Nokia announced that it has made 125 million mobile handsets in India over the last two years. That by all means is a huge number. But what the Finnish major failed to mention was that during 2007 it made 100 million handsets at its plant at Sriperumbudur, near Chennai. That's because in 2007 Nokia had announced it made 25 million handsets in India during 2006.
That's already showing in the results. Earnings from the Indian operations have grown from Euro 2.71 billion (Rs 15,803 crore) to Euro 3.9 billion (Rs 24,968.7 crore). That's a cool 43.91% rise in revenues in Euro terms in just a year. I guess that's easy when you control more than half of the worlds fastest growing mobile market. After all, India has been adding over 8 million new mobile subscribers a month.
To do that it needs a lot more people. During 2007 the headcount at Nokia India has gone up from 3,800 to 8,000. By this time next year Nokia plans to have 13,000 employees in India. That's literally trebling the workforce in two years! All this needs additional investment, which will rise from the $ 210 million already committed to $ 285 million over the next year.
With 100 million handsets out of India, it is head and shoulders above the rest of the handset makers--Elcoteq, Samsung, LG, Motorola and Flextronics. Of these, the only one can that can match Nokia is Flextronics that has a huge facility with two plants down the road from the Nokia plant.
No wonder, Nokia is by far the biggest multinational in India. It remains to be seen how it will leverage Ovi (means "door" in Finnish) in India. That's when it will have to fight the entrenched service providers. It will be an interesting play. Stay tuned.
Monday, March 31, 2008
Thursday, March 27, 2008
Finally, no more ADC
It’s finally happening. Starting 1 April, the Access Deficit Charges (ADC) on domestic calls has been phased out. For international calls it has been halved to 50 paise from the present Re 1. ADC is a charge that private operators have been paying state-owned BSNL to help roll-out telecom services in rural areas since May 2003. Till date BSNL should have received close to Rs 20,000 crore from ADC.
Already, the bigger private operators like Bharti Airtel and Vodafone Essar have agreed to pass on the benefits to the consumer.
But, does it help the subscribers. Not really. That’s because it makes a Re 1 call cheaper by—well—0.75%. That’s not something substantial that will show up in the bill. The real gainers are the operators. It is estimated that operators will save close to Rs 2,700 crore. That’s something to celebrate about.
The real loser in this will definitely be BSNL. However, the government has promised to allocate Rs 2,000 crore from the Universal Service Obligation Fund (USOF).
Will that mean the rural roll-out will get slowed down? Unlikely. As all operators have realised, the growth is happening only in the smaller towns. The metros and the big towns are close to saturation. So, ADC or not, the march to rural India by private telcos will continue unabated. After all that is where the gravy will come from.
Already, the bigger private operators like Bharti Airtel and Vodafone Essar have agreed to pass on the benefits to the consumer.
But, does it help the subscribers. Not really. That’s because it makes a Re 1 call cheaper by—well—0.75%. That’s not something substantial that will show up in the bill. The real gainers are the operators. It is estimated that operators will save close to Rs 2,700 crore. That’s something to celebrate about.
The real loser in this will definitely be BSNL. However, the government has promised to allocate Rs 2,000 crore from the Universal Service Obligation Fund (USOF).
Will that mean the rural roll-out will get slowed down? Unlikely. As all operators have realised, the growth is happening only in the smaller towns. The metros and the big towns are close to saturation. So, ADC or not, the march to rural India by private telcos will continue unabated. After all that is where the gravy will come from.
Sunday, March 16, 2008
Catering to senior citizens
Now maverick Richard Branson is here with Virgin Mobile. So the quite stodgy Tata Indicom is trying to cater to the needs of the youth. That's an interesting prospect. Going by Branson's track record, what it will offer to the youth remains to be seen!
So is this the beginning of the segmentation of the Indian mobile market? The BlackBerry already meets the needs of the busy executive. Virgin Mobile will go for the youth. But with affluence levels rising, there is a market for senior citizens too. A large chunk of the 60+ Indians today are quite well-to-do. Also with spare time on hand, they could be all set to download music and ringtones.
With children working in different parts of India and even abroad, these users will make long-distance calls too. So, are any operators looking to meet the needs of the senior citizens? That's a market ready for the picking.
However, a caveat. Obviously, the youth will use their phones for more years than their senior citizen counterparts. But then that is no reason to not focus on this market. Are operators listening?
So is this the beginning of the segmentation of the Indian mobile market? The BlackBerry already meets the needs of the busy executive. Virgin Mobile will go for the youth. But with affluence levels rising, there is a market for senior citizens too. A large chunk of the 60+ Indians today are quite well-to-do. Also with spare time on hand, they could be all set to download music and ringtones.
With children working in different parts of India and even abroad, these users will make long-distance calls too. So, are any operators looking to meet the needs of the senior citizens? That's a market ready for the picking.
However, a caveat. Obviously, the youth will use their phones for more years than their senior citizen counterparts. But then that is no reason to not focus on this market. Are operators listening?
Tuesday, March 11, 2008
Soul of the Indian Night
Over the last dozen-odd years, hundreds of mobile handsets have been launched in the country. But this time round, when Nokia launched the N82, it has come up with the unique Soul of the Night. It's a wireless adventure that is happening in Delhi, Mumbai and Bangalore. Over the past few months, Nokia has done similar events across the Asia Pacific region.
Over the past few weeks, several celebrities are blogging on the site with their N82 handsets. These celebrities are posting pictures of locations, restaurants, pubs and events in their cities. The celebrity list includes Manish Arora, Mandira Wirk, Murali Karthik in Delhi; Dino Morea, Niaha Jamwal and Shiamak Davar in Mumbai; Charu Sharma and Prasad Bidapa in Bangalore.
Well, the action is not restricted to these cities. There are postings from Bihar, Uttaranchal and Jharkhand too.
But then the N82 is not just a phone. I have been playing around with an N82 over the past fortnight. It has anything that anybody would want. Today all phones have cameras, video recorders etc. But the N82 also has music, a really superb camera, GPS, city maps, location finder and a huge, huge memory. The best feature is Nokia Maps that allows users to download maps of 150 countries. Also, it provides voice-activated navigation that allows the user to simply drive his car while the phone tells you how to get to your location. Plus downloading the maps is free. So no more stopping and asking directions in a strange city!!
So what more could you ask for on one device. Oh i forgot. You can surf the worldwide web and post on your blog with it. Simply cool.
Over the past few weeks, several celebrities are blogging on the site with their N82 handsets. These celebrities are posting pictures of locations, restaurants, pubs and events in their cities. The celebrity list includes Manish Arora, Mandira Wirk, Murali Karthik in Delhi; Dino Morea, Niaha Jamwal and Shiamak Davar in Mumbai; Charu Sharma and Prasad Bidapa in Bangalore.
Well, the action is not restricted to these cities. There are postings from Bihar, Uttaranchal and Jharkhand too.
But then the N82 is not just a phone. I have been playing around with an N82 over the past fortnight. It has anything that anybody would want. Today all phones have cameras, video recorders etc. But the N82 also has music, a really superb camera, GPS, city maps, location finder and a huge, huge memory. The best feature is Nokia Maps that allows users to download maps of 150 countries. Also, it provides voice-activated navigation that allows the user to simply drive his car while the phone tells you how to get to your location. Plus downloading the maps is free. So no more stopping and asking directions in a strange city!!
So what more could you ask for on one device. Oh i forgot. You can surf the worldwide web and post on your blog with it. Simply cool.
Thursday, March 6, 2008
Tata's Virgin gamble--Will it work this time?
Virgin Mobile is now in India, courtesy Tata Teleservices. That is an interesting combination--the maverick boss of a highly successful telecom service with the staid boss of India's slowest operating telecom company.
But, what is not clear is whether it is an MVNO or a franchisee operation. That is because the government has not given the green signal for starting MVNO services in India. So what exactly is this new animal?
That's what the Tatas should answer. After all, it has morphed its telecom operations so many times that one simply does not know aht they are up to. Yes, it seems to be the most confused mobile operator in the country.
A little bit of history here on the Tatas telecom business. It started life as Tata Cellular, a GSM service provider in Andhra Pradesh. Then it decided to join hands with Birla AT&T that provided GSM services in Maharashtra and Gujarat. That later morphed into IDEA Cellular.
Somewhere during this passage, the Tatas felt going CDMA was a better bargain. After all, the then Mukesh Ambani controlled Reliance Infocom was going the CDMA way. Then it sold its stake in IDEA to the Aditya Birla group. Now that the Anil Ambani controlled Reliance Communications is going the GSM way, the Tatas are as usual following them.
But going the MVNO way is a new path altogether. So when the Cellular Operators Association of India (COAI) raised objections, it has come up with a new complaint--the telecom policy did not allow outsourcing of networks.
But hello--what was the group doing for well over three years. After all, Bharti outsourced its network ages ago and has become a case study for mobile operators globally.
The confused thinking is clearly reflected in the subscriber base. It has just 22.5 million subscribers in 20 circles as opposed to IDEA which has 21.95 million subscribers while being present in only 11 circles. The only two circles where Tata is not present are North-East and J&K.
Maybe Richard Branson can pull this group's telecom business by the boot straps. That's what the group needs, if its telecom business has to last out.
But, what is not clear is whether it is an MVNO or a franchisee operation. That is because the government has not given the green signal for starting MVNO services in India. So what exactly is this new animal?
That's what the Tatas should answer. After all, it has morphed its telecom operations so many times that one simply does not know aht they are up to. Yes, it seems to be the most confused mobile operator in the country.
A little bit of history here on the Tatas telecom business. It started life as Tata Cellular, a GSM service provider in Andhra Pradesh. Then it decided to join hands with Birla AT&T that provided GSM services in Maharashtra and Gujarat. That later morphed into IDEA Cellular.
Somewhere during this passage, the Tatas felt going CDMA was a better bargain. After all, the then Mukesh Ambani controlled Reliance Infocom was going the CDMA way. Then it sold its stake in IDEA to the Aditya Birla group. Now that the Anil Ambani controlled Reliance Communications is going the GSM way, the Tatas are as usual following them.
But going the MVNO way is a new path altogether. So when the Cellular Operators Association of India (COAI) raised objections, it has come up with a new complaint--the telecom policy did not allow outsourcing of networks.
But hello--what was the group doing for well over three years. After all, Bharti outsourced its network ages ago and has become a case study for mobile operators globally.
The confused thinking is clearly reflected in the subscriber base. It has just 22.5 million subscribers in 20 circles as opposed to IDEA which has 21.95 million subscribers while being present in only 11 circles. The only two circles where Tata is not present are North-East and J&K.
Maybe Richard Branson can pull this group's telecom business by the boot straps. That's what the group needs, if its telecom business has to last out.
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