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Telenor, the Norwegian multinational telecommunications company, which started <a href="http://www.businessinsider.in/8-years-after-its-debut-and-a-year-after-its-re-launch-2G-struck-Telenor-might-exit-India-citing-limited-presence/articleshow/51774606.cms">its India operations</a> in 2009, has said that it would not participate in the upcoming spectrum sale scheduled next month. With this, the Bærum-headquartered company has shown signs of taking an exit from India’s telecom industry. 
 
It is "after thorough consideration, decided not to participate in the upcoming spectrum auction (in India), as we believe the proposed spectrum prices do not give an acceptable level of return," said a statement from Sigve Brekke, President and CEO of Telenor Group. 
 
He added that the decision was not influenced by "the significant operational and financial improvement delivered by our Indian operation". 
 
Earlier, Telenor had reported that it might be <a href="http://www.businessinsider.in/Telenor-operating-loss-India/articleshow/52011481.cms">forced to leave India</a> if it doesn’t secure additional capacity for its networks at a reasonable cost. 
 
The Telenor CEO added that they would, however, continue their efforts to meet the demands of their customer and grow the business here in <a href="http://www.businessinsider.in/Telenor-names-Sharad-Mehrotra-as-new-India-CEO/articleshow/49323002.cms">India</a>. 
 
The reason why Telenor could never attract Indian customers was the <a href="http://www.businessinsider.in/Uninor-is-now-Telenor-No-3G-steamto-roll/articleshow/49075889.cms">lack of 3G</a> or 4G services, because it holds very limited data <a href="http://www.businessinsider.in/Uninor-inks-a-deal-with-Huawei-to-expand-its-network-in-India/articleshow/48449248.cms">spectrum</a>. Other than this, the company operates in just a few circles in the country. 
 
<a href="http://s1.ibtimes.com/sites/www.ibtimes.com/files/2013/07/04/telenoruninorindia.jpg">Image source</a>

Is it the end of Telenor India’s acarpous journey?

The ‘sabse sasta’ telecom operator Uninor has renamed itself <a href="http://www.businessinsider.in/searchresult.cms?query=Telenor">Telenor</a> today. It is now a 100% subsidiary of <a href="http://www.businessinsider.in/searchresult.cms?query=Telenor">Telenor</a>, thanks to <a href="http://www.businessinsider.in/searchresult.cms?query=FDI">FDI</a>. 
 
“We continue to focus on the three strategic pillars as a company – best in basic services, mass market distribution and low cost of operation. We’re the #1 operator in terms of price perception”, Vivek Sood, CEO, <a href="http://www.businessinsider.in/searchresult.cms?query=Telenor">Telenor</a> India said. 
 
The brand looks to refresh its identity after the 2012 fiasco and ramp up its India operations. <a href="http://www.businessinsider.in/searchresult.cms?query=Telenor">Telenor</a> India currently contributes 6% to <a href="http://www.businessinsider.in/searchresult.cms?query=Telenor">Telenor</a>’s global revenue and 12% of its Asia revenue. 
 
“As a committed shareholder, <a href="http://www.businessinsider.in/searchresult.cms?query=Telenor">Telenor</a> continues to invest in our business. Even after 2012 when we went through difficult times, they’re still interested to create a long term story”, Sood said. 
 
Speaking at the launch, the Chief Executive was clear about the company’s target consumer base. 
 
“Uninor has typically positioned itself as the one with the lowest ARPU (price per min) operator. Our customers are not necessarily savvy, and need to be treated fairly. That’s our focus. It’s beyond sab se sasta (the cheapest)”, he said. 
 
The company launched its mobile app and is introducing call drop reimbursement across STD, ISD and local tariffs. 
 
“We’re also getting our network ready for the next stage of services. However, since the government guidelines have come very recently, it’s still too early to comment”, Sood affirms. 
 
However, when asked about the possibility of a 3G/4G rollout in a market of slipping call durations and tariffs, not to mention the ongoing smartphone revolution, Sood is dismissive. 
 “There is euphoria around <keyword id="122479" type="COMPANY" weightage="100" keywordseo="4G">4G</keyword> and 3G services. There’s still a lot of work to be done on the basic 2G services. Our internet penetration is around 25%. That’s not too different from what the large operators have. If there is a strong package of basic services customers can afford, they’ll want that. However, there is no urgency from our end”, he says. 
 
<a href="http://www.businessinsider.in/searchresult.cms?query=Telenor">Telenor</a> India currently has 47.5 million subscribers in the 6 circles they currently operate in.

Uninor is now Telenor. No 3G steam
to roll

<keyword id="6359476" type="CITY" weightage="100" keywordseo="Telenor">Telenor</keyword>, the Norwegian multinational telecommunications company, has reported a huge operating loss of around Rs 2,530 crore for its Indian telecom business, because of which it has threatened to exit India if it fails to procure spectrum at reasonable rates. 
 
This has happened almost at the same time when Telenor’s Indian arm is looking forward to expanding its 4G footprint, claiming the lowest tariff for these services as part of its affordable pricing strategy. 
 While announcing financial results in Norway, Telenor global CEO <keyword id="213014" type="PERSON" weightage="100" keywordseo="Sigve-Brekke">Sigve Brekke</keyword> said, "Long terms presence in India is dependent on our ability to secure additional spectrum. We are not able to compete with current spectrum portfolio we have in growing data market." 
 
Brekke added that they are looking at solution to procure spectrum along with "a price that we can justify". 
 
"We are Looking at upcoming auctions and also looking at potential trading options... Need to be pragmatic to consider other alternatives if that turns out not to be a possible to find value focused solutions. We are looking at all sustainable business model option," Brekke said. 
 
"We are in India to make money, if we don't see return then we need to look at other alternatives," Telenor CFO Morten Karlsen Sorby said. 
 
Telenor has already launched 4G services in Varanasi, and is planning to roll out high speed services in 6 to 8 cities across its six circles, namely Andhra Pradesh, Uttar Pradesh East and West, Bihar, Gujarat and Maharashtra, in the coming two months. 
 
<a href="http://e24.vgc.no/drpublish/images/article/2015/11/19/23563896/1/990/2462836.jpg">Image source</a>

Telenor’s huge operating loss might ‘force’ it to exit India

<keyword id="6359476" type="CITY" weightage="100" keywordseo="Telenor">Telenor</keyword>, the Norwegian multinational telecommunications company that started its India operations in 2008, might soon be making an exit from the country, as its India telecom business hasn't been able to find a buyer so far. 
 
With no 3G or 4G services, the Norwegian telco silently stands in a corner, watching its rivals gaining spectrums as days pass, while Telenor has been confined to a few pockets. 
 
 
The Fornebu-headquartered company has spectrum in seven circles but out of 22 zones present in India, it operates in just six, with airwaves only in 1800 Mhz band. As of now, the company is said to be looking for a valuation between $1.6 billion and $1.8 billion (Rs 11,000-12,000 crore); however, experts believe that the best that it may be able to get is around $1 billion (Rs 6,800 crore), and the spectrum would be the main saleable asset. 
 
Ever since its debut, Telenor has invested over $3 billion in India, but to no avail. In fact, in 2012, it had even lost all its India licences, and Supreme Court annulling its licences among the 122 to tackle the 2G scam was a huge setback. 
 
As a ray of hope to survive in the world’s fastest growing mobile market, it has just deployed a technology that allows offering LTE mobile broadband on a narrow band of spectrum in Varanasi. By the end of this year, it plans to expand it to the six circles that it operates in. 
However, analysts are doubtful about the technology, saying that it has come too late for Telenor into the data market. 
 
<a href="http://www.digi.no/incoming/2015/01/28/telenor-fiber.jpg1/alternates/h1080/Telenor%20fiber.jpg">Image source</a>

8 years after its debut, and a year after its re-launch, 2G-struck Telenor might exit India citing limited presence

To expand its network in India, Norway-based <keyword id="6359476" type="CITY" weightage="60" keywordseo="Telenor">Telenor</keyword>'s Indian unit <a href="Uninor">Uninor</a> has signed a contract worth about $300 million with Chinese telecom gear maker <a href="http://www.businessinsider.in/searchresult.cms?query=Huawei">Huawei</a>, giving a three-year 2G network expansion and transformation deal. 
 With the help of this contract, <keyword id="1486742" type="CITY" weightage="100" keywordseo="Uninor">Uninor</keyword> also intends to make its 4G network available in six circles - Uttar Pradesh East, Uttar Pradesh West, <a href="http://www.businessinsider.in/searchresult.cms?query=Bihar+">Bihar</a> (including Jharkhand), <keyword id="37102" type="COMPANY" weightage="60" keywordseo="Andhra-Pradesh">Andhra Pradesh</keyword>, Gujarat and <a href="http://www.businessinsider.in/searchresult.cms?query=Maharashtra">Maharashtra</a>, reported the Economic Times. 
 As per the contract, <keyword id="6357456" type="CITY" weightage="80" keywordseo="Huawei">Huawei</keyword> would transform around 24,000 sites of Uninor in these six major circles in the country. 
 
So far the telco has been working with Finnish telecom gear maker <a href="http://www.businessinsider.in/searchresult.cms?query=Nokia+">Nokia</a> Networks for 2G service deployments in India. <keyword id="2441437" type="COMPANY" weightage="80" keywordseo="Nokia-Networks">Nokia Networks</keyword> currently deploying networks for Uninor's <keyword id="6354915" type="CITY" weightage="60" keywordseo="Assam">Assam</keyword> circle, which is likely to start operations anytime this year. 
 
Moreover, the same equipment from Huawei can further transform into 4G networks with some tweaks, once Uninor finalizes its plans to offers 4G services in India, according to the person familiar with the development. 
 
Earlier, Uninor has said that it will introduce more sophisticated services using 4G LTE technology. 
 
Once its permit is converted into a unified licence, Uninor can offer 4G services without buying more spectrum than what it already has in the 1800 MHz band. A unified licence allows airwaves to be used to offer any technology — 2G, 3G or 4G. 
 
Analysts are of the view that the ecosystem for offering 4G over the 1800 MHz band (FDD-LTE), which Uninor has, is far more developed globally than the 2300 MHz band held by some Indian telcos. 
 
Uninor provided services in more than 46 million subscribers using 2G technology in the country. It added 1.3 million subscribers during the second quarter ended June 30, and said the subscription base was 22% higher than the same quarter last year. 
 
The telco said 26% of the customers were active data users, and is targeting 50% Internet customers by 2017. 
 
Uninor recently posted total revenues at NOK 1,362 million (about Rs 1,064.63 crore) for the second quarter, up from NOK 1,021 million (about Rs 798.05 crore) last year. It also narrowed operating loss to NOK 90 million (about Rs 70.30 crore). 
 
(Image: Reuters)

Uninor inks a deal with Huawei to expand its network in India

Knowledge never comes for free! But cash strapped <keyword id="1486742" type="CITY" weightage="80" keywordseo="Uninor">Uninor</keyword> seems to be changing the norm. With its plans to expand and reach out to more customers across the country, Indian unit of Norway's <keyword id="6359476" type="CITY" weightage="80" keywordseo="Telenor">Telenor</keyword>, Uninor will be providing its customers with free access to <keyword id="71187" type="COMPANY" weightage="80" keywordseo="Wikipedia">Wikipedia</keyword>. 
 
Starting today, Wikipedia will be available for will be available for three months, according to a news report by The Economic Times. With the introduction of free Wikipedia and more such services in the pipeline, Uninor plans to have 50% of its users on the Internet by 2017, the company said in a statement. 
 
As part of the programme, Uninor employees will also engage with students and teachers to spread awareness on digital literacy with special focus on Wikipedia in the rural areas. 
 In 2012, Telenor committed to bring Wikipedia to its customers free of data charges through a partnership with the <keyword id="196610" type="ORGANIZATION" weightage="80" keywordseo="Wikimedia-Foundation">Wikimedia Foundation</keyword>. Following the agreement, free access to Wikipedia on mobile phones has been launched in Telenor business units in Bangladesh, Thailand, Malaysia, Myanmar and Montenegro. 
 
(image: india times)

Free Wikipedia, cash strapped Uninor’s ploy to get more customers on internet

The <keyword id="62528" type="ORGANIZATION" weightage="80" keywordseo="Department-of-Telecom">Department of Telecom</keyword> (DoT) is expediting <keyword id="6359803" type="ORGANIZATION" weightage="80" keywordseo="spectrum">spectrum</keyword> allocation and has issued a Letter of Intent (LoI) to <keyword id="188362" type="UNKNOWN" weightage="80" keywordseo="telecom-players">telecom players</keyword> in this regard. The <keyword id="1639" type="ORGANIZATION" weightage="80" keywordseo="Auction">auction</keyword> of air waves was held in March and the government received around Rs 1.1 lakh crore from sale in four bands- 800 MHz, 900 MHz, 1800 MHz and 2100 MHz. "As of now, we are expediting to allocate the spectrum which has already been auctioned this year... The Letter of Intent has been issued to all," <keyword id="46149" type="POSITION" weightage="60" keywordseo="Telecom-minister">Telecom Minister</keyword> <keyword id="6354886" type="PERSON" weightage="80" keywordseo="Ravi-Shankar-Prasad">Ravi Shankar Prasad</keyword> told PTI. 

	The government put around 470 MHz of spectrum for sale in the four bands and about 11% of the air waves remained unsold.
 

	The LoI also has the effective date for the spectrum. Eight telecom operators participated in the auction and except Uninor, all of them won air waves. The government got upfront payment of over Rs 32,300 crore from telecom players against the spectrum sold. This was way above the minimum outstanding due of Rs 28,835.34 crore.

	 
	(Image: Reuters)

DoT expedites spectrum allocation to telecom players, issues LoI

<keyword id="6354716" type="CITY" weightage="100" keywordseo="Nokia">Nokia</keyword> Networks clinched a dozen deals with major Indian operators during the first half of 2014 as against 16 signed last year, the company said. This signals better times for the Finnish telecom giant as it expects higher revenue from increased spend on data network expansion by carriers. 
 The Helsinki-based company has received a security solution contract from <keyword id="6354504" type="UNKNOWN" weightage="100" keywordseo="Reliance-Jio">Reliance Jio</keyword> Infocomm and a network expansion contract from Uninor, where Nokia will provide radio access equipment and accompanying services.

Nokia Seals 12 Key Deals With Indian Operators

<keyword id="6357073" type="ORGANIZATION" weightage="100" keywordseo="ITC">ITC</keyword> has replaced IT giant TCS as the country's most admired company, according to business magazine Fortune. ITC is followed by engineering and infrastructure major Larsen and Toubro (L&amp;T), Hindustan Unilever, Maruti Suzuki and <keyword id="13222" type="CITY" weightage="100" keywordseo="SBI">SBI</keyword> among the top five most admired companies in India. 
	The list in 2013 was topped by TCS, followed by <keyword id="44863" type="CITY" weightage="100" keywordseo="HUL">HUL</keyword>, ITC, <keyword id="6354512" type="CITY" weightage="100" keywordseo="Infosys">Infosys</keyword> and SBI in the top five. <o:p></o:p>

	The magazine said there are 19 new entities in the list, including GMR Infra, Shapoorji Pallonji, Idea Cellular, BSES Rajdhani Power Ltd (BRPL), Cognizant and Abbott Pharma.<o:p></o:p>

	In the sectoral rankings, NTPC ranks at the top position in the power sector, followed by Tata Power, BRPL, PowerGrid and BSES Yamuna Power. <o:p></o:p>

	In the telecom sector, Vodafone India is on the top, followed by Bharti Airtel, Idea Cellular, Tata Communications, Reliance Communications, Aircel, Tata Tele, MTNL, BSNL, MTS, Tulip Telecom and Uninor.<o:p></o:p>

‘ITC Is India's Most Admired Company’: Fortune

In the biggest ever spectrum auction that may fetch the government nearly Rs 1 lakh crore, <keyword id="15491" type="COMPANY" weightage="20" keywordseo="Airtel">Airtel</keyword>, <keyword id="15492" type="CITY" weightage="20" keywordseo="Vodafone">Vodafone</keyword>, <keyword id="6354924" type="PERSON" weightage="20" keywordseo="Idea-Cellular">Idea Cellular</keyword>, <keyword id="46907" type="CITY" weightage="20" keywordseo="Reliance-communications">Reliance Communications</keyword>, Aircel, Reliance Jio Infocom, Uninor and Tata Teleservices are the eight telecom companies which are competing to buy the second-generation or 2G and third-generation 3G radiowaves, as per a PTI report. 
 
The auction is scheduled to start from March 4. 
 However, <keyword id="83213" type="COMPANY" weightage="20" keywordseo="Sistema-Shyam-Teleservices-Ltd">Sistema Shyam Teleservices Ltd</keyword> (SSTL) cited high price and legal issues with the <keyword id="62528" type="ORGANIZATION" weightage="20" keywordseo="Department-of-Telecom">Department of Telecom</keyword> (DoT) to opt out of the auction. SSTL is a potential buyer of CDMA spectrum, On the other hand, Gurgaon-headquartered <keyword id="262458" type="COMPANY" weightage="20" keywordseo="Videocon-Telecom">Videocon Telecom</keyword> did not submit its application to participate in the auction, a PTI report revealed. 
 Currently, most of the spectrum that is available for the auction is held by Idea Cellular, Vodafone, <keyword id="107841" type="CITY" weightage="20" keywordseo="Reliance-Telecom">Reliance Telecom</keyword> and Airtel, and their licences are expiring in 2015-16. 
 
According to the PTI report, 9 circles of Mumbai-headquartered Idea Cellular, 7 circles each of Vodafone and Reliance Telecom, and 6 circles of Airtel are coming up for renewal. In total, there are 29 spectrum licences expire in 18 service areas in 2015-16. 
 
If these telecom firm wish to continues offering their services to the customers, it is mandatory for them to bid for spectrum. So it would be interesting to see who gets what on March 4. 
(Image: BCCL)

Eight telcos to compete in spectrum auction race

It seems that people over 50 years of age are not making use of present day technology. As per the data released by <keyword id="93456" type="COMPANY" weightage="80" keywordseo="Telenor-group">Telenor Group</keyword>, 6% of mobile users in India are over 50 years. 
 
Moreover, only 1% of total mobile internet users in India are over 50 years. 
 
Telenor Group released data from four Asian markets that indicated that senior citizens were not fully receiving the benefits of the mobile Internet. 
 
The research by the Group in four of its regional markets suggested that not all citizens in these societies were receiving benefits of connectivity. 
 
The study-‘The unconnected senior citizens of Asia’-drew customer data from four Telenor markets: India, Thailand, Bangladesh and Malaysia. The findings suggested that the senior segment in some of these markets represent as little as 2% of active mobile users, with still fewer using smartphones. 
 
A demographic breakdown showed that only 10% of Uninor’s subscribers in India were above 45 years. 
 
Meanwhile, of the total mobile phone users in India, only 6% are over 50 years of age. 
 
Sigve Brekke, Executive Vice President and Head of Asia operations, Telenor Group, said that it was matter of concern for Telenor as senior citizens were not availing services in their Asian markets. 
 
“The Internet can be a vital way of maintaining civic participation and even receiving basic citizen services in the near future, and thus the findings should be of interest to multiple stakeholders, from policy makers to corporations, families, and individuals. This is particularly true as several Asian societies anticipate increasingly aging populations: we must work to achieve connectivity for all, not just the young,” he said.

Shocking! Only 1% of people above 50 use Internet on mobilephones

India’s telecom arena is fighting an inner conflict of to be or not to be on the issue of <keyword id="6391709" type="UNKNOWN" weightage="60" keywordseo="Net-neutrality">net neutrality</keyword>. In this crucial juncture, <keyword id="15491" type="COMPANY" weightage="60" keywordseo="Airtel">Airtel</keyword> acted smart and introduced <keyword id="2796594" type="UNKNOWN" weightage="60" keywordseo="airtel-zero">Airtel Zero</keyword> yesterday where companies, including startups, can let users access apps for free. In effect, the app maker will pay for the customer's free usage to the operator. 
 
We have reported earlier that this will affect net neutrality. As per a news report in The Economic Times, this move has been severely criticized by the experts including Internet &amp; Mobile Association of India, whose spokesperson has said that, all apps should be made accessible to users on a non-discriminatory basis, not just a few. 
 In a bid to defend the same, Airtel's <keyword id="2798199" type="UNKNOWN" weightage="60" keywordseo="Director-for-Consumer-Business">Director for Consumer Business</keyword> Srini Gopalan told the ET, “No bandwidth is allocated whether an app is on Airtel Zero or not and there is no impact on performance of the app.” He said Airtel has worked with 10-20 apps, including large eCommerce players and smaller startups on the platform on a pilot basis over a couple of months, which has resulted in a 65% drop in the digital spending. However, Airtel did not divulge the names of apps or companies which have signed up for Airtel Zero. 
 
While discussing with the financial daily, some experts pointed out TRAI’s lack of guidelines on this kind of collaborations. While Airtel has planned this in a major scale, this is nothing new in the Indian telecom scene. 
 In February, <keyword id="46907" type="CITY" weightage="60" keywordseo="Reliance-communications">Reliance Communications</keyword> tied up with Facebook to launch internet.org in India, which provided access to 33 websites free of charge. In another instance, Uninor offered free usage of WhatsApp for Rs 1 a day and Rs 0.5 per hour for Facebook last year, and followed up with free Wikipedia for three months beginning April 1. This was another way of offering zero-rating plans, promoting unbridled access to the Internet, a senior executive had told the ET. 
 
A few days back, TRAI had floated a consultation paper on net neutrality, which implies that telcos cannot block certain apps or websites and promote a few. 
 
(Image: India Times)

Airtel is violating net neutrality and no one is liking it!

Finally the government is upping its ante against mobile operators over call drops, which have off-late become an irritant for Indian mobilephone users. 
 
The government is mulling to direct operators to return the money charged for the dropped calls or throw in extra airtime to compensate for deficient services. 
Indian users, who have emerged as the world’s second-biggest market, behind China, are vexed due to call drops. 
 
The service quality has been deteriorating due to low call rates and fast adoption of internet on mobile. 
 
"The idea is to ensure that a customer is not made to pay for a deficiency on the part of an operator," a key official in the telecom ministry told Times of India. 
 
The official added that the ministry was "working aggressively" on the issue, especially as call drops became a regular phenomenon in choked networks of metros. 
 <keyword id="2419779" type="UNKNOWN" weightage="80" keywordseo="telecom-minister-Ravi-Shankar-Prasad">Telecom Minister Ravi Shankar Prasad</keyword> has been raising the issue of call drops time and again. "Call drops need to be minimised. Private operators need to reinforce their mechanism. I have directed officials in the telecom department to work on a disincentive architecture (for the operators) to address the issue," Prasad said while speaking at a conference on completion of one year of the NDA government. 
 
The official source told TOI that the ministry also planned to rope in sectoral regulator TRAI on the issue. 
 
"We plan to find a solution soon. It could be as early as the next six months," the source told the news daily, without giving further details. 
 
TOI reported that TRAI’s customer satisfaction survey related to mobile services failed to recognise the issue of call drops and poor broadband connectivity. 
However, as per experts, making operators pay for call drops may not be that easy. 
 
"There needs to be a mechanism in place to recognize when a call is dropped due to network issues. Also, there should be a way to confirm this so that the customer is 
aware of the deficiency," a telecom industry expert told TOI. 
 
Meanwhile, operators blame the lack of adequate spectrum and problems related to erection of mobile towers for the growing network congestion and call drops. 
 
CEO of Bharti Airtel, Gopal Vittal, said that they faced a stiff resistance in installation of mobile towers and needed more spectrum to handle the additional traffic on mobile networks. 
 
But some mobile operators have decided to address the issue and are compensating customers for dropped calls. 
 
TOI reported that Anil Ambani's Reliance Communications doesn't charge a customer for the outgoing mobile pulse where the call gets disconnected due to network problems. Similarly, Uninor gives a minute of free talk time within 24 hours for disconnections during a call. 
 
(Image: Indiatimes)

Frustrated by call drops? Soon, mobile operators may compensate you for it

NEW DELHI: <keyword id="6354287" type="CITY" weightage="40" keywordseo="Bharti-Airtel">Bharti Airtel</keyword> could raise basic call rates for the first time in five years as it battles increasing input costs, a move that would make it the second major telco to do so after <keyword id="46907" type="CITY" weightage="40" keywordseo="Reliance-communications">Reliance Communications</keyword> raised them for prepaid users last month. 
 
On the back of a robust earnings performance by Bharti in the March quarter, this would strengthen the notion that the telecom industry is on firmer financial footing after a damaging tariff war in 2009-11. 
 
Analysts, however, said that while India's largest telco needs to raise call tariffs to improve its financial health, the scope of the increase could be limited as its two top rivals - No. 3 Idea Cellular and No. 2 Vodafone India - have clearly said they won't touch the basic rate, or the call rate without discounts, and are happy just cutting freebies offered to users. 
 "The fact is that these levels of voice pricing are absolutely unsustainable" with inputs costs going up, including those for rolling out <keyword id="50752" type="UNKNOWN" weightage="40" keywordseo="Networks">networks</keyword>, optical fibre, spectrum and diesel, Bharti Airtel's CEO for India and South Asia Gopal Vittal told reporters at a press conference. Diesel is needed to run generators at mobile tower sites. 
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"We have hitherto avoided taking headline tariffs (up) but at some point there may be an opportunity to raise headline tariffs," he said, adding however that the priority for the company remained reducing discounted minutes. 
 
Phone bills for postpaid users typically comprise basic call charges, also called headline rates, on which discounts such as free minutes are given to users based on their tariff plans. Prepaid users, who still make up over 95% of the mobile phone user base, typically get discount vouchers for a specific time period. 
 
By decreasing validity on prepaid vouchers, carriers force customers to use up talk time faster. By increasing headline voice tariffs, the minimum charge for a call paid by both prepaid and postpaid customers will rise. 
 
Higher rates allow operators to increase cash flow, thus allowing investments into improving networks and expanding operations. 
 
Several telcos have been quietly cutting discounts over the past three or four quarters, but have been leaving the basic rate untouched for fear of losing subscribers to competitors or smaller operators that offer cheaper tariff plans. However, the fourth-ranked Reliance Communications raised its headline tariffs in mid-April for prepaid customers by up to 20%, although it left postpaid headline rates untouched. 
 
Vittal's comments came a day after India's largest mobile phone company announced strong fourth-quarter results. Net profit jumped 89% from a year earlier on a 13.5% growth in revenue. 
 
While key parameters such as average revenue per user grew, the average realised rate from calls has been largely flat in the past two quarters, a trend seen in the Idea results as well, leaving some worried. 
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Analysts explained that while telcos, especially the major players, had been cutting discounts in circles where they are the leaders or the No. 2, they are loath to do the same, or have in fact given additional discounts, in areas where they aren't strong in a bid to attract or retain subscribers. Thus, the net effect on overall realised rates has been somewhat neutral to slightly lower in recent times. 
 
Realised rate is what a telco actually gets after all discounts and associated costs. 
 
Idea cut discounts last year, but this year in its weaker circles has once again leveraged pricing to acquire customers, CEO Himanshu Kapania said, due to which the overall realised rate was down by 2.5% across the country. 
 
"Over time we expect to fix that," he said, but ruled out raising basic rates. 
 
A Mumbai-based analyst said Bharti will be keeping a close eye on moves by Idea and Vodafone in the event of any move on headline rates. 
 
Vodafone declined comment but has said previously that it will work on discounts, without touching basic rates. 
 
To be sure, given that the industry seems to have put the tariff war behind it and is stabilising, the top telcos will eventually want to go ahead with increasing headline tariffs later this year, analysts said. 
 
The situation could change dramatically if Mukesh Ambani-owned Reliance Jio Infocomm enters the industry with a disruptive pricing offer. It's expected to launch voice and data services later this year. 
 
As things stand, "It's more of a do or die situation (for carriers) because this is the only industry which has seen the continuous downward movement of tariffs to a level that a per-minute call is cheaper than a glass of water," said Prashant Singhal, national telecom leader at Ernst &amp; Young. 
 
He expects headline tariffs to be higher by 15-20% by May 2015, though the increase would be gradual. "If headline tariffs are close to 60 paise per minute, the realised rate is around 30 paise, which is not sustainable," given the rising cost of operations. 
 
Bharti's strategy going forward is clear. It will focus on stripping out low revenue generating users, bringing in more postpaid customers who generate higher revenue and improve voice realisations, apart from investing in better data networks and driving cost efficiency, Vittal said. 
 
"With more rational competition, fewer competitors and rising data volume, I see headline tariffs going up marginally. I don't want to give a timeline to it but I don't see a reason why companies need to wait for a couple of quarters (to raise headline tariffs)," said Jaideep Ghosh, head of telecoms practice at KPMG. 
 Uninor, the Indian unit of Norway's <keyword id="6359476" type="CITY" weightage="40" keywordseo="Telenor">Telenor</keyword>, said it will take note of any changes in industry tariffs and take appropriate steps if needed. 
 <keyword id="6365707" type="CITY" weightage="40" keywordseo="UBS">UBS</keyword> believes Bharti Airtel's stock could be re-rated significantly over the next 12 months if mobile voice rates continue to go up, data consumption and revenue rises thanks to cheaper smartphones and the "regulatory outlook continues to improve".

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