Archive for September, 2012
With the introduction of iPhone 5 on iOS 6 in the US, China Unicom the iPhone partnering operator in mainland has made adjustments to their iPhone 4S subscription packages.
China Unicom has two different schemes to its iPhone subscribers
- an iPhone buyer receives an iPhone handset subsidy but no discounts on monthly service fee (handset subsidy rebate plans)
- an iPhone buyer pays full price for the handset and receives discounts on monthly service fee (monthly fee discount plans)
In this latest round of adjustments to iPhone 4S subscription packages, China Unicom lowered the retail price of iPhone 4S (under monthly fee discount plans) on a nationwide basis. However, China Unicom has not made any adjustments to its “handset subsidy rebate” plans in most of the provinces. When iPhone 5 is launched in China later this year, these adjustments will not apply to iPhone 5′s subscription packages.
With the latest promotions limited to “monthly fee discount” plans only, we believe China Unicom is making a sincere effort to control its 3G handset subsidy. The latest price adjustments may attract some hesitant potential iPhone buyers. For iPhone followers in mainland who want to catch Read the rest of this entry »
Ban on combo vouchers maybe lifted soon:
The chairman admitted that the ban on combo vouchers hit industry profitability hard in 1QFY13. TRAI would issue guidelines shortly on the possible reintroduction of combo vouchers.
TRAI Working on M&A Rules
Current M&A guidelines have some potential deterrents in the form of spectrum usage charges being applied on the total spectrum of the merged entity and higher excess spectrum charges. The chairman’s view on industry consolidation is in line with the market reality of some telcos having too much debt and accumulated losses. TRAI is expected to clarify further on M&A guidelines with a view to making them less obstructive than at present.
TRAI may not Oppose / Regulate Tariff Hikes Read the rest of this entry »
Anil Ambani managed Reliance Communications [CDMA & GSM] has raised calling rates by 25% since last Friday. The Company said it has revised its base tariff from 1.2 paise per second to 1.5 paise per second and this would be initially implemented in four states [(Himachal Pradesh, Madhya Pradesh, Bihar and Gujarat] and would be rolled out across the rest of the county within a month. RCom’s revised call rates will initially affect new customers and will be extended to its existing users when the validity of their current tariff plans expires.
RCom Tariff Hike Sustainable Only if Airtel Responds
Reliance Communications has poor quality subscriber base (active subscriber base is c76% vs. c90% for Airtel, Idea and Vodafone) and will have an uphill task to sustain the hike. Separately, although RCom is a number 3 player in Bihar, HP and MP, it is a laggard in almost all other circles. Replicating the hike across India could prove to be difficult if competitors do not follow suit.
RCom Revenue Market Share may erode Further
Voice Call tariff hike is the right step going forward, we remain skeptical on whether RCom’s strategy would help it increase its Revenues. Reliance GSM is a relatively new entrant, therefore we see more risks of its subs churning out or MOU / Subscriber
declining led by tariff hike. Furthermore if operators like Airtel / Vodafone do not follow this move, Reliance will witness erosion in revenue market. Read the rest of this entry »
Google Acquired Mobile Platform from Andy Rubin, Android has now turned four and faces challenges amid growing fragmentation issues.
Talks with Android users across Asia and India suggest that they are largely unaware about technology platform wars we have been highlighting, as consumer focus has gone even deeper than brand to become product and service specific.
Android Fragmentation and App Developers Challenges
The fundamental issue of fragmentation and splintered or forked Android versions does not seem to matter to consumers as they have come to expect Apps and Services to simply work. This has been a problem for Developers who lament not only the costs associated with tweaking and testing their apps across more than a hundred variant Android devices but also that the need for Google to contain fragmentation is dire.
Developers feel it is in Google’s best interest to get involved deeply and directly with Motorola Mobility and also to keep the entire Android market instep behind Motorola and circumscribe the technological variance and technological footprint. This becomes a necessary move as the entry smartphone or value smartphone market grows faster in unit volumes, number of operators and geographic reach. Read the rest of this entry »
Chrome Set to be Default Browser on Motorola’s Andoid Sets – Droid Razr M, Droid Razr Maxx and Droid Razr HD
Motorola Mobility the subsidiary of Google Inc has announced Droid Razr M, Droid Razr Maxx and Droid Razr HD, the first Android 4.0 smartphones running Ice Cream Sandwich that will have Google’s Chrome as their default browser. The ongoing race to provide a commonality of services over a broad majority of device classes will move the already hyper-competitive TMT industry to the next level of over-the-top application ubiquity.
The battlefield is the browser but the war goes deeper into native binary portability. Baidu has launched a new HTML5 based Internet browser for Android mobile devices, enabling users to play games and watch videos within their browser. In the long term, a mobile browser is critical for Baidu to leverage its momentum in search and advertising beyond China.
The Chrome browser for Android that was shown in Barcelona’s Mobile World Congress is a significant move within Google’s overall ecosystem and strategy for Android because within Android 4.0 (Ice cream sandwich), Google starts on their longer term plan to deliver commonality of services and portability across device classes. Chrome browser that comes in Motorola Razr series handsets is the same on that runs in the Google Nexus 7 tablet, and apps or widgets that are written to HTML5 capabilities within the Chrome browser will perform across both smartphones and tablets.
Commonality of services today (across SmartPhone, Tablets and Laptops / PC) is still limited to synchronization of bookmarks and tabs or very simple script apps, the potential across even broader devices including smartTVs and other devices in the era of convergence is high, especially because of the HTML5 capabilities that Chrome supports. Read the rest of this entry »
TRAI Data Reveals that Post-Paid Mobile Subscribers are switching Platforms from CDMA to GSM. Post-paid subscribers are of relatively high quality and essentially are subscribers that were the early adopters of wireless telephony. The GSM incumbents, as a result, have managed to garner the majority share of these subscribers.
Over-time, pre-paid became the default choice for subscribers lower down the quality and this led to post-paid % (of overall subscribers) witnessing a declining trend. The trend accelerated with the GSM launch by dual technology operators – Tata DoCoMo and RCom. Some new entrants, like Uninor, didn’t even offer post-paid connection and encouraged churn.
The growth rate of post-paid subscriber additions has infact doubled in the last 5 quarters v/s the previous 4 quarter period (see chart below). Interestingly, the proportion of post-paid subscribers actually rose albeit marginally in the Mar-12 quarter.The catalyst for this reversal in trend looks to be mobile number portability with CDMA post-paid subscribers shifting to GSM competitors. Adding to the advantage of GSM operator is the wider choice of new SmartPhones which are the sought after gadgets of Post-Paid subscribers who also have high ARPU.
GSM Mobile Operators ARPU premium v/s CDMA Operators has narrowed from 110% in Mar-2009 to 30% by Mar-2012. CDMA subscribers have traditionally been of relatively inferior quality compared to the GSM subscribers. This has been due to the historical positioning of CDMA as a “Poor Man’s Phone” and also the locking of handsets to particular network discouraged consumers from subscribing to the same.
The big gap in ARPU suggests that the dual technology strategy that was adopted by the CDMA players (Tata DoCoMO and Reliance Communications) at the time was less out of choice and more out of compulsion. The gap in the ARPU between the two technologies has since then narrowed significantly and currently stands at just 30% (Mar-12).
What are the Reasons for Narrowing of GSM Vs CDMA ARPU Divergence ?
- Increasing focus of non-voice revenues (EVDO Based USB Data Dongles) in the CDMA segment – Rose in contribution from 9% in Mar-09 to 31% by Mar-12 as operators shifted their focus towards Data Services [Wireless Broadband]
- Average outgo / min for CDMA has fallen 17% from Mar-09 to Mar-12 compared to a 35% fall in the case of GSM operators.
The trend is likely to stabilize once the competitive intensity reduces in the GSM space leading to lower discounting. High spectrum payments force all operators to behave rationally and could see uptick in tariffs and finally Data starts to contribute more meaningfully as 3G picks up.
Bharti Infratel Ventures is a 86.1% subsidiary of Bharti Airtel Ltd. Bharti Infratel is planning for installation of 4,813 new towers along with upgrading and replacement of existing towers. It also plans to undertake green initiatives on tower sites.
Bharti Infratel’s business strategy is as follows, Read the rest of this entry »