Telecom Companies Cross 100-Crore Mark, But Call-Drop Spoils Party In 2015

Telecom operators Reliance CommunicationsBSE 2.09 pct and loss making Sistema Shyam Teleservices were able to benefit under new the norms by signing a merger deal.

Spectrum trading guidelines announced in October provided exit option to telecom operators. Videcon Telecommunications was quick to capitalise on it.

The company was able to sell its airwaves in Gujarat and Uttar Pradesh West for 3,310 crore to Idea Cellular which it purchased for 1,329 crore in November 2012.

In 2016, consolidation can also emerge as a big play in the sector.

E&Y feels that telecom operators have their eye set on spectrum that can help them expand their 3G and 4G services but they may not be ready to buy most premium airwaves in 700 Mhz band.

"Although 700 MHz is a globally harmonised band for 4G, the industry may not be ready for it given the ecosystem is not fully developed and is expected to be highly priced. It is essential to develop an effective roadmap for the efficient use of spectrum that supports the creation of a Digital India," Sachdeva said.

Though big data volumes are expected to come from urban centres, telecom operators will look at firming their strategy for rural market where teledensity is low but growing.

Telenor India Chief Operating Officer Tanveer Mohammad said that the next wave of data growth will come from rural areas where the Internet penetration there is less than 15 per cent in a population of 922 million.

"Though the mobile phone penetration in rural India is around 42 per cent, the mobile internet penetration is less that 10 per cent. This presents a good opportunity to innovate and come with services that are useful for our those the rural and semi-urban areas," Mohammad said.