‘Tariffs should have been raised yesterday’
Rishi Raj, Anandita Singh Mankotia : Dec 21 2012, 20:08 IST
Telcos in India are grappling not just with fierce competition or high customer acquisition costs, but a tough regulatory environment in which the soaring cost of spectrum is pressuring their balance sheets. As the market leader, Bharti Airtel has coped fairly well, though the September 2012 quarter saw its eleventh consecutive y-o-y decline in net profits. Also, the telco’s Africa operations are yet to turn profitable. The one-time charge for the spectrum it holds beyond 4.4 Mhz and 6.2 Mhz could cost it an estimated R6,000 crore. Moreover, it will need to cough up an additional amount when it vacates the more efficient spectrum in the 900 Mhz band and bids for it again. Sanjay Kapoor, who heads the Indian and South Asian businesses, tells Anandita Singh Mankotia & Rishi Raj that spectrum is not being priced right and that a one-India, one-licence plan needs to be thought through, before it takes off. However, Kapoor is optimistic that consolidation in the industry could kick up tariffs.
With the auctions for 1800 Mhz spectrum not really a hit since four circles didn’t find takers and of the remaining 18, excluding Bihar, the spectrum got sold at the reserve price, would you say that consolidation has begun?
There were certain structural defects in the sector, in the sense of too many players, and the market had become too fragmented. We believe consolidation probably first began in the minds of the subscribers as we saw the top three or four operators continuing to hold
Previous Story Circulation of counterfeit currency will now be terrorist act Next Story 'Govt may apply stick on cos which do not spend money on CSR'
Reader's Comments| Post a Comment
Be the first to comment.
