Himachal Pradesh, Bihar and Uttar Pradesh from
the DoT. Coupled with spectrum it had already obtained in Rajasthan, Jammu and Kashmir
(J&K), Assam and North East, the telco set about rolling out its CDMA network. SSTL
subsequently announced the launch of a CDMA-based 800MHz mobile network in Rajasthan
in October 2008, offering commercial services under the brand name 'Rainbow'. SSTL
swiftly detailed further expansion plans and in March 2009 it inaugurated CDMA-based
services in the Tamil Nadu and Kerala circles, at the same time announcing a rebranding; the
Rainbow moniker was dropped in favour of the MTS (Mobile TeleSystems) brand utilised by
other subsidiaries of parent company Sistema.
May 2009 saw SSTL announce a seven-year deal with ZTE for the provision of network
equipment and infrastructure to further assist with its expansion ambitions, and that same
month it was reported that its footprint had been extended to Kolkata and West Bengal.
A rash of launches followed, with Bihar (July), Delhi and Karnataka (October), Mumbai
(December), Haryana and Maharashtra (January 2010) and Andhra Pradesh (May 2010) all
coming online to increase the cellcos presence to twelve of Indias 22 circles. To further
support future growth, in November 2009 SSTL signed a deal with state-owned telco Bharat
Sanchar Nigam Ltd (BSNL) under which the latter agreed to lease bandwidth and telecom
towers to SSTL; no financial details of the deal were disclosed. The end of 2010, meanwhile,
saw another batch of launch announcements, with SSTL inauguratinge services in Gujarat,
Uttar Pradesh (West) and Uttar Pradesh (East) in the last month of the year, bringing the total
number of circles where it was operational to 15.
In August 2009 SSTL committed to utilising CDMA 1x technology, with the upgrade
designed to improve both voice capacity and data speeds. Offering high speed data services
over its existing CDMA network risked the ire of a number of GSM operators, which had
in the past complained about such services; the Cellular Operators Association of India
(COAI) previously sought DoT intervention to halt such offerings, claiming that, as they
were based on 3G EV-DO technology, it was legally untenable to permit select players to
effectively gain a head start in offering 3G services. Nonetheless, in October 2009 SSTL

77

quietly launched its CDMA2000 1xEV-DO-based MBlaze wireless internet option in Delhi,
with a larger scale launch subsequently following a month later, when the service was
extended to a number of other larger cities, including Chennai, Coimbatore and Kolkata.
Further technology appeared to be on the horizon following the May 2011 announcement
that long-time partner ZTE had been selected for what was claimed to be the worlds first
commercial launch of CDMA EV-DO Rev B Phase II. A further announcement followed in
September that year confirming that the introduction of the technology was underway, with
SSTL that month beginning rolling out the platform to in Jhaipur in the Rajasthan circle.
Derailed by regulatory uncertainty however, it was not until June-July 2013 that the cellco
resumed the expansion of its Rev B network, deploying the system in four more cities in
Rajasthan. By October that year MTS had made the upgraded platform, offered under the
MBlaze Ultra brand and providing download speeds of up to 9.8Mbps, available in all nine
of its operating areas. Meanwhile, its basic EV-DO service had been rolled out to more than
600 towns and cities across its nine areas. In order to meet rising demand for its data services,
in November 2013 SSTL began deploying a fibre-optic backbone network. Commenting on
the work, CTO Ashwini K Khillan said: We are working towards deploying at least one fibre
node for [every] ten-15 BTS [base transceiver station] sites Most of the sites are already
running on IP and aggregated microwave layers.
SSTLs licences were amongst the 122 concessions revoked by the Supreme Court in
February 2012. Whilst the operator joined its peers in protesting against the order, the cellco
made use of its ties to the Russian government and tapped diplomatic channels in a bid to
pressure the Indian government into rescinding the cancellation. Parent company Sistema
threatened the Indian state with arbitration, claiming that it had violated the terms of the
bilateral investment protection treaty signed between Russia and India. With no sign of the
government changing its stance by November 2012, the cellco opted not to participate in the
auction to repurchase its spectrum, convinced that its permissions would be returned once
its case was eventually heard by the Supreme Court. In the event, however, the apex court
quickly dismissed the Russian companys claims in February 2013, although the cellco was
granted a reprieve and allowed to continue operating until it could purchase fresh licences.
Following the Supreme Courts rejection of SSTLs case, the cellco closed down its
operations in ten circles in a bid to cut costs, noting that the uncertainties from the licence
cancellations had prompted it to conserve its resources. Services were terminated in Assam,
Andhra Pradesh, Bihar, Himachal Pradesh, Haryana, Jammu & Kashmir, Madhya Pradesh,
North East, Orissa and Punjab, although the provider added that these circles accounted for
less than 15% of its total subscriber base. SSTL proved to be the only cellco interested in
participating in the second auction in March 2013, where it won rights to airwaves in eight
circles. The provider noted that it had taken into consideration spectrum pricing, the level
of competition, future potential for data services and the number of carrier slots available.
Utilising a similar strategy to that of its Norwegian-backed rival Uninor, SSTL aims to
achieve OIBDA breakeven by end-2014, or within the first half of 2015.
Repurchasing its licences in March 2013 did not end SSTLs problems with the state
regulators, however, and the cellco has since become embroiled in a battle with the
watchdogs over the use of the 800MHz CDMA spectrum. Recommendations put forward
by the TRAI in H2 2013 for a future spectrum auction excluded the 800MHz spectrum,
citing a lack of interest in the frequencies, preventing SSTL from purchasing spectrum
resources to expand its footprint. SSTL railed against the decision, noting that as with
its GSM-based competitors it had been cautious in its bids due to the high reserve prices
and regulatory uncertainty, with CEO Dmitry Shukov explaining: Had reserve price[s]
for 800MHz band spectrum been reasonable, we may have bought more spectrum in eight
circles and participated in auction for remaining 13 circles and continued with pan-India
operations. The official pointed out that SSTL has already invested USD3.6 billion in
the market and would need to secure additional spectrum to meet growing demand from
customers and maintain quality of service, adding that the last-minute decision to withhold

78

the sale of 800MHz spectrum was indicative of the mercurial regulatory environment, which
had undermined investor confidence.
SSTL continued to fight with the regulators through early 2014, crying foul once more
following the announcement in February 2014 that the TRAI, having acquiesced to
auctioning the 800MHz frequencies, had suggested a much higher reserve price than that set
for the 1800MHz sale that had taken place that month. The regulator had suggested a price
tag of INR26.85 billion per MHz for the 800MHz airwaves, compared to the base price of
INR17.65 billion for the 1800MHz frequencies. Accused of discriminating against CDMA
providers by SSTL, the TRAI justified its decision by saying that the lower frequency band
was worth more as it could be used for Long Term Evolution (LTE) services.
Sistema Shyam TeleServices (SSTL) is owned by Russian services conglomerate AFK
Sistema (56.68%), Indian industrial firm Shyam Group (24.00%), the Russian Federation
(17.14%) and others (2.18%).
In July 2013 the government passed legislation allowing 100% foreign direct investment
(FDI) in telecoms operators, although any deal which raises FDI above 74% must be
approved by the Foreign Investment Promotion Board (FIPB). In May 2014 Sistema applied
to the FIPB for approval to increase overseas ownership in SSTL above the 74% threshold,
but was denied the following month. According to the Department of Telecommunications
(DoT), the proposals had been rejected as the suggested stake increase had been structured as
an overseas debt deal rather than FDI.

Mahanagar Telephone Nigam Ltd (MTNL)

5th Floor, Mahanagar Doorsanchar Sadan
9, CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +011 24310212
http://mtnlmumbai.in
http://mtnldelhi.in
Mahanagar Telephone Nigam Ltd (MTNL) is the state-run incumbent fixed line operator
in the Delhi and Mumbai telecom circles, and it launched post-paid GSM mobile services
in both metropolitan regions in February 2001 under the Dolphin brand name before
introducing its Trump pre-paid service in January 2002. Having operated CDMA WiLL
networks based on IS-95A and CDMA2000 1x technology since May 1997 and May 2003
respectively, MTNL launched limited mobility (or WLL-M) CDMA cellular services in
Delhi in June 2006, and Mumbai the following month, under the Garuda brand. The DoT
considered a proposal to allow MTNL to become a pan-Indian operator, but at the beginning
of 2009 it was confirmed that the application had been rejected.
The future of MTNL's wireless operations were briefly in doubt in 2004 when it came under
fire from the Department of Telecommunications (DoT) for poor financial efficiency and
quality of service, leading the government to propose bringing it under the management
of sister company Bharat Sanchar Nigam Ltd (BSNL). MTNL's GPRS-based services went
live early the following year, although the telco opted not to deploy 2.5G EDGE services,
choosing instead to focus on 3G UMTS technology. From 2006 onwards 3G was included in
all of MTNLs GSM supply contracts, pre-empting its introduction of W-CDMA services.
The DoT announced in July 2008 that MTNL would receive one block of 3G spectrum in
Delhi and Mumbai. In return for the spectrum allocation it was advised that it would be
required to match the highest bid by privately-owned players for third-generation spectrum,

79

when the sale process concluded. Following the spectrum award, MTNL met a self-imposed
rollout target, soft-launching its 3G network in Delhi in late 2008, though a full commercial
launch under the Jadoo banner was delayed until February the following year. Some five
months after launching its third-generation services, MTNL revealed that it was introducing
a pre-paid tariff in a bid to increase take-up in June 2009, following reports that it had
attracted just 400 3G subscribers since introducing the technology to the public. In another
effort to spur 3G uptake, MTNL announced a tender for operators interested in acting as 3G
franchises on its behalf, but in August 2009, following limited interest, UK-backed Virgin
Mobile and Spice Group were revealed as the only two bidders. MTNL shortlisted Virgin
Mobile to manage its 3G network in Delhi and Bombay at the beginning of December 2009.
In September 2009, MTNL launched another initiative to drive 3G sales, offering Mumbai
customers a free trial. Sweetening the deal, in April 2010 MTNL began offering a mobile TV
service that it claimed provided MPEG4 picture quality.
In September 2007 the DoT turned down a request from MTNL for more GSM-900 spectrum
in Mumbai and Delhi on the basis that there was none available, noting that additional
frequencies were only likely to become available once the military had relinquished them. In
October 2009, however, it was reported that MTNL had been awarded a total of 12.4MHz
of spectrum in the Delhi and Mumbai circles, more than its privately-owned rivals received.
The Telecom Regulatory Authority of India (TRAI) sought to redress the balance, however,
and called on the DoT to retrieve the excess spectrum. Indeed, in the TRAIs April 2012
recommendations for the re-auction and refarming of spectrum it highlighted the importance
of reclaiming the extra 2.4MHz of that MTNL held in each of the two Metro regions: the
TRAI and DoT had previously confirmed that 10MHz of spectrum per operator was sufficient
for the two cities.
With the countrys much-delayed 3G auction finally concluding in May 2010, both MTNL
and BSNL approached the DoT with a plea to refund payments made toward their respective
third-generation spectrum allocations. In June 2010 local press reports claimed that the
regulator had rejected the approach, however, despite the operators argument that they were
in effect not given any choice regarding whether they wished to acquire 3G spectrum. While
there was a general belief that the Union Cabinets consideration of the matter would lead
to no different a decision, in early July 2010 then telecoms minister Andimuthu Raja called
for the state-owned telecoms duo to be refunded monies paid for 3G and broadband wireless
access (BWA) spectrum. The minister argued that the telcos were undertaking a social
obligation by extending services to remote rural regions. Despite the unexpected support, it
was suggested that the Finance Ministry would reject the request to waive the fee for fear
that it could prompt private operators to make similar demands. In the event, whilst the
cellco was not refunded for its 3G licence fee, in January 2014 the government did approve
compensation for MTNLs returned BWA frequencies.
The Indian government holds a 56.25% stake in Mahanagar Telephone Nigam Ltd (MTNL),
with the remaining 43.75% in the hands of foreign institutional investors, banks, mutual
funds and individuals.

Videocon Telecommunications Ltd. (formerly Datacom)

248, Udyog Vihar
Phase IV
Gurgaon, Haryana 122015
India
http://www.videocontelecom.com
Videocon Group acquired pan-India spectrum in January 2008 via its telecom services arm
Datacom Solutions, paying INR16 billion (USD407 million) for the Unified Access Service
Licences (UASLs). Disagreements between the Dhoots, owners of Videocon Group, and

80

HFCL group chairman Mahendra Nahata, who was the original promoter of the company and
held a 36% stake in Datacom, culminated in October 2008 with CEO Ravi Sharma abruptly
resigning, pushing back a proposed December 2008 rollout to May 2009. The disagreement
was brought to a close by January 2010, with Videocon at that date taking full control of
Datacom and subsequently renaming it as Videocon Telecommunications Ltd (VTL).
Nevertheless, it was not until March 2010 that Videocon finally launched services,
inaugurating its network in Mumbai under the Videocon Mobile Services banner the
moniker was dropped in September 2013, when the cellco was renamed Videocon Telecom.
The pace of the operators rollout began to gather speed, with a commercial launch taking
place in Tamil Nadu in March, followed by Mumbai in early April and Gujarat, Haryana
and Punjab later that month. Having said that it expected to have extended its reach to all
of Indias major states by the end of September 2010, coverage expansion continued, with
launches in Kerala (June 2010) and Madhya Pradesh (August 2010). In February 2009 VTL
had announced a deal worth an estimated INR5 billion with Chinese vendor Huawei for the
rollout of its network in nine circles, with the latter agreeing to provide mobile connections
for eight million subscribers. The cellco followed this up in August 2009 with the signing of
a ten-year infrastructure sharing agreement with mobile operator Tata Teleservices (TTSL).
Under the terms of the deal Videocon agreed to lease both bandwidth and towers nationwide
from TTSL; Wireless-TT Infoservices (WTTIL), a joint tower venture between TTSL and
Quippo Telecom, said it would provide passive infrastructure, while TTSL itself would
provide transmission services. It was suggested that, with both VTL and TTSL in the process
of rolling out GSM networks, the two operators saw the deal as a means of enabling both
of them to reduce operating costs. A similar deal was announced the following month, with
VTL and Aircel signing a USD400 million tower sharing deal that would allow the former to
gain access to around 5,000 of Aircels 15,000 towers.
Irrespective of VTLs efforts in rolling out its network, in November 2010 the Telecom
Regulatory Authority of India (TRAI) called for a total of 62 wireless licences belonging
to five operators to be cancelled amid growing criticism of the handling of the sale of
2G concessions in early 2008. VTL was named as one of those operators facing having
its concessions withdrawn on the basis that its rollout had not been satisfactory, with the
regulator indicating that the cellco could lose permission to operate in ten circles. With
the scandal over the allocation and utilisation of 2G spectrum growing, in January 2011 it
was revealed that VTL had been directed by the Telecom Dispute Settlement and Appellate
Tribunal (TDSAT) to pay 60% of the penalties that had been imposed on it for allegedly
failing to roll out services in line with the terms of its concessions. Worse was soon to
follow, and in February 2012 all of VTLs concessions were revoked under a ruling issued
by the Supreme Court (see Wireless Legislation for details). Nonetheless, in March that year
the cellco confirmed it planned to stay in the market, saying it would participate in the
upcoming frequency re-auction. Later that month, however, it was claimed that Videocon
would close down operations in most circles, maintaining a presence in only Tamil Nadu,
Punjab, Haryana, Madhya Pradesh and Mumbai. Such rumours proved well founded in May
that year, when VTL announced that it was shutting up shop in Kerala. In November that
year, the cellco took part in the spectrum auction to repurchase its lost licences. Taking a
conservative line similar to that of rival Uninor, Videocon purchased concessions for six
circles, securing 2x5MHz blocks in Bihar, Gujarat, Haryana, Madhya Pradesh, Uttar Pradesh
East and Uttar Pradesh West.
In March 2013 Videocon outlined its intention to use its 1800MHz spectrum for 4G Long
Term Evolution (LTE) services in its six licensed circles and said it planned to launch
the advanced network by the end of the year. Having also secured pan-India national and
international long distance (NLD and ILD) licences, Videocon also said at that date that it
intended to become a major player in the long distance segment. August that year saw the
cellco announced that it would launch LTE by August the following year.

81

More recently, commenting on the companys decision not to participate in the February
2014 spectrum auction, Videocons director and CEO Arvind Bali explained that his
company had considered purchasing additional spectrum to relieve congestion in Punjab, but
found there were no blocks of spectrum available in the areas needed. Similarly, the operator
was said to have looked into a potential expansion into the Delhi circle, only to cancel the
plans following an analysis of the business prospects. With the executive also noting that
Videocon had spectrum in three circles Uttar Pradesh East, Uttar Pradesh West and Bihar
where it has not yet deployed networks, he said: These circles are very big and each requires
15,000 sites to be put there, on which a big customer base could be acquired. Hence, we
decided to primarily focus on these circles. In totality, we decided not to focus on spectrum
now. On the cellcos plans for 4G, it was confirmed that Videocon is planning to deploy
Frequency Division Duplex (FDD)-LTE in the 1800MHz band, but is currently held back by
the limitations of the ecosystem and its own spectrum holdings. As such, the provider intends
to wait until voice-over-LTE (VoLTE) becomes available, enabling the use of voice and data
over the same channel, and will dedicate 5MHz of spectrum to the new technology. Tangible
steps towards a 4G launch followed in June 2014 though, at which date Videocon partnered
with Huawei for its LTE rollout with the Chinese vendor providing its Evolved Packet Core
(EPC) technology for the core network.
Amidst speculation that a number of Indias smaller providers might by snapped up the
markets dominant players, Videocon revealed in February 2014 that it was open to
consolidation and that it was involved in talks with potential strategic and financial partners
with a view to growing its business. Chief executive Arvind Bali was quoted as saying: Like
any growing organisation, we too seek partnerships and investments to grow our business,
and there is interest shown by others for partnering and investment. Though such decisions
take time and will be taken at the board level, we are open to exploring investment avenues
and partnering with others. Bali dismissed doubts about Videocons future in the sector,
however, adding: We have made a comeback early last year with a regional presence and
a strategic footprint in seven circles. This is the Hindi-speaking belt accounting for 42% of
the countrys population. We have lots in hand, including rollouts in UP-West, UP-East and
Bihar and a 4G LTE rollout.
Videocon Telecommunications Ltd (VTL) is wholly owned by industrial conglomerate
Videocon Group.
In early January 2015 Videocon Group co-founder Rajkumar Dhoot revealed that the
company was willing to sell up to a 49% stake in Videocon Telecom and would relinquish
management control of the firm. Later that week, the groups chairman confirmed that it
had recieved interest from two companies, a Mexican firm and an Indian telco, although
the official clarified that no deal would take place until the government provided clarity on
merger and acquisition rules. Further, the company would not consider selling before the
February 2015 spectrum auction.

Quadrant Televentures (formerly HFCL Infotel)

8 Commercial Complex
Masjid Moth
Greate Kailash-11
New Delhi 110048
India
Tel. +91 17 25090000
Fax +91 17 25092047
http://www.connectzone.in
Quadrant Televentures (formerly known as HFCL Infotel) operates under a Unified Access
Service Licence (UASL) in Punjab using the brand name Connect, and its PSTN/WiLL

82

network covers a combined 136 towns and cities in the circle. It launched CDMA WiLL
services in February 2001 after a rollout of 800MHz IS-95A infrastructure by Alcatel-Lucent,
and a CDMA2000 1x WiLL upgrade was provided by Huawei in the first quarter of 2005.
Limited mobility WiLL services are offered under the Connect Mobile banner, and since
the beginning of July 2007 all of Quadrants CDMA services have been classified as wireless
'WLL-M' and not fixed-wireless 'WLL-F' in line with regulatory norms.
In July 2006 meanwhile Quadrant gained regulatory approval to offer GSM mobile services
across Punjab under its UASL, although no formal decision was issued. Permission was,
however, confirmed by the Department of Telecommunications (DoT) in January 2008,
although the telco was told it would need to wait for an allocation of GSM-1800 frequencies
to inaugurate commercial services. With little more announced regarding the matter, in
March 2010 Quadrant revealed that it had made GSM-based services available to customers
in Punjab via a brand-sharing agreement with Videocon Telecommunications. Quadrant
subscribers looking to sign up for the service are directed to Videocon, but the exact nature
of the agreement between the two companies remains unclear.
As at end-March 2014 Quadrant Televentures was majority owned by Videocon Group via
Quadrant Enterprises (53.36%). Other shareholders include: IDBI bank (19.32%), Oriental
Bank of Commerce (6.37%), Mantu Housing Projects Ltd (3.43%), Masitia Capital Services
(2.13%), Life Insurance Corporation of India (1.76%) and Moolsons Holdings (1.35%).

Reliance Jio Infocomm Ltd (RJIL)

Maker Chambers IV
222 Nariman Point
Mumbai 400 021
India
Tel. +91 22 2278 50000
Fax +91 22 2278 5185
http://www.ril.com
Reliance Jio Infocomm Ltd (RJIL) is the telecoms start-up of Mukesh Ambanis Reliance
Industries Ltd (RIL). RIL was formed on the separation of Reliance Industries Group in 2005.
Following the death of Reliance founder Dhirubhai Ambani in 2002, his two sons Mukesh
and Anil fell out over the management and future of the group and under the terms of a
deal brokered by their mother, the group was split between the two; Anil took control of the
groups telecommunications, electricity and financial services which were spun off to create
Reliance Anil Dhirubhai Ambani Group (which now controls Reliance Communications
[RCOM]). The remaining petrochemical and manufacturing assets were renamed RIL, under
Mukesh. RIL returned to the telecoms sector in 2010 though, after the two brothers agreed to
end the no-compete condition of their previous agreement, with RIL bidding for broadband
wireless access (BWA) spectrum through its wholly owned Infotel Broadband Services Ltd.
The cellco was the only company to secure pan-India BWA spectrum at the auction, paying
INR128.48 billion (USD2.74 billion) for its 22 concessions. The Infotel label was dropped
in favour of the Reliance Jio Infocomm moniker in January 2013. Subsequently, in October
that year the cellco received Unified Access Service Licences (UASLs) in all 22 of Indias
telecoms circles, effectively giving it permission to offer any telecom service, including
voice telephony. Continuing to lay the groundwork for its launch, in February 2014 Jio
purchased 1800MHz spectrum in 14 key areas. The cellco intends to use its 2300MHz
holdings for a pan-India Time Division Long Term Evolution (TD-LTE) network, whilst its
1800MHz frequencies will be used for an integrated Frequency Division (FD)-LTE platform
to boost in-building coverage.
Despite the success at the earlier auction, Reliance fell quiet until early 2013 when it
launched into a flurry of activity. In April that year RJIL signed an infrastructure sharing

83

deal with RCOM, a deal which commentators suggested was the first step towards a more
wide-ranging cooperation between the two providers. Indeed, RJIL has since signed further
deals with RCOM to hasten its rollout, with the first pact valued at INR12 billion and
granting it access to RCOMs 120,000km inter-city fibre network, while the latter similarly
gained access to fibre installed by RJIL. A second contract between the two Ambani-backed
companies followed in early June 2013, with the INR120 billion, 15-year deal granting Jio
access to some 45,000 RCOM towers, and again allowing RCOM use of any RJIL-installed
towers. More recently, in April 2014 the signing of a third reciprocal deal took place, through
which RJIL will utilise RCOMs intra-city fibre network, which at that date spanned more
than 500,000km and covered more than 300 cities. Subsequently, rumours emerged in midJune 2014 that the two companies were planning yet another agreement, under which RJIL
would utilise RCOMs 800MHz and 2100MHz spectrum; the former band in particular is of
interest to Jio, as it would improve the indoor coverage of its LTE networks.
More recently, in December 2014 Infocomm announced plans to launch 4G services in no
fewer than 800 cities across the country between April-June 2015. The carrier intends to offer
dongles and mobile Wi-Fi routers in the launch phase, giving users a more cost-effective way
of accessing 4G than via an expensive smartphone. Reliance Jio was initially expected to
launch 4G services in March. The company statement read: We are currently in the process
of conducting our service field trials across multiple towns and cities, as well as in-house.
During this period, we are introducing our services to small groups of people who will offer
us feedback, so that we can develop a robust service platform and then scale up our services.
It is understood that Reliance Jio will offer real-world speeds of between 16Mbps-18Mbps,
with peak burst speeds of up to 50Mbps. Further, the same report says that under phase two
of its launch, the operator is also looking to offer fibre-to-the-premises (FTTP) services at
speeds of up to 100Mbps.
Meanwhile, RJIL signed infrastructure deals with a number of other operators in an effort
to speed-up its launch of 4G services. To that end, in late April 2013 it agreed to lease data
capacity on Bharti Airtels i2i submarine cable system, which connects India to Singapore.
Jio noted that it will utilise a single fibre pair on the cable network, adding that it planned
to pursue other areas for cooperation and development with Airtel. A second deal was inked
between the duo in December 2013, through which each would gain access to the others
infrastructure, including fibre optic cable links, submarine cables, towers and broadband
services, as well as other such opportunities identified in the future. In its press release,
RJIL suggested that 2G, 3G and 4G roaming or the joint construction of infrastructure were
potential avenues for further cooperation. Whilst it was reported that RJIL had entered into
negotiations with independent tower firm Bharti Infratel regarding a potential deal as early
as April 2013, it was not until March the following year that an agreement was actually
signed, allowing RJIL to utilise the other companys tower assets. In the wake of its pact with
Infratel, Jios negotiations picked up speed, and it signed deals with four tower companies
in the following months. RJIL partnered with Viom Networks in March 2014, adding 42,000
towers to RJILs footprint, followed by American Tower Corporation (ATC) a month later,
which brought its 11,000 towers to the table, whilst agreements with Tower Vision (8,400
towers) and Ascend Telecom (4,500 towers) were signed in May and June, respectively.
Elsewhere, it was revealed in late April 2014 that Jio was near to closing a further deal,
this time with state-backed telco Bharat Sanchar Nigam Ltd (BSNL). According to a BSNL
official, the telco had offered Jio a bulk deal, granting the cellco a discount if it purchased
space on a certain number of towers, while in return leasing access to any towers built by
RJIL outside of BSNLs existing footprint.
Further bolstering its readiness for launch, Jio is part of a consortium of telcos planning
to rollout out an 8,00km submarine cable system linking Malaysia and Singapore to Oman
and the UAE, with branches to India and Sri Lanka. The Bay of Bengal Gateway (BBG)
will provide connectivity between South East Asia and the Middle East, as well as linking
to Europe, Africa and Far East Asia through interconnection with existing cable systems.
The consortium which also includes Telekom Malaysia, Vodafone Group, Oman

84

Telecommunications Company (Omantel), Etisalat Group and Dialog Axiata has signed
a turn-key contract with French-US vendor Alcatel-Lucent for the deployment of the 100G
cable system, which will have landing stations in Barka (Oman), Fujairah (UAE), Mumbai
and Chennai (India), Ratmalana (Sri Lanka), Penang (Malaysia) and Singapore. The BBG
is scheduled to begin commercial operation by end-2014. Alca-Lu will install cable and
repeaters and will also be responsible for project management, system design and
commissioning and marine operations.
Meanwhile, in terms of its own infrastructure, RJIL had installed approximately 11,000 base
stations by start of June 2014, with that number set to increase to 40,000 by the end of the
year. That same month, however, the cellco reported that it had run into difficulty acquiring
the requisite permissions for deploying its infrastructure in a number of areas, most notably
Mumbai. Aiming for a September 2014 launch, ahead of the May 2015 deadline stipulated by
its licences, RJIL is reportedly planning to begin operations in smaller, second tier cities such
as Coimbatore or Indore before expanding to the busier metro circles, although this has not
been confirmed by the cellco. Meanwhile, RJILs recruiting efforts have put its competitors
on the back foot; with Jio having said it aims to increase its employee count to 3,000 by
April 2015 from 700 a year earlier, the hiring spree is causing its rivals to improve the pay
packages of their senior officials, as the newcomer has offered a 20%-25% salary increase
for circle head-level positions.
Reliance Jio Infocomm is a wholly owned subsidiary of Reliance Industries Ltd (RIL).

Loop Mobile
127 Manmala Tank Road
Taikalwadi
Mahim
Mumbai, Maharashtra 400016
India
Tel. +91 80 6589080
Fax +91 80 6589054
http://www.loopmobile.in
Loop Mobile (formerly BPL Mobile) was established in 1995 by Indian company BPL
Communications, and initially offered commercial GSM services solely in the Mumbai
circle. A sister operator, BPL Mobile Cellular (BPL Cellular) launched in 1997 and operated
in Maharashtra, Tamil Nadu and Kerala.
Disagreements between its shareholders dogged the cellco almost since its inception, and in
December 2003 founding domestic firm BPL Group bought out its US-backed partner AT&T
Wireless as the latter looked to re-focus its efforts in its domestic market. Subsequent plans
to merge BPL Mobile and BPL Cellular floundered amidst court battles between shareholders
over the ownership and control of the two companies. In July 2005 Hutchison Essar (now
Vodafone India) agreed to buy controlling stakes in the two companies and the deal was
completed in January the following year. BPL Cellular was merged into Hutchison Essars
wireless business, but the Mumbai operations remained independent after a bitter dispute
between the two partners, Hong Kong-backed Hutchison Telecommunication International
Ltd (HTIL) and Indias Essar Group. The acrimony continued after the Hutchisons departure
from the joint venture, with new partner Vodafone attempting to block Essars plans for BPL
Mobile to acquire licences in the 21 circles where it was not active.
Vodafone had feared that smaller cellco would be in direct competition with the UK groups
main operation, Vodafone Essar (now Vodafone India), in violation of the terms of the
operators licence. A subsidiary, Loop Telecom was established, and went on to be awarded
concessions for 21 circles by the Department of Telecommunications (DoT) in January 2008.

85

Vodafones misgivings proved well placed in April 2011 when the DoT issued a show cause
notice to Loop Telecom, claiming that the Essar group had held more than a 10% stake in
the cellco when it had been awarded its licences: Indian anti-trust laws forbid a company
from owning more than 10% of two mobile operators. The DoT claimed in a statement that:
Essar Group under a corporate veil and its complex web of companies is indirectly holding
substantial equity in Loop Telecom as well as the Vodafone Essar Group of companies, which
had mobile permits for the 21 circles for which Loop had applied and obtained licences in
violation of the licence agreement. Essar refuted the accusations, claiming to have only held
a 1.5% stake in the company at the time although other statements from the company in late
2007 had admitted that Essars holding in BPL Mobile was as high as 9.9% and a subsequent
investigation from the Central Bureau of Investigation (CBI) accused Essar of creating a
complex corporate veil to mask its ownership and get around the 10% cap.
The matter was still under investigation when Loop Telecom, along with all other mobile
operators that received their licences in 2008, had its concessions revoked by an order from
the Supreme Court (see Wireless Key Legislation for details). In response, Loop announced
that it had no other option but to close down all operations outside of Mumbai (which came
under the remit of Loop Mobile and was unaffected by the licence revocation). At the time
of the announcement, Loop Telecom had launched in 13 circles but had only managed to
sign up a total of 6,172 subscribers, most of which (2,369) were in Kolkata, whilst Uttar
Pradesh West had seen the least success, with the cellco boasting just eight subscribers in
that region. Loop eventually closed down its networks outside of Mumbai by mid-May 2012,
having remained open for an additional three months to allow its users opportunity to port to
other providers.
Struggling to pay its debts in the wake of Loop Telecoms closure, Loop Mobiles owners
began looking for a buyer for the stricken cellco as early as October 2012, though it was
not until February 2014 that market leader Bharti Airtel agreed to take control of Loop.
In the interim, the operator was told by its creditors in October 2013 to sell off its assets
to meet its debt payments. Under the proposal, the cellco said it would sell its towers and
other real estate for around INR1.5 billion (USD24.48 million). Adding to the pressure on
Loop, in March 2013 the regulator confirmed that the cellcos Mumbai concession would
not be eligible for renewal when the licence expired early the following year. As such, Loop
would be required to repurchase its licence through via auction at a later date, if it wished to
continue operating. Given the collapse of its nationwide operation and growing pressure from
creditors, Loop was not in a position to compete for a licence in one of the nations most
competitive and lucrative circles. Bharti agreed to take control of Loop in February 2014,
offering INR7 billion for the cellco subject to regulatory approvals. Whilst Bharti will not
gain additional spectrum through the deal, the cellco is set to garner nearly three million
subscribers from the transaction, lifting it to the number one position in the Mumbai circle,
which has long been dominated by Vodafone. Adding to Loops woes, in early June 2014
Vodafone blocked all incoming calls from the cellco, claiming it was owed long overdue
interconnect fees from Loop, although it did specify how much it was due from its smaller
rival. The matter was quickly resolved, however, and Vodafone confirmed that it had agreed
a settlement with Loop, without disclosing details.
Mauritius-based Khaitan Holdings Group owns a majority stake in Loop Mobile via Loop
Mobile Holding (India) Ltd (LMHI); Khaitan took ownership control of the company in 2005.
The ownership of Loop has long been a complicated, multi-layered affair, a situation which
authorities argued was a deliberately established by former shareholder Essar Group to hide
the extent of its stake in the firm. In August 2013 the Central Bureau of Investigation (CBI)
accused Essar of creating a complex corporate veil to hide the extent of its holding and
thereby cheat the Department of Telecommunications (DoT).
Bharti Airtel announced in February 2014 that it had signed an agreement to take over Loop
for INR7 billion (USD118.05 million), subject to the usual regulatory approvals. The deal

86

stalled in May 2014, however, when Chinese vendor ZTE petitioned the high court to restrain
the transaction until the cellco paid USD25 million owed to the vendor. A spokesperson
for ZTE explained: It has come to our notice that Loop is entering into a deal to transfer
its operating assets to Bharti Airtel, without keeping us informed about this. To secure our
interests, we have moved an additional application to the high court for the recovery of the
dues. Loop Mobile and its now-defunct subsidiary Loop Telecom had both entered into
agreements with ZTE prior to the revocation of the latters concessions in early 2012.

87

Broadband
Market Commentary
Indias burgeoning broadband market has yet to meet the untapped demands of the nations
huge population, and at the end of March 2014 there were an estimated 15.26 million
broadband subscribers in the country. While this made it the tenth largest market in the
world after China, the US, Japan, Germany, France, the UK, Russia, South Korea and
Brazil it paled in comparison to the wireless sector, which boasted more than 900 million
subscribers at that date. Meanwhile, despite a huge unmet demand for broadband services,
the rate of growth has steadily decelerated, from nearly 80% in the year to end-2008 to
34% in 2010 and 12% in 2012, while a -0.3% year-on-year drop in accesses was actually
recorded in 2013. Consequently, household penetration remains low, at just under 6.0%, a
figure far below the average 31% for the region, though slightly ahead of other nations with a
similar GDP per capita. Somewhat skewing the statistics against India is the high proportion
of narrowband subscribers i.e. customers utilising a connection slower than 256kbps, and
not considered broadband users by TeleGeography. According to the Telecom Regulatory
Authority of Indias (TRAIs) most recent data, at the end of December 2013 there were
18.79 million internet subscribers of which 14.93 million utilised broadband speeds. The
remaining 3.86 million, around 20% of the total, were connected via sub-broadband speeds.
One of the problems facing internet service providers (ISPs) is the nations rural population,
with only around 30% of Indians living in urban areas. Making matters worse, the country
also has a high level of poverty although this has improved greatly in recent years, with
roughly with 22% of the population (25.7% in rural areas, 13.7% in urban) below the
poverty line in 2011-2012 (most recent data at end-June 2014) compared to 29.8% in
2009-2010 and 37.2% in 2004-2005. Nevertheless, many of those living within reach of
broadband networks remain locked out by costs. In the National Telecom Policy (NTP)
2012, the regulator described these two factors as causing a digital divide, as those
unable to access the internet are denied opportunities available to those with access. The
government has long sought to eliminate this divide, looking to drive broadband take-up
mainly through subsidised infrastructure rollouts backed by the Universal Service Obligation
Fund (USOF), which supports projects including the operation and maintenance of Village
Public Telephones (VPTs), the construction of mobile infrastructure and the provision of
broadband connectivity in rural areas. Further measures to increase broadband usage are on
the horizon, with the NTP 2012 looking to create an inclusive knowledge society through
the proliferation of affordable and high speed quality broadband services across the nation.
Describing broadband connectivity as a basic necessity, akin to education and health, the
NTP set the lofty goal of achieving 175 million broadband subscriptions by 2017 (more
than ten times its current figure) and 600 million by 2020. Furthermore, these accesses will
be at a minimum of 2Mbps, but ranging up to 100Mbps. With lacklustre take-up of fixed
broadband services, the TRAI has now begun to bundle mobile broadband services using 3G
and 4G technologies into its calculations to claim that there were 60.87 million broadband
subscribers as at March 2014.
In addition, to realise its lofty ambitions for broadband growth, the government intends to use
the USOF to enable fibre-optic deployment to all villages. The NTP 2012 sketches plans to
establish an institutional framework to coordinate with different government departments and
agencies for the installation and upkeep of fibre networks at the village level. One proposed
structure would see a National Optical Fibre Agency (NOFA) oversee the deployment of
a National Optical Fibre Network (NOFN), whilst State Optical Fibre Agencies (SOFAs)
would handle the project at a state level. Some progress has already been made, such as
the establishment of state-owned telco Bharat Broadband Network Ltd (BBNL), created

88

specifically to handle the construction of the NOFN. BBNL intends to utilise fibre optic
networks already installed by other state-backed companies Bharat Sanchar Nigam Ltd
(BSNL), Railtel and Powergrid, and install new lines to connect all 250,000 gram panchayats
(self-administered small rural towns or villages) in the country. The NOFN rollout is
expected to take around two years to complete and will cost INR200 billion (USD3.363
billion). BBNL will provide non-discriminatory access to all service providers. In midOctober 2012, BBNL launched pilot projects in three blocks across three different states
covering a total of 58 gram panchayats. The blocks in question are: Arian in Ajmer district
(Rajasthan), Parvada in Visakhapatnam (Andhra Pradesh) and Panisagar in North Tripura
district (Tripura). The project made further headway in February 2014, with BBNL securing
USOF assistance for the deployment and upkeep of a fibre-optic transport network capable of
providing 100Mbps of bandwidth to 250,000 Gram Panchayats (small villages/towns). The
agreement is valid for five years.
At end-March 2014 there were 143 licensed ISPs, of which 134 were active. Despite the
large number of operators, the market is dominated by the two state-owned telcos BSNL and
Mahanahar Telephone Nigam Ltd (MTNL). With approximately 10.0 million subscribers at
that date, BSNL accounted for 65.5% of the market, whilst MTNL held a share of 7.4 %
with around 1.13 million customers. Bharti Airtel was the largest privately owned company,
and second largest ISP overall, with 1.5 million subscribers (9.8% market share) at endMarch 2014. Meanwhile, Reliance Communications (RCOM) and Tata Teleservices each
represented less than 2% of the pie, with the remaining 14% of the market divided between
more than a hundred other ISPs. With no local loop unbundling (LLU) legislation in place,
the operators with the greatest infrastructure assets have had the greatest success in growing
their customer bases. BSNL has by far the largest footprint, with ADSL networks in more
than 700 cities, and is the main partner and beneficiary of USOF subsidies. Bhartis coverage
meanwhile is just under 100 cities, with last-mile WiMAX access for corporate customers in
a further 50. MTNL only operates in the Delhi and Mumbai metro circles, but has extensive
infrastructure in both cities.
DSL connections make up the majority of broadband subscriptions, with 12.73 million users
at end-March 2014, although this was down slightly from an estimate 12.76 million a year
earlier, as rival fixed platforms such as fibre and cable increased in popularity. Indeed, fibrebased subscriptions are estimated to have reached 1.12 million subscriptions, crossing the
one million user milestone in mid-2013, whilst cable access are estimated to have crossed
that threshold in Q1 2014, with 1.015 million at that date. The sparse distribution of the
population has discouraged cable operators from expanding beyond major cities, though
there are a number of small, metropolitan cablecos offering high speed services within the
largest cities. Fibre technology has, however, been adopted by the markets largest players
Bharti Airtel, BSNL and MTNL which have been able to deploy the systems without
having to set prices prohibitively high to cover their rollout costs. Meanwhile, a number
of telcos have attempted to utilise wireless technologies such as WiMAX to increase their
footprint whilst minimising costs, with mixed results. Whilst such systems have proved
effective at extending broadband services more quickly and to greater numbers than fixed
alternatives, they compete directly with mobile technologies such as W-CDMA, Long Term
Evolution (LTE) and CDMA2000 1x EV-DO. With the recent surge in popularity of mobile
data services, the WiMAX market has suffered, shrinking from a peak of more than 800,000
users in June 2012 to approximately 360,000 at end-March 2014.

89

Networks
Provider Name

Access

Technology

Bharat Sanchar Nigam Ltd (BSNL)

DSL

ADSL

Bharat Sanchar Nigam Ltd (BSNL)

DSL

ADSL2+

Bharat Sanchar Nigam Ltd (BSNL)

DSL

VDSL2

Bharat Sanchar Nigam Ltd (BSNL)

LAN/FTTx FTTH

Bharat Sanchar Nigam Ltd (BSNL)

WiMAX

802.16-2004

Bharat Sanchar Nigam Ltd (BSNL)

WiMAX

802.16e

Bharti Airtel

DSL

Bharti Airtel

DSL

Bharti Airtel

LAN/FTTx FTTH

Bharti Airtel

WiMAX

802.16-2004

Mahanagar Telephone Nigam Ltd

(MTNL)

DSL

Mahanagar Telephone Nigam Ltd

(MTNL)

Frequency Launch

Status Network Details

Jan 2005 Live

Jun-14: >700 towns/cities

Live

Jun-14: Unknown

Feb 2010 Live

Jun-14: Unknown

Feb 2010 Live

Jun-14: 97 cities across 16 circles

2500

Feb 2009 Live

Deployed under multiple franchise agreements

2500

Feb 2010 Live

Deployed under multiple franchise agreements

ADSL

Nov 2004 Live

Jun-14: 94 cities

VDSL2

Mar 2010 Live

Jun-14: Delhi, Mumbai, Pune and Haryana

Jun-14: Delhi, Mumbai, Pune

May 2007 Live

Jun-14: 143 cities; last-mile services for business

customers only

ADSL

Jan 2005 Live

Jun-14: Mumbai and Delhi

DSL

ADSL2+

2005

Live

Jun-14: Mumbai and Delhi

Mahanagar Telephone Nigam Ltd

(MTNL)

DSL

VDSL2

Dec 2009 Live

Jun-14: Delhi and Mumbai

Mahanagar Telephone Nigam Ltd

(MTNL)

LAN/FTTx FTTH

Apr 2011 Live

Jun-14: Mumbai and Delhi

Quadrant Televentures (formerly

HFCL Infotel)

DSL

2002

Jun-14: Punjab only

Quadrant Televentures (formerly

HFCL Infotel)

LAN/FTTx FTTH

Jun 2014 Live

Jun-14: Zirakpur and Chandigarh

Reliance Communications (RCOM)

Cable

Q2 2005

Jun-14: 44 cities, 1.1 million buildings/1.5 million lines

ADSL

Ethernet/LAN

3300

Live

Live

90

Provider Name

Access

Technology

Frequency Launch

Status Network Details

Reliance Communications (RCOM)

DSL

ADSL

Reliance Communications (RCOM)

WiMAX

802.16-2004

Sistema Shyam TeleServices

(SSTL, MTS India)

DSL

ADSL

Live

Jun-14: Rajasthan only

Siti Cable

Cable

HFC

Live

Sep-14: >100 cities

Siti Cable

Cable

HFC (DOCSIS 3.0)

Tata Communications

DSL

ADSL

Tata Communications

LAN/FTTx

Tata Communications

WiMAX

802.16-2004

3300

Mar 2005 Live

Jun-14: 44 cities

Jun 2007 Live

Jun-14: 'top ten cities', including Mumbai, Delhi,

Bangalore, Calcutta and Chennai

Sep 2014 Live

Live

Jun-14: Nationwide

Live

(corporate access)

May 2007 Live

Jun-14: 223 cities

Live

Jun-14: 19 circles

May 2009 Live

Jun-14: 19 circles

Tata Teleservices (TTSL, inc. TTML LAN/FTTx FTTH

and Tata DOCOMO)

2009

Jun-14: 19 circles

Tata Teleservices (TTSL, inc. TTML WiLL

and Tata DOCOMO)

Mar 2009 Live

Tata Teleservices (TTSL, inc. TTML DSL

and Tata DOCOMO)

ADSL

Tata Teleservices (TTSL, inc. TTML DSL

and Tata DOCOMO)

ADSL2+

CDMA2000 1xEV-DO

3300

Sep-14: Delhi and National Capital Region (NCR)

Live

Jun-14: 17 of 22 circles, including Mumbai, Punjab,

Rajasthan, Kerala, Gujarat and Delhi

91

Retail Subscribers Market Share by Provider

Sources: operators, TRAI

Market Share History

Sep
2013

Dec
2013

Mar
2014

Jun
2014

Sep
2014

Dec
2014

65.0%

66.9%

65.5%

64.3%

64.2%

63.4%

Bharti Airtel

9.4%

9.9%

9.8%

9.9%

9.6%

9.0%

Mahanagar Telephone Nigam Ltd (MTNL)

7.2%

7.0%

7.4%

7.6%

7.3%

7.2%

Reliance Communications (RCOM)

1.2%

1.2%

1.2%

1.2%

1.2%

1.2%

Tata Teleservices (TTSL, inc. TTML and

Tata DOCOMO)

0.8%

0.8%

0.8%

0.8%

0.8%

0.9%

Quadrant Televentures (formerly HFCL

Infotel)

0.8%

0.8%

0.8%

0.8%

0.8%

0.8%

Sistema Shyam TeleServices (SSTL, MTS

India)

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

Tata Communications

0.5%

Bharat Sanchar Nigam Ltd (BSNL)

92

Market Share History

Sources: operators, TRAI

Quarterly Subscribers by Operator

Sep
2013

Dec
2013

Mar 2014

Jun
2014

Sep
2014

Dec
2014

Bharat Sanchar Nigam Ltd

(BSNL)

9,978,782 9,990,000 10,000,000 9,900,000 9,980,000 9,980,000

Bharti Airtel

1,442,300 1,475,000

1,500,000 1,530,000 1,500,000 1,410,000

Mahanagar Telephone
Nigam Ltd (MTNL)

1,098,281 1,050,000

1,130,000 1,165,000 1,130,000 1,130,000

Quadrant Televentures
(formerly HFCL Infotel)

122,313

116,970

118,000

122,000

126,000

131,000

Reliance Communications
(RCOM)

177,064

180,000

179,000

181,000

184,000

188,000

Sistema Shyam
TeleServices (SSTL, MTS
India)

4,142

2,935

2,700

2,850

2,880

3,000

78,098

72,000

70,000

67,000

65,000

62,000

116,793

120,000

122,000

125,000

132,000

136,000

Tata Communications
Tata Teleservices (TTSL,
inc. TTML and Tata
DOCOMO)

93

Annual Country Subscriber Growth

Year

Total

Growth
(%)

H'hold Pen.
(%)

DSL

Cable

Fibre/
LAN WiMAX Other

2009

8,222,505

48.8

3.5

6,768,726

589,639

364,140 500,000

2010 10,989,091

33.6

4.6

9,556,000

774,000

631,000 660,000 47,000

2011 13,350,000

21.5

5.4 11,363,520

767,625

710,220 464,580 44,055

2012 14,980,000

12.2

6.0 12,706,036

784,952

972,202 465,878 50,932

2013 14,930,000

-0.3

5.8 12,523,000

895,000 1,060,000 400,000 52,000

2014 15,750,000

5.5

6.0 12,882,500 1,157,500 1,282,500 407,500 20,000

Quarterly Country Subscriber Growth

Period

Total

Growth (%)

DSL

Cable

Fibre/LAN

WiMAX

Other

Sep 2012

14,680,000

0.8 12,120,000

850,000

915,000

775,000 20,000

Dec 2012

14,980,000

2.0 12,706,036

784,952

972,202

465,878 50,932

Mar 2013

15,050,000

0.5 12,763,905

791,630

996,310

448,490 49,665

Jun 2013

15,105,000

0.4 12,800,000

798,000

1,016,000

440,000 51,000

Sep 2013

15,360,000

1.7 12,950,000

885,000

1,030,000

440,000 55,000

Dec 2013

14,930,000

-2.8 12,523,000

895,000

1,060,000

400,000 52,000

Mar 2014

15,260,000

2.2 12,725,000 1,015,000

1,120,000

360,000 40,000

Jun 2014

15,390,000

0.9 12,735,000 1,050,000

1,185,000

390,000 30,000

Sep 2014

15,550,000

1.0 12,800,000 1,110,000

1,237,000

385,000 18,000

Dec 2014

15,750,000

1.3 12,882,500 1,157,500

1,282,500

407,500 20,000

Subscriber Growth

94

Sources: operators

Dial-up Internet Users Growth

Sources: TRAI

95

Subscription Plans
Speed
Provider

Product
Cap/
Access Name
Downstream Upstream Limit

Set-up Fee

Monthly
Cost

Local
Date
Currency Observed

Mahanagar
Telephone
Nigam Ltd
(MTNL)

DSL

Unlimited 2Mbps
1050

768kbps

Speed
restricted
after
30GB

None stated

USD17.22

INR1,050.00 Jun-2014

Mahanagar
Telephone
Nigam Ltd
(MTNL)

DSL

VDSL
Power
1050

10Mbps

5Mbps

Speed
restricted
after
25GB

INR1000

USD17.22

INR1,050.00 Jun-2014

Mahanagar
Telephone
Nigam Ltd
(MTNL)

DSL

VDSL
Power
2350

10Mbps

5Mbps

Speed
restricted
after
150GB

INR1000

USD38.55

INR2,350.00 Jun-2014

Mahanagar
Telephone
Nigam Ltd
(MTNL)

LAN/
FTTx

Fibre
Thrill
1050

10Mbps

5Mbps

Speed
restricted
after
25GB

INR1500

USD17.22

INR1,050.00 Jun-2014

Mahanagar
Telephone
Nigam Ltd
(MTNL)

LAN/
FTTx

Fibre
Thrill
4000

50Mbps

10Mbps

Speed
restricted
after
250GB

INR1500

USD65.62

INR4,000.00 Jun-2014

Mahanagar
Telephone
Nigam Ltd
(MTNL)

LAN/
FTTx

Fibre
10Mbps
Unlimited
10M

5Mbps

Unlimited

INR1500 USD396.97 INR24,199.00 Jun-2014

Mahanagar
Telephone
Nigam Ltd
(MTNL)

LAN/
FTTx

Fibre
20Mbps
Unlimited
20M

10Mbps

Unlimited

INR1500 USD721.77 INR43,999.00 Jun-2014

96

Speed
Provider

Product
Cap/
Access Name
Downstream Upstream Limit

Set-up Fee

Monthly
Cost

Local
Date
Currency Observed

Reliance
DSL
Communications
(RCOM)

Thunder
599

1Mbps

Unlimited

INR599

USD9.83

INR599.00 Jun-2014

Reliance
DSL
Communications
(RCOM)

Thunder
699

2Mbps

Unlimited

INR599

USD11.47

INR699.00 Jun-2014

Reliance
DSL
Communications
(RCOM)

Thunder
899

4Mbps

Speed
restricted
to 1Mbps
after
20GB

INR599

USD14.75

INR899.00 Jun-2014

Reliance
DSL
Communications
(RCOM)

Thunder
1099

4Mbps

Unlimited

INR599

USD18.03

INR1,099.00 Jun-2014

Reliance
DSL
Communications
(RCOM)

Freedom 12Mbps
999

Speed
restricted
to 1Mbps
after
25GB

INR599

USD16.39

INR999.00 Jun-2014

Bharti Airtel

DSL

Super
Plus

3GB

None stated

USD13.11

INR799.00 Jun-2014

Bharti Airtel

DSL

VDSL 35 16Mbps

35GB

None stated

USD27.05

INR1,649.00 Jun-2014

Bharti Airtel

DSL

Electric
Plus

16Mbps

80GB

None stated

USD46.74

INR2,849.00 Jun-2014

Bharti Airtel

LAN/
FTTx

Fibernet
Plus

8Mbps

15GB

None stated

USD21.31

INR1,299.00 Jun-2014

Bharti Airtel

LAN/
FTTx

Fibernet
25

8Mbps

25GB

None stated

USD23.77

INR1,449.00 Jun-2014

Bharti Airtel

LAN/
FTTx

Fibernet
100

100Mbps

100GB

None stated

USD98.41

INR5,999.00 Jun-2014

2Mbps

97

Speed
Provider

Product
Cap/
Access Name
Downstream Upstream Limit

Set-up Fee

Monthly
Cost

Local
Date
Currency Observed

Tata
Teleservices
(TTSL, inc.
TTML and Tata
DOCOMO)

DSL

Limitless 1Mbps
1

512kbps

Unlimited

None stated

USD18.03

INR1,099.00 Jun-2014

Tata
Teleservices
(TTSL, inc.
TTML and Tata
DOCOMO)

DSL

Power 2

2Mbps

512kbps

10GB

None stated

USD11.47

INR699.00 Jun-2014

Tata
Teleservices
(TTSL, inc.
TTML and Tata
DOCOMO)

DSL

Power 5

5Mbps

1Mbps

20GB

None stated

USD19.67

INR1,199.00 Jun-2014

Tata
Teleservices
(TTSL, inc.
TTML and Tata
DOCOMO)

DSL

Limitless 5Mbps
5

512kbps

Unlimited

None stated

USD49.20

INR2,999.00 Jun-2014

Tata
Teleservices
(TTSL, inc.
TTML and Tata
DOCOMO)

DSL

Power
10

10Mbps

1Mbps

50GB

None stated

USD29.51

INR1,799.00 Jun-2014

Tata
Teleservices
(TTSL, inc.
TTML and Tata
DOCOMO)

LAN/
FTTx

Lightning 20Mbps
20

2Mbps

10GB

None stated

USD18.03

INR1,099.00 Jun-2014

Tata
Teleservices
(TTSL, inc.
TTML and Tata
DOCOMO)

LAN/
FTTx

Lightning 50Mbps
50

5Mbps

20GB

None stated

USD32.79

INR1,999.00 Jun-2014

98

Speed
Provider

Product
Cap/
Access Name
Downstream Upstream Limit

Monthly
Cost

Local
Date
Currency Observed

50GB

None stated

USD49.20

INR2,999.00 Jun-2014

Tata
Teleservices
(TTSL, inc.
TTML and Tata
DOCOMO)

LAN/
FTTx

Lightning 100Mbps
100

Quadrant
Televentures
(formerly HFCL
Infotel)

DSL

Jumbo
1199

4Mbps

15GB

None stated

USD19.67

INR1,199.00 Jun-2014

Quadrant
Televentures
(formerly HFCL
Infotel)

DSL

Quick
999

1Mbps

20GB

None stated

USD16.39

INR999.00 Jun-2014

Quadrant
Televentures
(formerly HFCL
Infotel)

DSL

Quick
999

1Mbps

20GB

None stated

USD16.39

INR999.00 Jun-2014

Quadrant
Televentures
(formerly HFCL
Infotel)

DSL

Wizz 999 2Mbps

10GB

None stated

USD16.39

INR999.00 Jun-2014

Quadrant
Televentures
(formerly HFCL
Infotel)

LAN/
FTTx

Zip 2199 20Mbps

20GB

INR550-INR999

USD36.07

INR2,199.00 Jun-2014

Quadrant
Televentures
(formerly HFCL
Infotel)

LAN/
FTTx

Zip 4999 100Mbps

50GB

INR550-INR999

USD82.01

INR4,999.00 Jun-2014

Quadrant
Televentures
(formerly HFCL
Infotel)

LAN/
FTTx

Zip1599

20GB

INR550-INR999

USD26.23

INR1,599.00 Jun-2014

10Mbps

5Mbps

Set-up Fee

99

Notes: Unlimited tariffs are typically subject to operator 'fair use' policies.

100

Main Players
Bharat Sanchar Nigam Ltd (BSNL)
Sanchar Bhavan
20 Ashoka Road
New Delhi 110001
India
Tel. +91 11 23730392
Fax +91 11 23353303
http://www.bsnl.co.in
State-owned Bharat Sanchar Nigam Ltd (BSNL) is India's dominant provider of fixed line
telephony services. It offers a growing portfolio of internet services, including dial-up,
ISDN, IP switched data network, leased lines and broadband. On top of its national internet
backbone, which has 427 Points of Presence (PoPs), it has built a multi-protocol convergent
IP backbone, christened the National Internet Backbone II (NIB-II), capable of delivering
triple-play voice, data and TV services at theoretical speeds of up to 8Mbps nationwide.
The Multi Protocol Label Switching (MPLS) based IP infrastructure comprises 24 core
routers connected with 2.5Gbps links interfacing with its national DWDM network. BSNL
provides internet services over basic PSTN, wireless in the local loop (WiLL) and ISDN lines
throughout the entire country except in Delhi and Mumbai, which are covered by its sister
company Mahanagar Telephone Nigam Ltd (MTNL).
BSNL entered the residential high speed internet market in January 2005, when it launched
pre- and post-paid ADSL services in Bangalore, Chennai, Hyderabad and Kolkata. Having
initially operated under the Sancharnet brand, narrowband services were renamed simply
BSNL Internet in October 2007, at which time the operator also rebranded its DSL services
from Data One to BSNL Broadband. Standard consumer DSL speeds currently reach a
maximum of 2Mbps 'where technically feasible', although faster speeds are now being rolled
out, (see below), whilst 8Mbps business DSL connections were added to its portfolio in
upgraded coverage areas in 2007.
Meanwhile, in July 2009 BSNL inked a deal with solutions provider Sterlite to roll out a
commercial fibre-to-the-home (FTTH) network. In a deal worth INR3.72 billion, Sterlite was
selected to deploy Gigabit Passive Optical Network (GPON) technology, and it agreed to
execute the contract within the 2010 financial year; on completion the new infrastructure
would be capable of providing services including high speed internet, IPTV and voiceover-internet protocol (VoIP) to around 500,000 subscribers. Subsequently, in February
2010 BSNL inaugurated commercial FTTH triple-play services in the Hyderabad Telecom
District of Andhra Pradesh, and the following month services were introduced in six districts
of Rajasthan: Jaipur, Jodhpur, Udaipur, Ajmer, Kota and Alwar. FTTH construction has
continued apace, and between April and May 2012 BSNL issued four tenders for work
on various fibre networks. By end-June 2014, FTTH services were available in 97 cities
across 16 circles; Andhra Pradesh (eleven cities), Bihar (three), Gujarat (eight), Haryana
(four), Himachal Pradesh (two), Karnataka (ten), Kerala (six), Kolkata (five), Madhya
Pradesh (nine), Maharashtra (eleven), Orissa (one), Punjab (one), Rajasthan (ten), Tamil
Nadu (seven), Uttar Pradesh East and West (nine).
February 2010 also saw BSNL announce the launch of what was at the time the countrys
fastest xDSL-based commercial internet service, offering downstream connection speeds of
up to 24Mbps using VDSL technology. Only customers living within 500 metres of an
enabled exchange are able to receive the top-end speeds, while those subscribers within one
kilometre of the node should be able to connect at speeds of up to 16Mbps.

101

Away from fixed line broadband services, BSNL has dabbled in wireless broadband
technologies, but with little success. It began trialling WiMAX technology in March 2006 in
six cities Bangalore, Chennai, Kolkata, Pune, Hyderabad and Ahmadabad before in 2007
unveiling a three-phase approach for a wider roll out. Under its plans it aimed to set up its
own infrastructure in rural areas ins six circles (phase I) before extending the networks to
urban locations (phase II). Phase III meanwhile would see the telco sell WiMAX services
via franchise agreements. BSNL was awarded 20MHz of spectrum in the 2.5GHz band in
August 2008, with the telco set to pay the same rate as its competitors once the spectrum
was auctioned off (see below). Under the first phase of its rollout, BSNL deployed WiMAX
infrastructure in Gujarat, Maharashtra, Karnataka, Andhra Pradesh, Tamil Nadu (including
Chennai) and Orissa. The telcos rollout in Andhra Pradesh, Gujarat and Maharashtra was
carried out in partnership with Soma Network Solutions through a franchise agreement.
BSNLs first commercial WiMAX service was actually launched in February 2009 in the
Gujarat circle, as part of a project sponsored by the Indian government to bring internet
services to under-served areas.
The programme quickly encountered problems, however, and in 2009 opposition politicians
accused BSNL of corruption, forcing the telco to restart a tender for franchise partners. The
second attempt was completed in January 2010, but later that year the DoT took issue with
BSNL, complaining that the provider had altered the terms of the franchise agreements. The
changes are very different from the EoI [expressions of interest] on the basis of which the
franchisees bid for the subsequent tender that came out, an unnamed DoT official noted,
adding, This is a public document and it is not correct that the changes were made in the final
agreements. The regulator objected to changes made to seven clauses in the original EoI that
was first issued in September 2009, with the most notable of these being that the franchisees
would be allowed a one year moratorium from paying spectrum charges after the agreement
was signed. The original EoI stated that annual spectrum charges would be recovered from
the franchisee at the rate of 4% of total revenue, but in the final agreement BSNL has
stipulated that spectrum charges would be recovered through equated monthly instalments
(EMI) calculated at an interest rate of 10.8% over a 15-year period. Further, under the new
terms, in addition to the EMI the annual spectrum charges (1% of annual revenues) were
to be deducted from the revenue as pass-through cost. Corruption allegations resurfaced
in February 2011, with BSNL facing accusations regarding the way it had granted shell
companies urban WiMAX licences under its franchise agreements. The four franchisees
in question Teracom, Take Solutions, Adishwar and Starnet Communications (formerly
Ampoules) were awarded spectrum on a revenue-sharing basis in January 2010 without
being charged any upfront fee, even though BSNL had paid an entry fee to the government
itself. It was claimed that the franchisees did not possess the necessary experience of
WiMAX operations, and some were said to have changed their technology partners after
the tender. The Comptroller & Auditor General of India (CAG) and the Central Vigilance
Commission (CVC) began investigating the matter in March 2011, and in February 2012 the
Central Bureau of Investigation (CBI) said it was registering a fresh case in connection with
the WiMAX franchise allocations. There had been no further developments regarding the
case as at end-June 2014.
Corruption was not the only problem affecting BSNLs WiMAX programme, however, with
the telco also dogged by financial difficulties. In June 2010 the completion of the broadband
wireless access (BWA) spectrum auction determined the price to be paid by BSNL for its
frequencies as INR83.14 billion on the basis of price-matching the winning bidders. Facing
a much higher than expected bill for its airwaves, the telco began threatening to drastically
scale back its rural WiMAX rollout if it did not receive additional help from the government.
The telco informed the state that it should be given additional funding totalling INR23.95
billion for the programme, failing which it would reduce the number of WiMAX base stations
it planned to construct from 7,863 to just 1,798. The PTO argued that additional monies were
required as result of the higher-than-expected price it had to pay for its wireless broadband
spectrum. Its complaints appeared to work, and in November 2010 it was reported that BSNL

102

would be handed an INR23.95 billion grant to allow it to complete its rollout of wireless
broadband services, although the government said it would only make the funds available on
a number of conditions, namely; that BSNL rework its estimates for its WiMAX initiative and
spread the costs of the project over a 20-year period; and that it also examine infrastructure
sharing deals with other operators with a view to lowering costs. Despite the government
assistance, however, in 2011 the telco offered to hand back the BWA spectrum Maharashtra,
Gujarat, Andhra Pradesh, Kolkata, Karnataka and Tamil Nadu circles, claiming that it had
been issued with non-standard spectrum that could not be put into use. The government
ultimately accepted the return of the spectrum, with plans to refund the operator INR67.25
billion for the relinquished frequencies green-lit by the cabinet in January 2014.
BSNL also provides pre-paid internet access cards, pre- and post-paid public Wi-Fi access,
co-location, web hosting and videoconferencing. It launched VPN over DSL connections for
corporate/public sector users on 1 May 2007, alongside a post-paid dial-up VPN service for
MPLS VPN customers.
BSNL launched a pilot IPTV service in Pune in August 2006 and soft-launched its 'Multiplay'
triple-play voice, broadband and TV service in the city three months later. Two months
behind schedule, in March 2007 it commercially launched Multiplay in Pune, with Chennai,
Kolkata and Bangalore the next cities lined up to be covered. Via a set-top box, Multiplay
users can access services including TV-over DSL, video-on-demand, telephony and high
speed internet access. In late December 2007 the telco met with broadcasters and content
owners/aggregators with the aim of sourcing a range of content for a wider launch of tripleplay services. In September 2008 it was reported that the BSNL was preparing to launch its
IPTV service in 98 cities, having agreed deals with five companies: Aksh Optifibre, Smart
Digivision Pvt, IOL Broadband, Times Broadband and Maharashtra Knowledge Company
(MKCL). Subsequently, on 1 January 2009 the operator announced that it had launched
IPTV nationwide, and said it would continue to expand both the areas where the service
was available, and the features on offer. Despite such claims, the service proved short-lived,
with BSNL discontinuing its IPTV offering in November 2011, saying that operation was
unviable; at that date the telco had signed up just 3,000 users in Chennai, of which only 500
were reportedly active.
Bharat Sanchar Nigam Ltd (BSNL) is wholly state owned.

Bharti Airtel
Bharti Crescent
1, Nelson Mandela Road
Vasant Kunj
New Delhi 110 070
India
Tel. +91 11 46666100
Fax +91 11 46666411
http://www.airtel.in
Bharti Airtel is India's largest private sector telecoms operator by subscribers, offering a
full range of fixed, wireless and internet services. Its internet and data services arm Bharti
Infotel was brought under the Airtel banner in March 2006 by domestic parent group Bharti
Enterprises. Meanwhile, its Telemedia Services division offers voice and broadband services
in 87 cities across 16 circles: Delhi, Mumbai, Kolkata, Tamil Nadu (including Chennai),
Madhya Pradesh, Andhra Pradesh, Haryana, Rajasthan, Karnataka, Kerala, Gujarat, Punjab,
Maharashtra, Uttar Pradesh (W), Uttar Pradesh (E) and West Bengal. Airtel's Corporates
unit provides integrated telecoms and data services for large companies and SMEs, and
its Carriers unit offers wholesale voice and data transmission over Airtels pan-India and
international infrastructure. The company's portfolio includes dial-up FTTx and DSL internet

103

access, VSAT, ISDN, VPNs, web hosting, e-business, managed data and internet services,
and data transmission including fibre-optic, MPLS, ATM and frame relay.
Airtel's domestic high speed fibre-optic network spanned 184,211km, at end-March 2014 (up
from 171,610km a year earlier), reaching all major centres in the country. By June 2014
Airtel had over 4,150 MPLS and SDH Points of Presence (PoPs) and over 1,700 Points of
Interface (PoIs) with the local exchanges in India. Bharti's international assets include the
3,200km Networki2i cable system linking Chennai with Tuas in Singapore, completed in
2002 under a joint venture with Singapore Telecom (SingTel, one of Bharti's shareholders);
in January 2007 Airtel took full ownership of Networki2i by buying SingTel's 49.99% stake
for USD55 million. Bharti also controls the Chennai landing station of the South East AsiaMiddle East-Western Europe 4 (SEA-ME-WE 4) undersea cable linking Europe and Asia, in
which it has invested around USD40 million. Airtel has also invested in the Asia-America
Gateway (AAG), India-Middle East-Western Europe (IMEWE), Europe India Gateway (EIG)
and the East Africa Submarine System (EASSy) cable systems. Further, the company has
terrestrial cable links to Nepal, Pakistan, Bhutan and China.
Airtel's commercial ADSL services were launched in November 2004, initially at downlink
speeds of up to 128kbps. Broadband is now available to both residential and corporate users
at downlink speeds of up to 16Mbps dependent on region, but more commonly between
512kbps and 4Mbps. In October 2007 Airtel claimed to be the first in India to offer 8Mbps
broadband, announcing in early January 2008 that there was guaranteed availability of 8Mbps
plans in selected areas of Delhi, Bangalore, Chennai, Pune (Maharashtra) and Kolkata. The
operator announced further speed upgrades in April 2009, introducing downlink rates of up to
16Mbps in Delhi, Chennai and Bangalore before introducing VDLS2-based services in March
the following year. The super-fast broadband service was launched in Delhi and Gurgaon,
with maximum downstream rates of up to 50Mbps.
Airtel also offers broadband wireless access (BWA) for providing the last mile connectivity
for internet access and MPLS-VPN only, and does not sell it as a standalone product; last
mile on BWA is provided between the customer premises and ISP/ MPLS PoP. In 2006 Israeli
WiMAX specialist Alvarion deployed Airtel's first WiMAX network across major Indian
cities for enterprise customers, and the operator announced it was aiming to roll out BWA in
phases. By June 2014 the number of cities covered had risen to 143, including Ahmadabad,
Mumbai, Pune, Hyderabad, Bangalore, Cochin, Trivendram and Kolkata. Airtel took part in
the governments long-delayed auction of BWA spectrum, which finally got underway in
May 2010, bagging frequencies in four circles Maharashtra, Karnataka, Kolkata and Punjab
for a total of INR33.14 billion (USD712.51 million). Commercial WiMAX services remain
unlikely, however, particularly in light of the March 2012 launch of Bhartis Time Division
Long Term Evolution (TD-LTE) network (see Wireless Operations for details).
Airtels Telemedia Services division took its current name in 4Q 2007, having been renamed
from Broadband & Telephone Services to reflect its growing focus on IPTV, DTH and new
media. Airtel began trials of triple-play voice, data and TV services in Gurgaon in 2006,
with tentative plans to roll out commercial services by the end of the year. However, despite
receiving 'favourable' feedback from trial participants, it was not until September 2007 that
selected UTStarcom to supply its RollingStream end-to-end IPTV solution on a commercial
basis. Airtel said it aimed to offer the new service bundle to customers in Gurgaon and other
areas of the National Capital Region (NCR) by the end of 2007, with a subsequent phased
rollout planned across eight additional regions. It was over a year behind schedule when,
in January 2009, it finally introduced commercial IPTV services under its 'Airtel Digital
Television Interactive' brand; the launch did though make it the first private player to offer
triple-play services. December 2010 saw coverage finally extended to Bangalore, following
which, in March 2011 Airtel appeared to change tack, announcing the launch of its overthe-top (OTT) Airtel Broadband TV, which offers 28 live TV channels. As at end-June
2014 Airtel offered IPTV and DTH via traditional set top boxes, with offerings including 400

104

channels, of which 19 are in high definition (HD). Airtels digital TV subscriber base totalled
9.012 million at end-March 2014, up from 8.100 million twelve months earlier.
As at end-December 2013 Bharti Airtel was owned by Bharti Telecom Ltd (43.57%), Pastel
Ltd (14.79%) and Indian Continent Investment Ltd (6.65%). Other shareholders include Life
Insurance of India (4.77%), Three Pillars Ltd (5.00%) and ICICI Prudential Life Insurance
Company (1.16%). Bharti Telecom is in turn owned by Bharti Enterprises, Pastel and
Vodafone Group, while Indian Continent Investment is a wholly-owned subsidiary of Bharti
Enterprises. Pastel meanwhile is a wholly-owned subsidiary of Singapore Telecom (SingTel);
SingTel has an indirect equity interest in Bharti Airtel of 32.34% as of end-2013.
In May 2013 Airtel agreed to issue 199.87 million new shares to the Qatar Foundation
Endowment (QFE), representing a 5% shareholding in the company, for a total consideration
of USD1.27 billion. Under the terms of the deal, QFE subscribed to 199,870,006 new shares
in Bharti Airtel at a price of INR340 (USD6.35) per share (these are currently held via Three
Pillars Ltd).
Airtel is listed on the National Stock Exchange of India (NSE) and the Bombay Stock
Exchange (BSE).

Mahanagar Telephone Nigam Ltd (MTNL)

5th Floor, Mahanagar Doorsanchar Sadan
9, CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +011 24310212
http://mtnlmumbai.in
http://mtnldelhi.in
Mahanagar Telephone Nigam Ltd (MTNL) is the state-run incumbent fixed line operator in
Delhi and Mumbai. It presides over a fully digital wireline PSTN and CDMA wireless in
the local loop (WiLL) network covering the two major cities and surrounding areas. MTNL
launched its first residential ADSL broadband services under the 'Triband' banner in early
2005. It has continued to cater to rising demand via network rollout contracts with Huawei
and a partnership of Alcatel-Lucent and Indian equipment vendor ITI, covering Delhi and
Mumbai, respectively. MTNL has deployed ADSL2+ technology, offering downlink speeds
between 2Mbps and 4Mbps.
In June 2006 MTNL revealed plans to launch a high speed wireless broadband pilot service
in Delhi and Mumbai. Subsequently, in August 2008 it was awarded 20MHz of 2.5GHz
spectrum, and a year later invited bids from global players to set up and run its WiMAX
operations in Mumbai and Delhi on a franchisee basis. MTNL said it expected the successful
bidders (one in each circle) to provide fully converged broadband data, voice and support
services, and the six-year contract was to be based on a revenue-sharing model subject
to review every two years. A closing date for accepting bids was set as 16 September
2009, but potential bidders swiftly complained about the terms of the tender, which they
claimed were restrictive as they permitted only system integrators (SIs) or original equipment
manufacturers (OEMs) to bid. MTNL scrapped its plans for WiMAX in 2011 and in 2013
the government considered proposals to refund the ailing telco for its spectrum as part of a
recovery package (see Wireline Operations). The government approved the refund in January
2014, agreeing to repay the telco INR14.049 billion (USD233.465 million) for the unused
airwaves.

105

MTNL has also banked on next generation services to ramp up broadband penetration and
it began testing IPTV services in Delhi in late 2005. In March 2006 it contracted Israeli
firm Optibase for the supply of its MGW 5100 systems to enable the operator to offer tripleplay voice, video and data services. That month it agreed a seven-year deal with domestic
vendor Time Broadband Services (TBS) to develop and install the content delivery systems
for IPTV services; Hewlett Packard was contracted as systems integrator. In July MTNL
began trialling IPTV in Mumbai, and tied up deals with broadcasters to provide content.
Commercial IPTV was launched on a limited basis in October 2006 in Mumbai, offering
a mix of free-to-air and pay-TV channels, as well as video-on-demand (VoD) content.
Subject to technical feasibility, IPTV was subsequently offered in selected areas across
both cities to MTNL's broadband subscribers, following the deployment of UTStarcom's
RollingStream end-to-end IPTV solution under a three-year contract signed in 2007. MTNL
also provides voice-over-internet protocol (VoIP) services to its broadband customers in
Mumbai and Delhi in association with domestic technology provider Aksh Optifibre, and
additional services include MPLS-based IP VPN facilities. In January 2008 MTNL launched
commercial triple-play packages Triband Combo Plans bundling DSL, IPTV and VoIP.
MTNL quietly cancelled its IPTV services in the second half of 2013, however, issuing
notices to its subscribers stating that the offer would be terminated on 31 August, after it
chose not to renew its licence following a dispute with an unnamed content provider. With
the cancellation of its IPTV offering, triple-play plans were also axed although double-play
packages, combining fixed line telephony and broadband services, remained available as at
end-June 2014.
November 2008 saw reports that MTNL was preparing to unveil its fibre-to-the-home
(FTTH) broadband and entertainment service, with plans to offer higher speeds and provide
newer services such as high definition (HD) video and TV channels. Whilst FTTH broadband
services were not commercially launched until 2011, MTNL boosted its broadband offerings
with a VDSL2 launch in December 2009. The telco offers Unlimited and Truly Unlimited
FTTH tariffs, the first of which gradually slows transfer speeds as download caps are
reached. Its basic Fibre Thrill 1050 plan, for example, offers a 10Mbps/5Mbps (down/
uplink) connection until the customer uses 25GB of data at which point the speeds is slowed
to 1Mbps/768kbps.
The Indian government holds a 56.25% stake in Mahanagar Telephone Nigam Ltd (MTNL),
with the remaining 43.75% in the hands of foreign institutional investors, banks, mutual
funds and individuals.

Reliance Communications (RCOM)

H Block, 1st Floor
Dhirubhai Ambani Knowledge City
Navi Mumbai 400 0710
India
Tel. +91 22 30386010
Fax +91 22 30376622
http://www.rcom.co.in
Reliance Communications Ltd (RCOM) is the holding company for the telecoms assets of
India's powerful Reliance Anil Dhirubhai Ambani Group. It is licensed to provide a full range
of fixed line services in 21 circles, and its wireline and broadband network currently covers
more than a million buildings in more than 50 cities across its licensed regions. Its domestic
infrastructure includes a 190,000km national fibre backbone, 44 intra-city access networks
based primarily on metro Ethernet LANs, wireless LMDS links in areas not currently offering
direct network access, WiMAX networks (see below), an MPLS data network with 180
integrated nodes, and a growing number of internet data centres.

106

Then known as Reliance Infocomm, the company launched Ethernet/LAN and DSL internet
services for corporate users in the first half of 2005. Dedicated connections are available
to SMEs at downstream speeds of up to 20Mbps, and large enterprises at scalable speeds
of up to 100Mbps. RCOM also provides a range of dial-up, leased line, VPN, IPLC and
videoconferencing services. RCOM's submarine cable arm is Reliance Globalcom, which
operates the Flag and Falcon global submarine cable systems. In April 2013 Globalcom
integrated the Hawk cable system linking France, Cyprus and Egypt with its global
network. In June 2014 it was announced that RCOMs subsea cable division was planning
to roll out a new link from Mumbai to Singapore in partnership with three other companies.
Of the USD200 million investment needed for the project, RCOM will provide USD40
million-USD45 million. RCOM scrapped an initial public offering (IPO) for Globalcom in
July 2012 due to unfavourable market conditions, saying that the sale had failed to attract
enough interest from investors. The telco had looked to raise around USD1 billion through
the offering, as part of efforts to cut its debt burden. The situation looked set to improve in
April 2013, when reports emerged claiming that RCOM was close to selling an 80% stake
in Globalcom to Bahrain Telecommunications Company (Batelco). Later that same month,
however, negotiations with Batelco broke down only for a consortium of private equity firms
led by Samena Capital to replace the Bahraini group. Despite reports that a deal would be
completed in May, Globalcom remained in RCOMs hands albeit under a rebranded identity
after the company changed its name to Global Cloud Xchange in March 2014 and in Q1
2014 RCOM confirmed that the unit was no longer for sale.
RCOM began marketing its residential DSL internet access services under the name
Reliance BroadNet in September 2005, and by the end of 2006 BroadNet was available in
around 30 cities, offering pre- and post-paid packages with downstream speeds of between
100kbps and 1Mbps. By June 2014 the number of cities covered by RCOMs fixed line
broadband services, which had since dropped the BroadNet moniker, stood at 44, a figure
unchanged in at least three years.
RCOM meanwhile launched commercial WiMAX services for residential users in Bangalore
in early June 2007, and a WiMAX service specifically for SMEs in Pune later that month;
Pune was selected as the citys IT market was renowned as the fastest growing in India,
whilst it also hosted the 'Pune Unwired' programme, involving city-wide deployment of WiFi/WiMAX infrastructure. Walking away from the May 2010 broadband wireless access
(BWA) auction empty-handed, RCOM was forced to rethink its expansion programme, and at
the time of writing (June 2014) its WiMAX operations remained limited to Mumbai, Delhi,
Bangalore, Kolkata, Chennai, Hyderabad, Pune, Ahmadabad, Baroda and Surat.
RCOM originally planned to launch IPTV services under the RiTV banner in early 2007, but
the rollout encountered a number of significant delays. Having tested software and services
in conjunction with Microsoft and Orbit Communications Company (OCC), it demonstrated
a TV-over-DSL service at a trade show in June 2006, announcing plans to offer video-ondemand (VoD), live broadcasts and gaming via a set-top box connected to its broadband
network. In November 2007 it then announced a commercial partnership to deliver IPTV
on Microsoft's Mediaroom software platform by fiscal-end March 2008, under a contract
estimated at USD500 million. Little progress was made, however, until January 2010, at
which date RCOM finally soft-launched the service in select areas of Mumbai, with a full
launch following in August. Meanwhile, July 2010 saw the revelation that RCOM had agreed
to acquire cable television distribution firm Digicable in an all-stock deal. Following the
purchase RCOM said it would merge its retail broadband, IPTV and satellite direct-to-home
(DTH) services with Digicable, which at the time of the deal was one of Indias largest cable
television providers, with the combined entity to be renamed as Reliance DigiCom and worth
an approximate USD1 billion. Despite suggestions that the new unit could be operational by
December 2010, at June 2014 RCOMs TV offerings were still divided into Reliance Digital
TV and Reliance IPTV. At end-March 2014 RCOM claimed to have 4.8 million digital TV
customers, or 8% of the DTH market.

107

Reliance Communications Ltd is 67.86%-owned by India's Reliance Anil Dhirubhai Ambani

Group. The remainder is distributed, including 7.25% held by the Life Insurance Corporation
of India as of end-March 2013.

Tata Communications
Plot #C-21 and #C-36 Block G
Bandra Kurla Complex
Bandra (East)
Mumbai 400098
India
Tel. +91 22 66578765
http://www.tatacommunications.com
Tata Communications Limited (formerly Videsh Sanchar Nigam Limited, VSNL) is India's
former monopoly international telecoms carrier, and was handed concessions for domestic
long-distance carrier services and nationwide internet service provider (ISP) services as
recompense for losing its exclusivity in April 2002. Primarily catering to corporate and
SME customers, Tata Communications also provides wholesale internet access to numerous
residential ISPs including Tata Group sister companies Tata Teleservices (TTSL) and Tata
Teleservices (Maharashtra, TTML). The company lists among its Global Data and Managed
Services (GDMS): international/national private leased circuits (IPLCs/NPLCs), internet
lease line circuits, dedicated internet access, frame relay, ATM, data centre, global VPN,
global and pan-India Ethernet, voice-over-internet protocol (VoIP) and web conferencing. Its
carrier services meanwhile feature IP transit and global transmission utilising infrastructure
managed by sister company Tata Global Network (TGN) and consisting of 210,000km of
terrestrial and submarine fibre-optic cable connecting 240 countries. SME end-users have
access to broadband via dial-up, Ethernet, DSL, WiMAX (802.16d), leased lines and Wi-Fi.
In June 2006 Tata contracted Alcatel to expand its optical multi-service network in a USD20
million deal. The project supported the launch of new broadband and Ethernet applications
in the states of Bihar, Haryana, Himachal Pradesh, Kerala, Madhya Pradesh, Orissa, Punjab,
Rajasthan, Uttar Pradesh and West Bengal. It boosted its ISP business with the purchase
of rivals DishnetDSL in 2004, and Direct Internet along with its wholly owned subsidiary
Primus Telecommunications India Ltd (PTIL), in 2006; the bill for both companies, which
have since been merged into the group, came to INR2.45 billion (USD77 million).
Tata launched what it claimed to be India's first commercial WiMAX service for enterprise
customers in Bangalore in May 2007. It subsequently unveiled plans which it estimated
would cost between USD500 million and USD1.1 billion for the rollout of WiMAX services
for businesses and residential users in 35 main cities including all state capitals, and a total
of 120 towns and cities, over a two-to-three-year period. After Bangalore, it began rolling
out WiMAX infrastructure for corporates in Mumbai, Delhi and Hyderabad. In March 2008
Tata announced a tie-up with Telsima of the US to procure WiMAX equipment, and later
that same month it rolled out a fixed WiMAX network operating in the 3.3GHz spectrum
band in ten cities: Bangalore, Delhi, Mumbai, Pune, Bangalore, Chennai, Hyderabad, Cochin,
Chandigarh and Kolkata. The company had previously said that it expected a WiMAX
CAPEX outlay of USD500 million for the three years from 2009, and a significant portion of
that was set aside for spending on acquiring BWA spectrum that the state revealed it would
offer in the first half of 2010. However, following the sale, which took place between May
and June 2010, the telco had failed to win any new frequencies. Tata said in the aftermath of
the sale that, having ultimately sought to procure pan-India spectrum, bids swiftly exceeded
business cases by a large margin, a factor which in turn prompted it to exit the sale process
when no viable package remained available.

108

Tata Communications reported a net profit of INR1.01 billion for its fiscal year to 31
March 2014, reversing a net loss of INR6.23 billion in 2012/13 and representing its first
consolidated annual net profit for five years. Annual core business revenues reached
INR174.51 billion, up 13.9% year-on-year, with the growth attributed to strong demand
from global enterprise customers for Ethernet, VPN solutions and a host of managed
services. Results for the fourth quarter were less positive, with net loss widening from
INR52 million in 4Q 2013 to INR1.23 billion, though core business revenue did grow 16.4%
to INR45.79 billion.
Tata Communications Limited (formerly Videsh Sanchar Nigam Limited, VSNL) is owned
by multinational, multi-sector giant Tata Group and its subsidiaries (50.09%), and the
Government of India (26.12%), with the remainder divided between individual shareholders,
banks and financial institutions. The company is listed on the Bombay Stock Exchange (BSE)
and the National Stock Exchange of India (NSE), and its American Depositary Receipts
(ADRs) are listed on the New York Stock Exchange.

Tata Teleservices (TTSL, inc. TTML and Tata DOCOMO)

DLF Square
11 Floor M-Block
Jacaranda Marg
Gurgaon 122002
India
Tel. +91 124 2560500
Fax +91 124 2560619
http://www.tatateleservices.com
Tata Teleservices (TTSL) and Tata Teleservices Maharashtra (TTML) are the main retail
communications businesses of Indian industrial conglomerate the Tata Group. A third brand,
Tata DOCOMO was launched in mid-2009 following a partnership between Tata and Japans
NTT DOCOMO. Tata continues to use its Indicom moniker in Delhi and National Capital
Region (NCR) areas, whilst other operations come under the DOCOMO banner.
In March 2009 TTML unveiled its Digital Mumbai project aimed at developing broadband
services, which included the launch of products such as its fixed broadband Power
Launcher connection, which offers high speed connectivity with data transmission speeds
of up to 100Mbps. In May 2009 TTSL announced the launch of its own ADSL2+ services,
offering download speeds of up to 18Mbps under the Photon Pro banner. Simplifying its
portfolio, in late-2011/early-2012 the Photon brand was dropped from fixed broadband
packages, and is now used exclusively for mobile broadband packages. The telcos fibre-tothe-home (FTTH) network has since expanded and the TTSL now offers download speeds
of up to 100Mbps in limited areas of several circles under its Lightning tariffs. TTML
also offers ADSL services reaching speeds up to 10Mbps under its Power plans, whilst
Limitless unlimited download tariffs cap speeds at 5Mbps.
TTSL has also looked to drive up data use by increasing its portfolio of value added services
(VAS) with music applications, Dive-In a range of services featuring gaming, sports, and
news and the Tata Zone portal.
Tata Teleservices (TTSL) is majority owned by the Tata Group, whilst Japanese giant
NTT DOCOMO holds 26.5% and state-owned Singaporean investment company Temasek
Holdings has a minority stake. In early 2014 DOCOMO confirmed its intention to sell its
stake, giving Tata until June that year to either find an alternative buyer for the shares, or to
buy out the Japanese company itself.

109

Quadrant Televentures (formerly HFCL Infotel)

8 Commercial Complex
Masjid Moth
Greate Kailash-11
New Delhi 110048
India
Tel. +91 17 25090000
Fax +91 17 25092047
http://www.connectzone.in
Quadrant Televentures, which offers services under the Connect Broadband moniker, holds
a Unified Access Service Licence (UASL) covering Punjab and launched the region's first
broadband services for businesses in 2002. A full commercial launch of consumer ADSL
followed in October 2005. It provides a portfolio of data and internet services across the
circle, including DSL, leased lines, ISDN, VPN, Centrex, web hosting, videoconferencing
and server co-location. In its March 2011 annual report the company said it had entered into
an infrastructure sharing agreement with other, non-specified companies to provide 7,814km
of dark fibre for a period of 15 years (the start date of the agreement was not given).
In June 2014 the telco announced that it had launched fibre-to-the-home (FTTH) networks in
Zirakpur and Chandigarh, offering customers access to download speeds of up to 100Mbps.
Its fibre tariffs range in price from INR799 (USD17.19) per month for a 1Mbps connection
with a 10GB download cap to INR4,999 for 50GB of data usage at 100Mbps.
In October 2005 the telco rolled out a trial triple-play voice, video and data service in
Chandigarh and Mohali, with a view to launching commercial IPTV as part of a tripleplay package in 2007. Having inked a deal with Smart Broadband Services in August 2008,
which would see Quadrant use Smart's infrastructure to launch IPTV services, the operator
said it hoped to sign up 20,000 subscribers within the first phase of operations. Quadrant
subsequently claimed it would roll out the IPTV service within three months, but despite this
at June 2014 the IPTV launch had still yet to take place; in its stead the telco offers an overthe-top service, dubbed Connect Live TV, providing TV and video-on-demand (VOD) via its
website.
In January 2015 Quadrant purchased a pan-India ISP licence, revealing plans to invest over
INR3.4 billion over the following year to expand services to the three other circle where
parent company Videocon provides mobile services. Videocons CEO Arvind Bali explained:
We are already [the] broadband service market leader in Punjab. We have plans to roll
out internet services first in service area[s] where are operating, starting with Haryana, then
Gujarat, Madhya Pradesh and, Chattisgarh because we have a lot of synergies in terms of
infrastructure and manpower After these states we will pick each circle one by one, and
start rolling out internet services [elsewhere]. The official also noted that the broadband
infrastructure would support its 4G plans, allowing it use Wi-Fi hotspots to offload data
traffic from its 4G network.
As at end-March 2014 Quadrant Televentures was majority owned by Videocon Group via
Quadrant Enterprises (53.36%). Other shareholders include: IDBI bank (19.32%), Oriental
Bank of Commerce (6.37%), Mantu Housing Projects Ltd (3.43%), Masitia Capital Services
(2.13%), Life Insurance Corporation of India (1.76%) and Moolsons Holdings (1.35%).

Sistema Shyam TeleServices (SSTL, MTS India)

334 Udyog Vihar
Phase-IV

110

Gurgaon, Haryana 122001

India
Tel. +91 124 4615899
http://www.mtsindia.in
Shyam Internet Services is a wholly-owned subsidiary of Sistema Shyam TeleServices
(SSTL) and offers internet access via dial-up, ISDN, fixed wireless access (FWA) and ADSL.
At the end of March 2014 Shyam Internet Services had around 2,700 DSL customers in
Rajasthan. Shyams ADSL services offer downlink speeds of up to 8Mbps, although no prices
were available at the time of writing (June 2014).
In August 2009 the Department of Telecommunications (DoT) reportedly called on SSTL to
seek approval on behalf of Shyam Internet Services relating to Russian company Sistemas
stake in it, after suggestions that the internet service provider (ISP) had violated foreign
investment norms. The development followed claims that the internet unit never received
the mandatory approval from the Foreign Investment Promotion Board (FIPB) after Sistema
increased its stake in SSTL to 74%. The issue came to light after Shyam Internet applied
for approval from the DoT to offer pan-India services; it is currently limited to operating in
Rajasthan. The proposals were denied by the regulator on the grounds that Shyam Internet
did not have the required FIPB clearance. It was suggested that SSTL could face a financial
penalty for its failure to obtain the necessary clearances for Shyam Internet Services,
although the telco was expected to argue that it assumed, having gained its own approval
for Sistemas stake hike, all of its wholly owned subsidiaries were covered under the ruling.
More recently, in May 2014 Sistema applied to increase the level of foreign direct investment
(FDI) in Shyam Internet Services beyond 74%, only for this proposal to be rejected on the
basis that the stake increase had been structured as a foreign debt deal rather than FDI.
Sistema Shyam TeleServices (SSTL) is owned by Russian services conglomerate AFK
Sistema (56.68%), Indian industrial firm Shyam Group (24.00%), the Russian Federation
(17.14%) and others (2.18%).
In July 2013 the government passed legislation allowing 100% foreign direct investment
(FDI) in telecoms operators, although any deal which raises FDI above 74% must be
approved by the Foreign Investment Promotion Board (FIPB). In May 2014 Sistema applied
to the FIPB for approval to increase overseas ownership in SSTL above the 74% threshold,
but was denied the following month. According to the Department of Telecommunications
(DoT), the proposals had been rejected as the suggested stake increase had been structured as
an overseas debt deal rather than FDI.

Siti Cable
135 Continental Building
Annie Besant Road
Worli
Mumbai 400 018
India
Tel. +022 66971234
Fax +033 24900302
http://www.siticable.com
Siti Cable Networks was originally part of Zee Telefilms Ltd (ZTL), which began cable
TV operations in June 1994. In March 2006 ZTL was demerged into four separate firms
with the companys cable assets and CATV operations being spun off to Wire and Wireless
India, itself subsequently renamed Siti Cable Network Ltd in September 2012. The cablecos
network covers over 100 cities in 14 operating areas and consists of 56 analogue and 14
digital head ends, with a hybrid fibre-coaxial (HFC) network spanning more than12,000km.

111

Siti provides analogue and digital cable TV as well as broadband, although the last of these is
only available in the West Bengal and Delhi (including the National Capital Region [NCR])
areas. The operator upgraded its network in Delhi and NCR with DOCSIS 3.0 technology
in Q3 2014, boosting potential downlink speeds to 100Mbps. Siti went on to announced
in November that it had enlisted Cisco to deploy the upgrade in other cities. Broadband
packages range from 5Mbps to 100Mbps, with data caps of 15GB-100GB and prices between
INR599 (USD9.73) and INR3,699 per month. Customers that exceed their data limit have
their transfer rate throttled to 512kbps.
Siti Cable Networks is part of the Essel Group and as at end-March 2014, its major
shareholders included: Direct Media Solutions (26.89%), Essel Media Ventures (11.28%),
Digital Satellite Holdings (9.90%), Bioscope Cinemas (6.37%) and Essel International
(6.14%).

112

Wireline
Market Commentary
Despite earlier efforts by the Department of Telecommunications (DoT) and the Telecoms
Regulatory Authority of India (TRAI) to increase household penetration, particularly in rural
areas, India has seen a steady decline in fixed line usage. The number of lines in operation
has fallen from a peak of 48.84 million in 2005, to 35.09 million at end-2010 and 28.89
million three years later. The initial decline is partly attributable to the 2007 reclassification
of wireless in the local loop (WiLL) and fixed wireless access (FWA) telephony as a
wireless service, but the slump has continued unabated in the six years since the change
was implemented. Fixed to wireless substitution has played perhaps the largest role in the
deterioration, aided in no small part by increasing competition in the wireless market. Price
wars following the introduction of a raft of new players in 2008 and in the wake of the mass
licence cancellation in February 2012 encouraged subscribers to switch to the cheaper,
more flexible and more readily available mobile services.
State-owned telco Bharat Sanchar Nigam Ltd (BSNL) represents the lions share of fixed
line subscribers, with 20.443 million connections at the end of March 2013. Consequently,
BSNL has also seen the largest drop in subscriptions, with net losses of more than two
million in the year to end-March 2013, having seen a decline of more than 2.5 million in
the previous year. Sister company Mahanagar Telephone Nigam Ltd (MTNL) meanwhile has
fared marginally better, and while it too has seen subscriber losses they have been far less
marked; in the year to March 2012 it lost just 6,240 net fixed voice subscribers, bringing
its total down to 3.458 million, while it actually increased customer numbers in the year to
March 2013, to 3.459 million. Of the privately held telcos, Bharti Airtel has had the greatest
success in the fixed voice sector, and even registered subscriber gains in the year to endMarch 2013, at which date the telco claimed 3.284 million users, compared to 3.270 million
a year earlier. Tata Teleservices (TTSL) also has a large presence in the fixed line market and
has similarly resisted the downward trend, registering subscriber growth; the telco claimed
1.504 million lines in service as at 31 March 2013, compared to 1.441 million and 1.269
million the previous two years.
The governments National Telecom Policy 1999 (NTP 1999) had a substantial impact on the
sector with its introduction of Unified Access Services Licences (UASLs), the first of which
were eventually distributed in November 2003. The strategy's ultimate goal was to create
a converged industry where operators could provide the full gamut of services across the
wireline, wireless, internet service provider (ISP), satellite and cable TV markets, with the
concessions looking to facilitate this by allowing operators to utilise the most cost effective
and viable technologies to provide communications services to India's booming population
across a diverse geographical land mass. The result has been an increasing number of private
companies utilising cellular technologies to provide limited mobility services via WiLL/
FWA methods alongside full mobile cellular services, enabling the rollout of 'fixed' services
for a fraction of the investment needed in copper and fibre-optic lines. The largest overall
providers of CDMA-based services are RCOM and TTSL, both of which have rolled out
extensive CDMA2000 1x infrastructure far eclipsing their own limited copper networks,
which are used to provide a full range of WiLL/FWA and cellular mobile services.
The increasing use of such services prompted a flurry of objections from GSM cellular
network operators upset by the regulator's decision to make all WiLL services exempt from
the country's controversial access deficit charge (ADC), introduced in May 2003 to subsidise
the unprofitable rural networks of BSNL. The argument pivoted on just how mobile CDMAbased services were licensed, and ran until the regulator reclassified FWA as either 'limited

113

mobility' or fully mobile, known as WLL-F and WLL-M respectively, with the latter
liable for the same ADCs as GSM cellular providers. Following the ADC ruling, Airtel
began leveraging its GSM-based cellular network for FWA, and it launched Airtel Mega (a
brand which has since been dropped in favour of offering services under the straight Airtel
moniker) in July 2006, offering a portfolio of pre- and post-paid GSM/GPRS-based services
with limited mobility in all 22 telecom circles. With the distinction between 'fixed-wireless'
and 'mobile' becoming ever more blurred, since the end of 2006 the TRAI has excluded
all FWA and/or CDMA-based services, whether WLL-F, WLL-M or otherwise, from its
fixed line tally. All CDMA and GSM subscribers are counted in the regulator's wireless
statistics, and the reports of private operators and the Association of Unified Telecom Service
Providers of India (AUSPI) have all followed suit since July 2007.

Networks
Provider Name

Local Access
Type

Licence(s)

Bharat Sanchar Nigam Ltd (BSNL)

Wireline

Local, Long-distance,
International

Bharat Sanchar Nigam Ltd (BSNL)

WiLL

Local, Long-distance,
International

Bharti Airtel

Wireline

Local, Long-distance,
International

Bharti Airtel

WiLL

Local, Long-distance,
International

Mahanagar Telephone Nigam Ltd (MTNL)

Wireline

Local, Long-distance

Mahanagar Telephone Nigam Ltd (MTNL)

WiLL

Local, Long-distance

Quadrant Televentures (formerly HFCL Infotel) Wireline

Local, Long-distance,
International

Quadrant Televentures (formerly HFCL Infotel) WiLL

Local, Long-distance,
International

Reliance Communications (RCOM)

Wireline

Local, Long-distance,
International

Reliance Communications (RCOM)

WiLL

Local, Long-distance,
International

Sistema Shyam TeleServices (SSTL, MTS

India)

Wireline

Local, Long-distance,
International

Sistema Shyam TeleServices (SSTL, MTS

India)

WiLL

Local, Long-distance,
International

Tata Communications

Wireline

Long-distance, International

Tata Teleservices (TTSL, inc. TTML and Tata

DOCOMO)

Wireline

Local, Long-distance,
International

Tata Teleservices (TTSL, inc. TTML and Tata

DOCOMO)

WiLL

Local, Long-distance,
International

114

Annual Statistics by Operator

Provider
Name

Type

Reporting
Period

Bharat Sanchar Local

March
Nigam Ltd
subscribers
(BSNL)
(PSTN)

2009

2010

2011

2012

2013

2014

29,346,431 27,830,560 25,224,905 22,467,732 20,443,107 18,488,147

Bharti Airtel

Total lines
(PSTN)

March

2,726,239

3,066,859

3,295,919

3,269,949

3,283,827

3,356,122

Mahanagar
Telephone
Nigam Ltd
(MTNL)

Total lines
(PSTN)

March

3,694,970

3,496,754

3,463,969

3,457,729

3,459,045

3,528,752

Quadrant
Televentures
(formerly HFCL
Infotel)

Local
March
subscribers
(PSTN)

162,217

173,407

189,900

200,432

187,302

Reliance
Local
March
Communications subscribers
(RCOM)
(PSTN)

1,108,564

1,177,412

1,234,191

1,269,750

1,241,631

Sistema Shyam Local

March
TeleServices
subscribers
(SSTL, MTS
(PSTN)
India)

129,274

49,416

39,724

46,659

51,357

55,213

Tata
Teleservices
(TTSL, inc.
TTML and Tata
DOCOMO)

918,680

1,162,276

1,269,685

1,441,370

1,504,458

1,549,648

Local
March
subscribers
(PSTN)

Notes: Most operators ceased separating WiLL and mobile customer figures by the end of
March 2008. After that date WiLL subscribers are included in wireless rather than wireline
totals.
Sources: AUSPI, TRAI, operators

Annual Country Mainlines Growth

PSTN
Lines

PSTN
Pen.

2009

37,960,000

16.3%

2010

35,090,000

14.6%

2011

32,690,000

13.3%

2012

30,790,000

12.3%

2013

28,890,000

11.3%

Year

Total (PSTN +
VoIP)

Total
Growth

Total
Pen.

VoIP
Subs

VoIP
Pen.

2014

115

Sources: TRAI

Mainline Growth

Notes: From 2006 TRAI no longer counts WLL-F in its fixed line tally; WLL-F counted in
TRAIs wireless total.
Sources: TRAI

Main Players
Bharat Sanchar Nigam Ltd (BSNL)
Sanchar Bhavan
20 Ashoka Road
New Delhi 110001
India
Tel. +91 11 23730392
Fax +91 11 23353303
http://www.bsnl.co.in
State-owned Bharat Sanchar Nigam Ltd (BSNL) is India's dominant provider of fixed line
telephony services and one of the country's leading wireless operators. The telco was created
in October 2000, the product of the merger of India's Department of Telecoms Services
(DTS) and Department of Telecoms Operators (DTO), though its origins date back to 1985
when the government split the Department of Posts and Telegraphs, creating the Department
of Telecommunications (DoT), which had both operational and regulatory functions. BSNL
was given responsibility for the provision of local fixed line telephony throughout India,
with the exception of Mumbai and Delhi, which were assigned to sister company Mahanagar
Telephone Nigam Ltd (MTNL) a year later. BSNL offers a comprehensive portfolio of
wireline services across 20 telecoms circles, including basic telephony, internet, ISDN, prepaid card telephony, IP switched data networks, managed leased lines and wireless in the
local loop (WiLL).
BSNL's domestic network consists of more than 37,885 digital exchanges, 686,644km of
optical fibre and a 50,430km microwave network connecting 602 districts, 7,330 towns and
cities and 580,000 villages. It has capacity for around 43.74 million traditional fixed line
voice connections, while its wireless in the local loop (WiLL) network can accommodate
some 8.83 million subscribers. At end-March 2014 BSNL had 18.49 million fixed line
voice subscribers, not including WiLL connections, down from 20.44 million a year earlier.
Additionally, as at 31 December 2013 BSNL had 582,340 Village Public Telephones (VPTs)

116

in service, the largest number deployed nationwide by any one operator and representing 98.8
% of the countrys total. BSNL's X.25 data network provides various data services aimed
at businesses with multiple locations, under the I-Net banner, while very small aperture
terminal (VSAT) satellite-based connections are offered under the BSNL VSAT brand since
October 2007, previously known as SkyOne; the operator had 13,803 VSAT customers at
end-December 2013.
BSNLs WiLL offerings are a vital part of the operator's remit to cover underserved rural
regions, but such services have also helped to reduce network congestion in urban areas.
CDMA IS-95A WiLL services were launched in November 2003 and rolled out to all of
BSNL's licensed regions. ZTE supplied a commercial CDMA2000 1x platform in March
2005, which has subsequently been rolled out across all of the telcos operating region.
In mid-2005 BSNL then began partnering private franchise companies in offering regional
WiLL services, initially in the Tamil Nadu circle. In January 2007 BSNL unveiled a new
project to expand the WiLL network across Uttar Pradesh (West), with an initial capacity
of 50,000 lines provided by a new switching centre in Ghazaiabad, and another exchange
in Moradabad with additional capacity of 80,000 connections promised. Further, in January
2008 it revealed plans to invest USD500 million to roll out fully mobile CDMA services in
its licensed circles alongside its GSM cellular network, but with little activity reported in
this area the telco soon pushed back its expected launch date of such services to March 2010.
Mobile CDMA services have since been launched, with BSNL offering WLL Full Mobility
tariffs, subject to technical feasibility, in all 20 of its operational areas.
In May 2005 BSNL signed bilateral agreements with six international carriers for the routing
of international long-distance (ILD) calls, launching commercial services directly to 23
countries in the second half of that year. It raised its international profile further that October
when it contracted Japanese vendor NEC to build the Bharat Lanka cable system, a joint
venture with Sri Lanka Telecom to provide a high speed backbone link between Tuticorin
in India and Mount Lavinia in Sri Lanka. The cable system was inaugurated a year later
and is connected to the pair's domestic infrastructure, providing international connectivity to
networks including SEA-ME-WE 3 and SEA-ME-WE 4, and multiple satellite connectivity.
As far back as September 2002 the government has considered abolishing the geographical
split between BSNL and MTNL to create a single company, claiming that a merger would
create synergies enabling the pair to compete more effectively in the newly liberalised
telecoms market. In 2007-2008 it was announced that the merger had been put on hold,
following which in March 2009 BSNL outlined plans to restructure its business to create
separate divisions for fixed, mobile and broadband services, in a bid to better compete with
its rivals. Whilst the restructure never took place, the prospect of a BSNL/MTNL tie up
resurfaced in February 2011, when the DoT noted: The structure of BSNL and MTNL make
it difficult for them to be accountable for their performance. [The] DoT should set up a
multi stakeholder committee to develop a restructuring plan for both firms. April 2011 saw
the merger plan receive approval from a government panel which said that the combination
would be beneficial for both parties. Despite the apparent progress, however, there has been
little progress and no further action had been taken by June 2014.
BSNL registered its first ever loss in the year to end-March 2010 and has seen steady decline
in the subsequent years. The telco posted net losses of INR18.23 billion in the 2009/2010
financial year, more than tripling to reach INR63.84 billion for the year ended 31 March
2012. BSNL has attributed its downward spiral to political interference in the companys
management preventing it from adapting to changes in the industry in comparison to nimblefooted private telcos. In April 2013 telecom minister Kapil Sibal called for the government
to intervene to rescue BSNL and MTNL, claiming that: Immediate action together with
financial support would be required to put these [operators] back on track. On the back
of such claims the government has established a committee to investigate potential means
of reviving the debt-laden operators. Wages are amongst the highest costs for both telcos,
with employee expenditure equivalent to 49% of BSNLs revenues in 2013 and far exceeding

117

MTNLs turnover at that date; by comparison the industry average stood at just 5%. Making
matters worse BSNLs trade union has hindered efforts to restructure the business, fearing
job losses. Some help has been forthcoming though, and in January 2014 the state approved
the decision to refund BSNL for the broadband wireless access spectrum (BWA) it had
returned previously. Further, whilst no bailout package had been finalised by June 2014, in
February that year the committee proposed that the government issue INR85 billion in soft
loans, with a token interest rate of 1% over a ten-year period, to help pay salaries. Private
operators have, however, opposed any aid to the state-backed providers, claiming that such
assistance would be discriminatory and anti-competitive.
Bharat Sanchar Nigam Ltd (BSNL) is wholly state owned.

Mahanagar Telephone Nigam Ltd (MTNL)

5th Floor, Mahanagar Doorsanchar Sadan
9, CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +011 24310212
http://mtnlmumbai.in
http://mtnldelhi.in
Mahanagar Telephone Nigam Ltd (MTNL) is the sister company of fellow state-run fixed
line incumbent Bharat Sanchar Nigam Ltd (BSNL). It was created in April 1986 to provide
local and long-distance services in the cities of Delhi and Mumbai, where it provides wireline
PSTN and CDMA-based fixed wireless access (FWA, or WiLL [wireless in the local loop])
telephony via 100% digital networks. The state had considered abolishing the geographical
split between the two operators as far back as September 2002, but more than a decade later,
such plans had yet to be realised (see BSNL Wireline operations for details).
After launching a Motorola-supplied CDMA network in May 1997 in Delhi, it was upgraded
with CDMA2000 1x technology in May 2003 by Huawei. MTNL originally used BSNL's
infrastructure for all its national long-distance (NLD) services, but in May 2006 it received a
licence to build out its own nationwide network, and has begun to migrate traffic to its own
infrastructure, currently limited to a backbone between Mumbai and Delhi. It also offers a
limited mobility (WLL-M) CDMA service, under the Garuda brand, although in the absence
of official data for the service customers signed up to the service are believed to be on the
decline, and far below its network capacity of 1.1 million lines. MTNLs network consists
of 576 wireline exchanges, as well as 19 mobile switching centres (twelve GSM and seven
CDMA), with a fixed line capacity of 5.342 million lines, a switching capacity of 6.05
million for GSM and 1.09 million for CDMA. As at end-March 2014, MTNL had signed up
3.529 million fixed line users, up from 3.459 million a year earlier and its highest rate since
March 2009 when lines in service total 3.695 million.
MTNL announced in January 2010 that it was introducing per-second billing for its fixed line
and Garuda WLL-M services in the Mumbai circle. Following the changes MTNL customers
were able to make local calls to the telcos network in both Delhi and Mumbai at a rate of
INR0.005 (USD0.00008) per second, with calls to other networks charged at INR0.01 per
second; the new billing methodology was extended to the operators Delhi-based subscribers
in February 2010.
More so than its sister company, MTNL has encountered significant financial difficulties in
recent years that have paralysed its development, causing it to fall further behind its privately
owned competitors. MTNL attempted to tackle the issue as early as 2006 with a range of
cost-cutting measures, including staffing reductions. In April that year it announced plans

118

to offer voluntary redundancy to 1,300 employees, having trimmed more than 1,800 other
staff in the preceding year. Initially it appeared that the cost cutting measures were having
the desired effect, with the company reporting an 8.9% rise in net profit for the 2007-08
fiscal year. Subsequent years have, however, seen the telco reported ever increasing losses,
with the exception of 2010/11, when its losses shrank slightly year-on-year. Staffing costs
remain a substantial barrier for MTNL and in the year to end-March 2013 MTNLs employee
expenses, including pension contributions, totalled INR49.013 billion, far exceeding its
INR34.287 billion revenues. In an effort to revive MTNL and its sister firm BSNL, the
DoT proposed to bail out the two companies, suggesting options for loans, financial aid,
restructuring the duos businesses and refunding the telcos for their unused broadband
wireless access (BWA) spectrum. One of the proposals suggested a pay cut for MTNL
staff, bringing their wages in line with those of BSNL from 2017; under the programme
the telco aims to return to profitability by 2017/18 by also reducing its debt burden. The
government accepted the proposals in September that year, and MTNLs unions approved
the measures the same month. MTNL faced growing criticism from the government in early
2014 though, with politicians attacking the operator for its poor quality of service (QoS)
record and its failure to achieve a number of targets, including fibre deployment and mobile
and broadband subscriber growth. Nevertheless, the government acquiesced to shouldering
the telcos pension payments, and in the year to end-March 2014 employee expenses were
nearly halved to INR26.15 billion, while revenues stood at INR33.917 billion. By alleviating
MTNLs expenses, the bailout package successfully cut the telcos operating losses from
INR44.262 billion in fiscal 2013 to INR23.04 billion. Meanwhile, in January 2014 the
government green-lit a refund for MTNLs BWA airwaves, agreeing to repay the telco
INR14.049 billion for the frequencies.
The Indian government holds a 56.25% stake in Mahanagar Telephone Nigam Ltd (MTNL),
with the remaining 43.75% in the hands of foreign institutional investors, banks, mutual
funds and individuals.

Bharti Airtel
Bharti Crescent
1, Nelson Mandela Road
Vasant Kunj
New Delhi 110 070
India
Tel. +91 11 46666100
Fax +91 11 46666411
http://www.airtel.in
Bharti Airtel is India's largest private sector full-service telecoms provider by total
customers. In March 2006 domestic parent group Bharti Enterprises merged its telecoms
businesses wireline operator Bharti Tele-Ventures, broadband provider Bharti Infotel
and wireless group Bharti Cellular under the flagship Bharti Airtel banner previously
employed by the group's mobile operations.
Airtel (then Tele-Ventures) was granted a 20-year local telephony licence in Madhya Pradesh
in June 1997 and became the first privately owned telco to enter the sector when it launched
a year later. It was also the first private sector operator to be licensed for both national
and international long-distance telephony (in 2001 and 2002, respectively), and has since
rolled out a national fibre-optic backbone which, at end-March 2014, spanned 184,211km and
comprised some 4,150 MPLS and SDH Points of Presence (PoP) and more than 1,700 Points
of Interface (PoI) with the local exchanges. It provides broadband and telephony services
in 87 cities across 16 circles: Delhi, Mumbai, Calcutta, Tamil Nadu (including Chennai),
Madhya Pradesh, Andhra Pradesh, Haryana, Rajasthan, Karnataka, Kerala, Gujarat, Punjab,
Maharashtra (including Goa), Uttar Pradesh (West), Uttar Pradesh (East) and West Bengal.

119

Airtel holds Unified Access Services Licences (UASL) for all circles except North East.
Having reported its first decline in fixed line subscriptions in the year ended 31 March 2012
accesses fell to 3.27 million from 3.30 million a year earlier the decline was reversed the
following year, with Bharti claiming 3.36 million fixed lines in service at end-March 2014.
Airtel's Telemedia Services consumer/small business division concentrates on offering
packages bundling high speed DSL internet access and inclusive fixed voice telephony
minutes. The division changed its name in the last quarter of 2007 (from Broadband &
Telephone Services) to reflect a growing focus on IPTV, DTH and new media. While
Telemedia Services overarching strategy is to focus its local services on cities with high
revenue potential rather than widening coverage, in March 2009 Airtel announced it was to
build 4,000 service centres in rural areas in a bid to expand its presence in the country's rural
regions. It said that the project would focus on remote villages in the Maharashtra circle,
and Airtel announced that it had begun the rollout with the opening of the first centre at
Ausarikurd, near Pune, on 27 February 2009.
May 2009 saw Airtel announce a five-year deal worth USD500 million to outsource its
fixed line network to French-US vendor Alcatel-Lucent. Under the terms of the agreement
the two companies formed a joint venture to manage both Airtels broadband and fixed
line services in which the telco would hold a 26% stake; the remaining 74% is held by
the hardware vendor. The newly formed company is run by 4,000 Alca-Lu employees,
with Airtel understood to have transferred staff from its fixed line operations to the JV.
Commenting on the development Manoj Kohli, Airtels CEO, said: It will help us accelerate
performances as we migrate to Next Generation Networks for our broadband and telephone
customers, opening the door to advanced services and applications.
Airtel's Enterprise Services division meanwhile comprises the Corporates and Carriers units.
Corporates provides integrated telecoms and data services for large companies and SMEs,
including fixed and wireless voice, managed data and internet, VPNs, web hosting, ebusiness and satellite/VSAT links. Carriers offers wholesale voice and data transmission over
Bharti's pan-India and international infrastructure, including fibre-optic, MPLS, ATM and
frame relay.
In addition to copper wireline connections, Airtel's local access network uses wireless in the
local loop (WiLL) technology. Further, with its GSM mobile business boasting nationwide
coverage, the company utilised its cellular infrastructure to introduce GSM-based fixed
wireless access services in July 2006. The telco offers a low-budget portfolio of pre- and
post-paid GSM/GPRS based services with limited mobility (within the user's home city) in
all areas covered by it cellular network. Airtel originally launched WiLL services over a
Motorola-supplied CDMA IS-95A 800MHz network in 3Q 1997, but the service was rolled
out in Madhya Pradesh only. In October 2006 the Department of Telecommunications (DoT)
ordered Airtel to hand back its CDMA spectrum for reassignment under the state's frequency
allocation plan, an order which the cellco obeyed under duress, claiming that it was asked to
pay inflated licence fees to retain the frequencies. It opted to transfer its 20,000 WiLL users
in the region to its GSM platform and close the CDMA network. All Airtel's GSM users,
including fixed-wireless, are counted as part of its mobile customer base.
Bharti's international assets include the 3,200km i2i cable system linking Chennai with Tuas
in Singapore, completed in 2002 under a joint venture with Singapore Telecom (SingTel,
one of Bharti's shareholders); in January 2007 Airtel took full ownership of i2i by buying
SingTel's 49.99% stake for USD55 million. Bharti also controls the Chennai landing station
of the South East Asia-Middle East-Western Europe 4 (SEA-ME-WE 4) undersea cable
linking Europe and Asia, in which it has invested around USD40 million. Airtel has also
invested in the Asia-America Gateway (AAG), India-Middle East-Western Europe
(IMEWE), Europe India Gateway (EIG) and the East Africa Submarine System (EASSy)
cable systems. Further, the operator also has terrestrial cable links to Nepal, Pakistan, Bhutan
and China.

120

In July 2009 the DoT filed a proposal on behalf of the state for the sale of the latters
30% stake in Bharti Hexacom, one of Bhartis subsidiaries. The government holds a stake
in Hexacom through Telecom Consultants of India (TCIL), and Bharti Airtel currently runs
its operations in six states through the subsidiary. TCIL has tried to exit the operator once
before, in 2005-06, but the sale was halted after it claimed the INR2.63 billion (USD58.9
million) price offered by Bharti for its 30% stake was too low. It was claimed that the
governments decision to sell its stake was prompted by two factors; the decision by Bharti
not to list the subsidiary; and the refusal of Bharti group to issue annual dividend payments.
With the government having issued an in-principle approval for the stake sale in November
2010, five companies submitted technical bids, although only two companies Airtel itself
and an unnamed engineering and construction company actually submitted financial bids
in December 2010. The process dragged on however, prompting Airtel in March 2011
to announce that it had withdrawn its offer for the 30% stake, partly as a result of the
government seeking a premium over the INR18 billion base price set for the holding. The
plan was shelved in May that year, with TCIL citing insufficient interest. A subsequent
attempt to sell the holding was derailed after the government rejected the suggested reserve
price as too low. In May 2014 it was reported that TCIL was once again preparing to sell its
stake in Hexacom, although no further details were available as at end-June 2014.
As at end-December 2013 Bharti Airtel was owned by Bharti Telecom Ltd (43.57%), Pastel
Ltd (14.79%) and Indian Continent Investment Ltd (6.65%). Other shareholders include Life
Insurance of India (4.77%), Three Pillars Ltd (5.00%) and ICICI Prudential Life Insurance
Company (1.16%). Bharti Telecom is in turn owned by Bharti Enterprises, Pastel and
Vodafone Group, while Indian Continent Investment is a wholly-owned subsidiary of Bharti
Enterprises. Pastel meanwhile is a wholly-owned subsidiary of Singapore Telecom (SingTel);
SingTel has an indirect equity interest in Bharti Airtel of 32.34% as of end-2013.
In May 2013 Airtel agreed to issue 199.87 million new shares to the Qatar Foundation
Endowment (QFE), representing a 5% shareholding in the company, for a total consideration
of USD1.27 billion. Under the terms of the deal, QFE subscribed to 199,870,006 new shares
in Bharti Airtel at a price of INR340 (USD6.35) per share (these are currently held via Three
Pillars Ltd).
Airtel is listed on the National Stock Exchange of India (NSE) and the Bombay Stock
Exchange (BSE).

Tata Teleservices (TTSL, inc. TTML and Tata DOCOMO)

DLF Square
11 Floor M-Block
Jacaranda Marg
Gurgaon 122002
India
Tel. +91 124 2560500
Fax +91 124 2560619
http://www.tatateleservices.com
Tata Teleservices (TTSL) and Tata Teleservices Maharashtra (TTML) form the main retail
telecoms business of Indian industrial conglomerate the Tata Group. TTSL was licensed in
1997 and launched local telephony services in Andhra Pradesh in 1999, before expanding to
Gujarat, Delhi, Karnataka, Chennai and Tamil Nadu over the next three years. In December
2002 Tata then acquired a 70.83% stake in Maharashtra-based operator Hughes Tele.com,
renaming it TTML.
Whilst TTSL offers traditional fixed voice services over copper lines, the bulk of its
infrastructure is based on CDMA2000 1x technology, which it utilises to provide a portfolio

121

of fixed wireless access (FWA) and cellular mobile services, and in July 2007 Tata ceased
separating its wireless in the local loop (WiLL) and mobile customer figures; FWA
subscribers are now included in the companys wireless totals. It launched 1x services in
November 2002 over a WiLL/cellular network provided by Alcatel-Lucent and Motorola as
an upgrade to its CDMA IS-95A (WiLL-only) infrastructure rolled out by Alcatel-Lucent
in 1998. In October 2004 Tata Indicom relaunched its pre- and post-paid FWA services
under the brand name 'Walky Talky' (since renamed Tata Walky), introducing new features
such as internet access at speeds of up to 153kbps, SMS and e-mail. Tata deploys a
significant portion of its FWA infrastructure in urban areas, where demand is high for its
cheap packages, but it also utilises WiLL technology to comply with its universal service
obligation (USO), rolling out local services in rural regions of each circle where it has a
presence. In June 2006 Tata struck a deal with Chinese vendor ZTE for the deployment
of rural CDMA2000 1x infrastructure over a three-year period, and in January 2008 TTSL
received notification of approval from the Department of Telecommunications (DoT) for its
application for unified access service licences (UASL) covering the three circles it was not
licensed to operate in at that date: Jammu & Kashmir, Assam and North East.
Having extended its fixed line coverage to the six circles of Rajasthan (April 2007),
Himachal Pradesh (May 2007), Uttar Pradesh East (June), Uttar Pradesh West (July), West
Bengal and Orissa (both September), in November 2008 TTSL announced that it had
expanded its fixed-wireless infrastructure to the Assam circle, and had set aside INR1 billion
(USD20 million) for further expansion in the region. December 2008 saw Jammu & Kashmir
added to the operators area of operation, with Tata once again claiming it would spend
approximately INR1 billion in the region for its network rollout. By June 2014 the Tata FWA
network covered more than 450,000 towns and villages across all 22 of India's telecoms
circles. Bucking the overall downward trend, TTSL continues to register growth in its fixed
line subscriber base, although the rate of expansion has slowed in recent years. After adding
more than 170,000 new users in the year to end-March 2012, the telco has booked net
additions of 63,088 and 45,190 in the subsequent two years. At end-December 2013 (latest
available data at end-June 2014) Tata also had 3,953 village public telephones (VPTs) in
Maharashtra (2,595) and Andhra Pradesh (1,358).
Tata Teleservices (TTSL) is majority owned by the Tata Group, whilst Japanese giant
NTT DOCOMO holds 26.5% and state-owned Singaporean investment company Temasek
Holdings has a minority stake. In early 2014 DOCOMO confirmed its intention to sell its
stake, giving Tata until June that year to either find an alternative buyer for the shares, or to
buy out the Japanese company itself.

Reliance Communications (RCOM)

H Block, 1st Floor
Dhirubhai Ambani Knowledge City
Navi Mumbai 400 0710
India
Tel. +91 22 30386010
Fax +91 22 30376622
http://www.rcom.co.in
Reliance Communications Ltd (RCOM) was formed in December 2005 via the demerger
and vesting of the telecoms businesses of Reliance Industries Ltd. Its shares were floated
on the Bombay Stock Exchange (BSE) and National Stock Exchange of India (NSE) in
March 2006, and a listing on the Luxembourg exchange followed in August that year.
India's powerful Reliance Anil Dhirubhai Ambani Group established RCOM as a holding
company for its telecoms assets and, along with its wholly-owned subsidiaries, it holds all the
group's telecoms networks, facilities, licenses and properties, including a nationwide wireless
network comprising CDMA (reaching 20 of India's 22 telecoms circles) and GSM platforms

122

(covering all 22 circles), national and intra-city fibre-optic infrastructure, and the FLAG
and FALCON global submarine cable systems, as well as its Reliance World retail chain, a
number of internet data centres, and network operating centres.
Then known as Reliance Infocomm, the company launched fixed line services in 1997 in
the Gujarat circle. In July 2001 it won concessions to operate in a further 16 circles, and
in April 2002 expanded its business further by winning an international long-distance (ILD)
concession. Subsequently, in March 2003 it launched ILD services and the following month
completed the installation of a 60,000km national fibre-optic cable network, which it had
expanded to 190,000km by June 2014. It has more than 25,000km of ducted fibre-optic cables
installed in Indias larger cities, whilst its entire inter-city and metro fibre-optic backbone
network is deployed in a ring and mesh architecture and is MPLS enabled. The RCOM data
network has over 180 multiprotocol label switching (MPLS) integrated network nodes.
RCOM is now licensed to provide local, domestic and international long-distance (DLD and
ILD) fixed line services in 21 circles, all under Unified Access Service Licences (UASLs).
As at 31 March 2014 RCOM claimed to hold a 30% market share for ILD wholesale inbound
traffic, with over 2.5 million customers reportedly using its Global Call service. For the
three months ending 31 March 2014 total ILD minutes edged up by 1.1% quarter-on-quarter
to 4.995 billion, whilst total DLD minutes grew by 0.6% q-o-q to 14.886 billion. Wireline
telephony services, including ILD and DLD are grouped under RCOM's Global business
division.
RCOM also offers retail fixed line and fixed wireless access (FWA) services under the
'Reliance Hello' banner. Reliance Hello offers local, DLD and ILD fixed line telephony,
CDMA2000 1x-based FWA, analogue trunking, Centrex and ISDN services to residential
and corporate users. The launch of FWA services was delayed until August 2003, due to a
flurry of objections from GSM cellular network operators upset by the regulator's decision to
make the service exempt from the access deficit charge (ADC). RCOM's national expansion
strategy is based on converged wireline and wireless services, and its FWA customers have
access to pre- and post-paid services, as well as internet access at speeds of up to 144kbps
nationwide and 3.1Mbps in around 500 cities, and other value added services (VAS). Its fixed
line service, meanwhile, is marketed as Reliance Landline and offerings includes Caller ID,
Call Waiting and Call Waiting ID as standard.
Reliance Communications Ltd is 67.86%-owned by India's Reliance Anil Dhirubhai Ambani
Group. The remainder is distributed, including 7.25% held by the Life Insurance Corporation
of India as of end-March 2013.

Sistema Shyam TeleServices (SSTL, MTS India)

334 Udyog Vihar
Phase-IV
Gurgaon, Haryana 122001
India
Tel. +91 124 4615899
http://www.mtsindia.in
Sistema Shyam TeleServices (SSTL) then known as Telelink, received its original local
telephony licence on 4 March 1998, beginning trial services later that year, and it launched
commercial basic voice services under the Rainbow brand name in Jaipur on 30 June 2000.
It also offers limited mobility wireless in the local loop (WiLL) telephony, and provides
DECT services in Rajasthan's rural regions. As at 31 March 2014 SSTL had 55,213 lines in
service, an increase against the 51,357 reported a year earlier and 46,659 in March 2012. The
telco also operates 3,010 public village telephones (VPTs) at end-December 2013, unchanged
over the previous five years.

123

In February 2011 SSTLs application for a national long-distance (NLD) licence was
approved by the Foreign Investment Promotion Board (FIPB). Commenting on the
development a spokesperson for the telco noted: To remain competitive in the market in
terms of carriage cost and to also offer a world class service to its customers, acquiring a
national long-distance licence for a pan-India telecom company like SSTL assumes a lot of
significance.
Sistema Shyam TeleServices (SSTL) is owned by Russian services conglomerate AFK
Sistema (56.68%), Indian industrial firm Shyam Group (24.00%), the Russian Federation
(17.14%) and others (2.18%).
In July 2013 the government passed legislation allowing 100% foreign direct investment
(FDI) in telecoms operators, although any deal which raises FDI above 74% must be
approved by the Foreign Investment Promotion Board (FIPB). In May 2014 Sistema applied
to the FIPB for approval to increase overseas ownership in SSTL above the 74% threshold,
but was denied the following month. According to the Department of Telecommunications
(DoT), the proposals had been rejected as the suggested stake increase had been structured as
an overseas debt deal rather than FDI.

Tata Communications
Plot #C-21 and #C-36 Block G
Bandra Kurla Complex
Bandra (East)
Mumbai 400098
India
Tel. +91 22 66578765
http://www.tatacommunications.com
Tata Communications Limited (formerly Videsh Sanchar Nigam Limited, VSNL) was
incorporated as a state-owned enterprise in 1986, when it took over the reins of India's
monopoly international telecoms carrier from the Overseas Communication Service. The
government has since gradually reduced its holding to a minority stake, and the telco is
now controlled by Indian conglomerate the Tata Group, which took a majority stake in June
2002. It operates 15 international switching and transmission facilities at ten gateways in
Mumbai, Kolkata, Delhi, Chennai, Ernakulam, Gandhinagar, Jalandhar, Kanpur, Bangalore
and Hyderabad, each of which route international traffic to and from the domestic telecoms
network using a combination of satellite and undersea cable links. Its main international
cable landing stations are located at Chennai, Mumbai and Ernakulam. On 31 October 2007
a proposal to change the company's name from VSNL to Tata Communications Limited
was approved by its board of directors, and received shareholder approval the following
December.
Tata Communications owns and operates an international transmission network stretching
over 240,000 route kilometres with coverage of more than 240 countries and territories. It
is one of the world's largest providers of submarine cable capacity, and its global IP core
network has more than 400 points of presence (PoPs). Tata Communications' global customer
base included over 1,600 global carriers and service providers, 785 mobile operators, 50,000
SMEs and 190,000 broadband and internet subscribers and 500 Wi-Fi public hotspots at June
2014. Its infrastructure enables it to offer a range of services that include traditional TDM
voice, voice-over-internet protocol (VoIP), private leased circuits, IP VPN, internet access,
global Ethernet, data centre, co-location, managed network, managed services, managed
hosting, managed storage and other IP-related services.
Tata Communications lost its monopoly on international bandwidth services two years ahead
of schedule in April 2002, but the blow was softened slightly by the receipt of a free domestic

124

long-distance licence (DLD) and nationwide internet service provider (ISP) concession. The
telco, however, lost the business of state-run incumbents BSNL and MTNL, and was forced
to cut its international bandwidth tariffs by as much as 70% in some areas over the following
months to remain competitive. In the DLD sector Tata interconnects calls over its domestic
infrastructure between all fixed and mobile networks in the country. The telco has noted that
its DLD business has allowed it to lower costs by reducing the dependence on other operators
for domestic connectivity, but it lacks direct access to residential DLD and international
long-distance (ILD) telephony end-users, and blames its continued absence from the retail
long-distance fixed line voice market on India's failure to implement systems such as Carrier
Access Codes (CAC) supporting carrier selection services and Intelligent Network (IN)
systems supporting pre-paid calling cards across multiple carrier networks.
In order to reduce its dependence on ILD turnover Tata has looked to explore new areas,
with a particular focus on the business and data markets. Indian DLD service providers
are now permitted to directly offer services over their own last-mile networks, and Tata
is expanding its corporate fibre and wireless access networks, the latter using WiMAX
technology (which it is also extending to the residential market, see Domestic Broadband
Operations). In June 2006 Tata contracted Alcatel (now Alcatel-Lucent) to expand its optical
multi-service network in a USD20 million deal covering ten Indian states. Retail services for
consumers and businesses meanwhile are offered in partnership with sister companies Tata
Teleservices and Tata Teleservices (Maharashtra) under the Tata Indicom banner; its retail
portfolio includes dial-up and broadband internet access, VoIP, messaging and a range of
content services.
Tata began making waves in the international submarine cable market when its whollyowned Tata Indicom Cable (TIC) linking Chennai with Singapore went live in November
2004, with a maximum capacity of 5.12Tbps. Tata's global profile then received a huge
boost in July 2005, when it agreed to pay USD130 million for the Tyco Global Network
(TGN), a 60,000km submarine fibre-optic cable system connecting Asia, Europe and North
America, capable of supporting more than 7Tbps of traffic between Asia and the USA, and
accounting for around 44% of trans-Pacific capacity at the time of acquisition. Later that year
Tata was appointed network administrator for the SEA-ME-WE 4 undersea fibre network
linking Europe and Asia, while it also had a USD40 million investment in the Mumbai
SEA-ME-WE 4 landing station, launched at the end of 2005, providing India with a 1Tbps
link to Europe. Further, in October 2006 it signed a Memorandum of Understanding (MoU)
to join a consortium including Etisalat, Saudi Telecom, Telecom Egypt and Telecom Italia
Sparkle for the construction of a new undersea project, dubbed the India, Middle East and
Western Europe (I-ME-WE) cable system, which launched commercial services at the end
of 2009. Tata has also expanded its Asian undersea infrastructure via construction of the
USD200 million 6,700km TGN-Intra Asia (TGN-IA) Cable System, begun in November
2007, which provides up to 3.8Tbps capacity on a route linking Singapore, Vietnam, Hong
Kong, the Philippines and Japan; in August 2009 it announced the completed installation,
testing and commissioning of the TGN-IA system. Meanwhile, in December 2007 Tata
announced it would build an additional USD250 million cable connecting India with Europe,
in partnership with African international cable venture SEACOM and Telecom Egypt. The
planned link, known as the TGN Eurasia Cable System, would connect Mumbai to Paris,
London and Madrid via Egypt, providing 1.28Tbps of new bandwidth between India and
Europe by mid-2010. In March 2009 Tata announced that it had signed up as the SEACOM
undersea cable's anchor tenant and struck a deal to manage the Africa-Asia link, its billing
systems and customer relations, and a month later it was revealed that Tata would participate
in the USD600 million West African Cable System (WACS), a 14,000km submarine fibreoptic cable that will link countries in southern Africa, western Africa and Europe with at least
3.84Tbps of international bandwidth. More recently, in March 2012 the company announced
the completion of the TGN-Gulf cable linking Mumbai to the UAE, Oman, Qatar, Bahrain
and Saudi Arabia. At that date, it also announced that it had completed the worlds first
round-the-world fibre optic cable network, upon the launch of its TGN-Eurasia (TGN-

125

EA) cable linking Europe to India via the Mediterranean and Egypt. In combination with
its existing cable networks, Tata claimed to link Asia, the Middle East, Europe and the US
entirely on its own infrastructure.
Tata Communications Limited (formerly Videsh Sanchar Nigam Limited, VSNL) is owned
by multinational, multi-sector giant Tata Group and its subsidiaries (50.09%), and the
Government of India (26.12%), with the remainder divided between individual shareholders,
banks and financial institutions. The company is listed on the Bombay Stock Exchange (BSE)
and the National Stock Exchange of India (NSE), and its American Depositary Receipts
(ADRs) are listed on the New York Stock Exchange.

Quadrant Televentures (formerly HFCL Infotel)

8 Commercial Complex
Masjid Moth
Greate Kailash-11
New Delhi 110048
India
Tel. +91 17 25090000
Fax +91 17 25092047
http://www.connectzone.in
Quadrant Televentures (formerly HFCL Infotel) holds a Universal Access Service Licence
(UASL) covering Punjab, and the telco launched local telephony services in the city of
Chandigarh under the Connect brand in October 2000. Its hybrid PSTN/WiLL network now
covers a combined 200 towns and cities across the circle.
Quadrant launched pre-paid CDMA-based wireless in the local loop (WiLL) services in
February 2001 after a rollout of 800MHz IS-95A infrastructure by Alcatel-Lucent. It has
invested heavily in building out networks in major cities in the area, including Chandigarh,
Ludhiana, Jalandhar, Panchcula and Amritsar, and a CDMA2000 1x WiLL technology
upgrade was provided by Huawei in the first quarter of 2005. Limited mobility WiLL is
offered under the Connect Mobile banner. In March 2006 Quadrant launched IP telephony
services for retail and enterprise clients, based on Vistula Communications' V-Cube hosted
VoIP platform, including support for pre-paid calling cards. Meanwhile, the telco has also
continued to reduce the number of public call offices (PCOs) it operates in Punjab, to 3,000
at end-December 2013 from 4,000 in 2012, 6,330 a year earlier and 14,371 twelve months
before that. Similarly, the number of village public telephones (VPTs) that the telco had
in operation dropped to 27 at end-2013 from 31 in 2012, 70 a year earlier and 130 at 31
December 2010. Quadrants wireline subscribers have a choice of three plans, all of which
include caller ID as standard.
As at end-March 2014 Quadrant Televentures was majority owned by Videocon Group via
Quadrant Enterprises (53.36%). Other shareholders include: IDBI bank (19.32%), Oriental
Bank of Commerce (6.37%), Mantu Housing Projects Ltd (3.43%), Masitia Capital Services
(2.13%), Life Insurance Corporation of India (1.76%) and Moolsons Holdings (1.35%).

126

Country Directory
Regulators
Department of Electronics and Information Technology
(DeitY)
Ministry of Communications & IT
Electronics Niketan, 6 CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +91 11 24364041
Fax +91 11 24363134
http://deity.gov.in

Department of Information Technology (DoIT)

6, CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +91 11 24363094
Fax +91 11 24362628
http://www.mit.gov.in

Department of Telecommunications (DoT)

20 Ashoka Road
Sanchar Bhawan
New Delhi 110001
India
Tel. +91 11 23716874
Fax +91 11 23353303
http://www.dotindia.com

Ministry of Communications (MoC)

6 CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +91 11 24363094
Fax +91 11 24362628
http://www.moc.gov.in

127

Telecoms Regulatory Authority of India (TRAI)

A2/14, Safdarjung Enclave
New Delhi 110029
India
Tel. +91 11 26103294
Fax +91 11 26103294
http://www.trai.gov.in

Wireless Planning Commission (WPC)

Sanchar Bhavan
20 Ashoka Road
New Delhi 110001
India
Tel. +91 11 4364757
Fax +91 11 4363134
http://www.wpc.gov.in

Service Providers
Aircel
5th floor, Spencer Plaza
769 Anna Salai
Chennai 600006
India
Tel. +91 44 28490849
Fax +91 44 28496769
http://www.aircel.com

Bharat Sanchar Nigam Ltd (BSNL)

Sanchar Bhavan
20 Ashoka Road
New Delhi 110001
India
Tel. +91 11 23730392
Fax +91 11 23353303
http://www.bsnl.co.in

Bharti Airtel
Bharti Crescent
1, Nelson Mandela Road
Vasant Kunj
New Delhi 110 070
India
Tel. +91 11 46666100
Fax +91 11 46666411
http://www.airtel.in

128

Idea Cellular
Windsor', 5th Floor, off CST Road
near Vidya Nagari, Kalina
Santacruz (East)
Mumbai 400098
India
Tel. +91 79 66714000
Fax +91 79 23232251
http://www.ideacellular.com

Loop Mobile
127 Manmala Tank Road
Taikalwadi
Mahim
Mumbai, Maharashtra 400016
India
Tel. +91 80 6589080
Fax +91 80 6589054
http://www.loopmobile.in

Mahanagar Telephone Nigam Ltd (MTNL)

5th Floor, Mahanagar Doorsanchar Sadan
9, CGO Complex
Lodhi Road
New Delhi 110003
India
Tel. +011 24310212
http://mtnlmumbai.in
http://mtnldelhi.in

Quadrant Televentures (formerly HFCL Infotel)

8 Commercial Complex
Masjid Moth
Greate Kailash-11
New Delhi 110048
India
Tel. +91 17 25090000
Fax +91 17 25092047
http://www.connectzone.in

Reliance Communications (RCOM)

H Block, 1st Floor
Dhirubhai Ambani Knowledge City
Navi Mumbai 400 0710
India
Tel. +91 22 30386010

129

Fax +91 22 30376622

http://www.rcom.co.in

Reliance Jio Infocomm Ltd (RJIL)

Maker Chambers IV
222 Nariman Point
Mumbai 400 021
India
Tel. +91 22 2278 50000
Fax +91 22 2278 5185
http://www.ril.com

Sistema Shyam TeleServices (SSTL, MTS India)

334 Udyog Vihar
Phase-IV
Gurgaon, Haryana 122001
India
Tel. +91 124 4615899
http://www.mtsindia.in

Siti Cable
135 Continental Building
Annie Besant Road
Worli
Mumbai 400 018
India
Tel. +022 66971234
Fax +033 24900302
http://www.siticable.com

Tata Communications
Plot #C-21 and #C-36 Block G
Bandra Kurla Complex
Bandra (East)
Mumbai 400098
India
Tel. +91 22 66578765
http://www.tatacommunications.com

Tata Teleservices (TTSL, inc. TTML and Tata DOCOMO)

DLF Square
11 Floor M-Block
Jacaranda Marg
Gurgaon 122002
India
Tel. +91 124 2560500

130

Fax +91 124 2560619

http://www.tatateleservices.com

Uninor (Telewings)
The Masterpiece
Plot No. 10 Golf Course Road
Sector 54, DLF Phase 5
Gurgaon, Haryana 122002
India
Tel. +91 0124 3329000
http://www.uninor.in

Videocon Telecommunications Ltd. (formerly Datacom)

248, Udyog Vihar
Phase IV
Gurgaon, Haryana 122015
India
http://www.videocontelecom.com

Vodafone India (formerly Hutchison Essar)

Peninsula Corporate Park
Ganpatrao Kadam Marg, Lower Parel
Mumbai 400013
India
Tel. +91 22 56645000
Fax +91 22 56661200
http://www.vodafone.in
Last Updated: 30 June 2014

131

The content on the preceding pages is a section from TeleGeography's GlobalComms

The work is based on sources believed to be reliable, but the publisher does not warrant the accuracy or
completeness of any information for any purpose and is not responsible for any errors or omissions.
This work is for the confidential use of subscribers. Neither the whole nor any part of this publication may
be reproduced or transmitted in any form or by any means, electronic, mechanical, photocopied, recorded
or otherwise, without prior written consent from PriMetrica, Inc.
All rights reserved. 2015 PriMetrica, Inc.
TeleGeography
A Division of PriMetrica, Inc.
Washington, D.C. / San Diego / Exeter
U.S. tel: +1 202 741 0020 / U.K. tel: +44 1392 315567.
www.telegeography.com

132