October 2009 Archives

PPP - A famous protocol for reliable customer access, control, and maintenance has another meaning with EC announcements on NGN investment framework. Public Private Participation is a welcome idea for rapid roll out on upcoming technologies. Collaboration is a well known concepts in Telecommunication industry, Operators have to share available infrastructure, Route servers have to share inter continent routes, Internet exchanges have to share traffic. collaboration is the base for Internet and hence telecom network as  a whole. This has an added advantage when it comes to creating a fibre infrastructure, Infinite bandwidth that fibre offer is inevitable in Next Generation Network (NGN) roll out. Voice, Video, and Data tripe play offerings need more bandwidth, Upcoming technologies like LTE, WiMax, LTE advanced, and WiMax advanced base stations need a reliable high bandwidth interconnection. Having a fibre optic infrastructure and latest technology access network is inevitable in NGN.

Europe is well behind in FTTH


Today there are signs that Western Europe is falling behind the rest of the world in FTTH deployment, which worries Europes equipment manufacturers. Idate in a report published earlier this year said the Asian market accounted for 80% of the worlds 28.2 million FTTx subscribers last year. There were a total of 22.5 million fibre subscribers in Asia by the end of June 2008, with Japan leading the way with 13 million. Europe took a 7.4% share of global FTTH/B subscribers and the US 5.2% said Idate.
The government in Singapore asked operators to bid for contracts to provide a passive dark fibre network, and a separate active network which would be open to multiple service providers.Singtel, the national incumbent, was part of a four-party consortium that last year won the national dark fibre contract, thereby giving the consortium access to Singtels ducts.

Regulatory Positions in Europe:

ECTA accepts the principle that operators should share investments in joint ventures, but it doesnt trust incumbents to create a competitive environment. If competition and choice for consumers and businesses are guaranteed through this arrangement then regulation could be removed. But we have seen no signs that incumbents are seriously interested in negotiating in good faith with their rivals, except as a means to delay and confuse the process, it says in a statement.

The reality is there are n't that many substantive build these networks. There is a bit of a view in some parts of telecoms that we have an automatic right to participate without any investment. That is not reasonable.Current European regulation is geared to promote infrastructure-based competition by providing a relatively low cost of market entry through wholesale access to former incumbents copper networks. That has allowed fixed alternative operators to acquire customers before investing in partial and full un-bundling. The ECs current draft recognizes that NGAs change the ground rules and will need new regulatory models. Any operator that combined an infrastructure monopoly with service provisioning would likely face long-term regulation. Do not expect European governments building open access networks with substantial public funds as planned in Australia and New Zealand. The Australian government, for example, in April said it will oversee the construction of an A$43 billion nationwide fiber-to-the-premises (FTTP) network through a company in which it will hold a minimum 51% stake. In Europe there wont be that level of state financing. Most of it will be built with private money, says Feasey.

Certainly, some government funding plans are receiving a mixed response. In the UK, the government reportedly is considering going against the politically sensitive recommendation in the June Digital Britain report to tax phone services in order to part-fund next-generation access networks in rural areas. And in the US, the three largest operators have chosen not to apply for funding from the first round of the broadband stimulus package to roll out services in un-served and under served regions. Whatever approach is taken, Shared investment mode can maintain competition and protect consumer interests. There isn't a trade-off between competition and investment. Minimum number of players is needed. The mobile market is the only one where we have seen significant network investment and where there is what most regulators would regard as acceptable levels of competition. Mobile networks are not perfectly competitive as there are not thousands of service providers. There are three or four.

Collaborations so far in Europe:

Mobile operators, and notably Vodafone, already share passive infrastructure in some European countries. In Sweden, Tele2 and Telenor this year went a step further and agreed to share active mobile infrastructure for LTE networks, reflecting a move to focus on the branding and distribution of services rather than exclusive control of the underlying networks.Its all about branding and really understanding customer needs and distribution, says Lars-Ake Norling, CEO of Telenor Sweden, explaining the decision to share with Tele2 both the RAN and spectrum of their future 4G networks.

Vodafone already has struck a deal for fixed network sharing. Last December Vodafone Germany and Deutsche Telekom announced they would provide each other with wholesale access to VDSL networks to be built in Heilbronn by Vodafone and in Wurzburg by Deutsche Telekom.

The UK has taken a different approach to opening up infrastructure, introducing structural separation of the copper loop. But in many countries structural separation has proven unpalatable.


3G and BWA Wireless spectrum auction base price announced, as usual government has exceeded all predictions, My prediction too. Do read my previous analysis on expected revenue to government Here. As usual reaction from industry is totally against high price. Government is looking at money and not affordability, some strong reaction from Industry icons.
  • Pan-india 3G spectrum base price is 35 Billion INR.
  • 3 nos of 20MHz spectrum total base price is 17.5 Billion
  • 2 nos of 1.25MHz slot of EV-DO spectrum base price is 8.75 Billion
Stated by one of the popular Telecom journal in  India tele.net. COAI (Cellular Operators Association of India) expressed concerns about huge difference between base price of 3G spectrum adn BWA. COAI is very much concerned about WiMax operators backdoor entry in to 3G, they further explained that since WiMax and 3G can offer similar type of services and availability operators will choose WiMax and get in to 3G customer base with less spectrum cost. AUSPI (Association of Unified Telecom Service Providers of India) also expressed concerns over price difference and limiting the number of spectrum to 2 in case of CDMA. They have also criticized about government policy of increasing the competition in auction by reducing the number of participating band. On the other hand ISPAI (Internet Service Providers Association of India) expressed concerns about huge base price and further limitation in roll out obligations.

In my view government intention to gain as much as 250 Billion in revenue is met. This huge difference between competing technologies enable big muscle players to hold all possible spectrum and hence technology monopoly in Indian Telecommunication industry. Internet service providers will have huge problem in terms of keeping their present customer and gaining new customers. Mobile operators will easily meet coverage and roll out obligations by using their available passive and back bone infrastructure where as Internet service providers can not. On the other hand ISP stron hold of IP back bone will leverage more managed services business opportunity. Government should use alternate mechanisms to bridge digital divide, allowing operators to use 700MHz spectrum to meet rural coverage obligations is one such solutions.
I went to a near by prepaid card and mobile peripheral reseller few months back. Out of curiosity asked him a question about which mobile connection sells faster. He said "TATA DOCOMO is the fast mover, all 500 connection cards of his quota soled out in 2 Hrs and waiting for next dispatch, If you want a new connection book in advance with RS 100 payment." And to my question why ? his answer is 1 sec billing. TATA DOCOMO simple USP is "PER SECOND BILLING". To an end customer it saves lot of money, since so long one minute billing from other operators are charging a same amount for 1 sec as well as 59secs of call duration. Those mobile operators billing is technically wrong. Phone usage should be billed based upon ERLANGS. A unit to measure Hrs of traffic used in an hr. It is a statistical measure of offered load. With this every second will have big difference on required link capacity and hence investment. Docomo's strategy of per second billing is in either way does good thing for indian mobile communication industry. Soon all the other operators may have to follow similar frame work. TATA GSM has become number one in terms of user addition Thanks to per second billing. BSNL has started billing as per sec pulse. Recently TRAI's chairman suggested similar norms.
 
We may ask all the operators to consider per-second pulse as a mandatory tariff option along with their other tariff plans, Even there (in per-second tariff plan), they must ensure to bring out clearly all the riders and caveats" Telecom Regulatory Authority of India (TRAI) Chairman J S Sarma told reporters on the sidelines of the International Telecommunication Union conference in Geneva.

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