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Sunil Bharti Mittal<\/a>, chairman of global telecom body GSMA<\/a>, said that his strategy for improving the financial health and credibility of the industry<\/a> worldwide rests on four pillars — deepening active sharing by pooling spectrum in a separate company run by a third party; more consolidation; a change in the attitude of governments towards telecom; and abolishing roaming charges while improving transparency in billing. Mittal, chairman of India’s largest telco Bharti Airtel<\/a>, told ET that despite billions of dollars in annual investments, the industry was being valued at levels similar to utility companies. Mittal is in Barcelona for the Mobile World Congress<\/a>, where he delivered the keynote address. Edited excerpts:\n
\nWhat is your vision\/strategy for the global telecom industry?<\/strong>
\nI will use four pillars to outline my strategy – credibility\/reputation, time for a netco (network company), consolidation and change in the attitude of governments towards telecom.
\n
\nCan you elaborate?<\/strong>
\nThis industry invests a massive amount of money, roughly about $200 billion in networks a year globally. Besides, about $50-60 billion goes into spectrum annually. The density of expenses in terms of capex, spectrum is going up whereas revenue is tapering off, which is putting a massive amount of pressure on RoCE (return on capital employed) of this industry, which has lost its appeal to investors. We are down to an average multiple of about six and a half, which is usually what utility companies get, where you put up a plant, and you don’t invest anything more other than that on repairs. Here, around 20% of the revenue go into capex, so this is not a utility. So, what is happening? Firstly, it is the credibility, reputation of this industry which has massively suffered.
\n
\nWhat is going wrong?<\/strong>
\nFirst and foremost is roaming, which is the biggest bugbear of this industry. In our (India) case, we have domestic roaming as well but internationally, people go out with the fear of even opening their phones. We, as an industry, should work on reducing international roaming (charges). Airtel will do away with India roaming from April 1. We will also make international roaming bills shock free. The (Indian) government should get rid of the 22 circles, just make it one India, one network. The second part is that people all over the world feel that billing lacks transparency and clarity. This has to change, globally. We are moving towards bundled plans. So, simplicity of billing is needed. Third, content also has a lot of charges. They must also be part of key bundles and what is not part of the bundle must be clearly spelled out. Different charges for content could be a problem in India, which has barred discriminatory pricing of data. These are not global issues at all. Eventually, India will have to align with the world. It (bar on discriminatory pricing of data services) should go away.
\n
\nHow can RoCEs of telcos improve?<\/strong>
Time has come for setting up network operating companies (netcos). The current system of building networks for each operator needs to be completely dismantled. Some progress has been made in towers. The best progress has happened in subsea cables, almost all of which are under consortium. But fibre is still far behind on the ground. In India, Tata, Vodafone, Jio, BSNL<\/a> have their own and, on top of it, BharatNet is coming.
\n
\nFar too much wastage is happening and no wonder RoCEs are low. Every fibre must be built in a consortium.<\/strong>
\nNetcos and mobile companies should separate themselves. Spectrum should be pooled in a netco. You build one massive network from which everyone is served. Benefit is that it is not just lower investment in capex but your spectrum efficiency rises significantly. The need for base stations is halved immediately. Everybody will not come together, but my views are: they should... at least two must build, ideally three. So, I say time for a netco has come.
\n
\nIn this netco, fibre, spectrum and towers will all get combined?<\/strong>
\nPassive side can be separate, the active side should be network. It could be like towers where everybody comes and co-builds. An independent third-party netco has to come and run it which has a clear method of charging per MB per minute or whatever. The job of that is of a utility. Then we (telcos) become digital companies, providing content. We will be true marketing companies. India doesn’t allow it yet.
\n
\nHow will government react given a lot of revenue comes from spectrum?<\/strong>
That is the fourth point. What do they (governments) want? A digital nation or spectrum auction and money? Governments need to start looking at industry in a very different way. You need massive consolidation in the sector. In 2008 when we (India) took from five to 12 operators, the idea was that they will serve customers better. But investments in network slowed. Videocon<\/a>, MTS<\/a> are gone. Aircel and RCom will merge. Now, with Vodafone and Idea, looking at just for India, $25 billion of hard investments blown off in smoke. If we had three private sector companies with BSNL, solid, viable, strong balance sheets, India would have accelerated its rollout, invested more in capex and consumers would have enjoyed the benefits of competition. US has stopped Sprint and TMobile merger, which should have been encouraged.
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\n5G is coming in the next two-three years. You want strong balance sheets. Governments and regulators have enough powers in their hands to intervene should they see any extra profit-making tendencies of any of the operators. On one hand they (government and regulator) want more innovation, on the other, they want the highest taxes. Governments should therefore decide — should they milk this sector or should they support the sector with various forms of incentives?
\n
\nWhich of your pillars do you expect will face the most challenge?<\/strong>
\nNetco will be one big challenge because governments will have to change all their policies. Spectrum sharing is now allowed, but even now there are many restrictions. Such restrictions, which are exclusive to India, must go.\n\n<\/body>","next_sibling":[{"msid":57384549,"title":"Telecom companies should form separate entities to pool spectrum: Sunil Bharti Mittal","entity_type":"ARTICLE","link":"\/news\/telecom-companies-should-form-separate-entities-to-pool-spectrum-sunil-bharti-mittal\/57384549","category_name":null,"category_name_seo":"telecomnews"}],"related_content":[],"seoschemas":false,"msid":57384628,"entity_type":"ARTICLE","title":"Time has come for setting up network operating companies: Sunil Bharti Mittal, Chairman, GSMA","synopsis":"\"Netcos and mobile companies should separate themselves. Spectrum should be pooled in a netco. You build one massive network from which everyone is served.\"","titleseo":"telecomnews\/time-has-come-for-setting-up-network-operating-companies-sunil-bharti-mittal-chairman-gsma","status":"ACTIVE","authors":[{"author_name":"Romit Guha","author_link":"\/author\/479232631\/romit-guha","author_image":"https:\/\/etimg.etb2bimg.com\/authorthumb\/479232631.cms?width=250&height=250","author_additional":{"thumbsize":false,"msid":479232631,"author_name":"Romit Guha","author_seo_name":"romit-guha","designation":"Correspondent","agency":false}}],"Alttitle":{"minfo":""},"artag":"ET Bureau","artdate":"2017-02-28 08:28:13","lastupd":"2017-02-28 08:31:30","breadcrumbTags":["Videocon","Sunil Bharti Mittal","industry","BSNL","Bharti Airtel","Interviews","MTS","mobile world congress","GSMA","MWC2017"],"secinfo":{"seolocation":"telecomnews\/time-has-come-for-setting-up-network-operating-companies-sunil-bharti-mittal-chairman-gsma"}}" data-authors="[" romit guha"]" data-category-name="" data-category_id="" data-date="2017-02-28" data-index="article_1">
苏尼尔•巴帝•米塔尔全球电信董事长的身体GSMA说,他的策略改进的财务状况和信誉行业全球基于四大支柱——深化主动共享池光谱在一个单独的公司由第三方;更多的整合;改变政府对电信的态度;,取消漫游费同时提高收费的透明度。米塔尔,印度最大的电信的董事长Bharti Airtel等表示,尽管每年数十亿美元的投资,该行业被类似于公用事业公司价值水平。米塔尔在巴塞罗那全球移动大会,他发表了主题演讲。编辑摘录:什么是你的视力/全球电信行业战略?
我将用四个支柱来概述我的策略——信誉/声誉,时间netco(网络公司),整合和政府对电信的态度的变化。
你能详细吗?
这个行业投资大量的资金,在全球每年大约2000亿美元的网络。此外,每年大约50 - 60美元进入光谱。费用的密度在资本支出方面,光谱是收入上升而逐渐减速,这是把大量的RoCE压力(已动用资本回报率)这个行业,它已经失去了对投资者的吸引力。我们平均下来约6的倍数,这通常是公用事业公司,建了一座工厂,和你不投资比在其他任何维修。在这里,大约20%的收入进入资本支出,所以这不是一个效用。那么,发生了什么?首先,这是信誉,这个行业的声誉严重受损。
什么错了吗?
首先是漫游,这是这个行业最大的怪物。在我们(印度)的情况下,我们有国内漫游,但在国际上,人们出门的恐惧甚至打开手机。作为一个行业,我们应该努力减少国际漫游(指控)。Airtel将从4月1日废除印度漫游。我们还将使国际漫游费用冲击自由。(印度)政府应该摆脱22圈,只是使它成为印度,一个网络。第二部分是,全世界的人都觉得计费缺乏透明度和清晰。在全球范围内,这必须改变。我们正在向捆绑计划。所以,简单的计费是必要的。 Third, content also has a lot of charges. They must also be part of key bundles and what is not part of the bundle must be clearly spelled out. Different charges for content could be a problem in India, which has barred discriminatory pricing of data. These are not global issues at all. Eventually, India will have to align with the world. It (bar on discriminatory pricing of data services) should go away.
中华民国的电信公司如何改善?
时候设置网络运营公司(netcos)。当前系统为每个操作符需要构建网络完全拆除。取得了一些进展。最好的进展发生在海底电缆,几乎所有的财团。但纤维仍远远落后于地面上。在印度,塔塔、沃达丰、Jio,BSNL有自己的,在上面BharatNet即将来临。
太多的浪费正在发生,难怪民国很低。每个纤维必须建在一个财团。
Netcos和移动公司应该自己独立。netco频谱应该汇集。你建立一个庞大的网络,每个人都是。好处是,不仅仅是降低投资资本支出但你频谱效率显著提高。需要基站立刻减半。每个人都不会在一起,但我的观点是:他们应该…至少两个必须建立,最好是三个。所以,我说时间netco已经到来。
netco,纤维、频谱和塔都将得到组合?
被动方可以单独,活动方应该网络。它可以像塔,每个人都是和共建。一个独立的第三方netco来运行它,有一个明确的方法,每分钟每MB或其他收费。一个实用的的工作。然后我们成为数字公司(电信),提供内容。我们将真正的营销公司。印度不允许它。
政府将如何反应给很多收入来自谱吗?
这是第四个点。他们(政府)想要什么?数字国家或频谱拍卖和钱吗?政府需要开始看行业在一个非常不同的方式。你需要大规模整合。2008年当我们(印度)从5到12个运营商,他们的想法是,他们将更好地为客户服务。但在网络投资放缓。Videocon,MTS已经一去不复返了。Aircel和信实电信将合并。现在,沃达丰(Vodafone)和主意,看印度,250亿美元的投资吹烟。如果我们有三个私营公司BSNL,实心的,可行的,强大的资产负债表,印度会加速其推广,投入更多的资本支出和消费者将享受竞争的好处。我们已经停止Sprint和TMobile合并,应鼓励。
5 g即将在未来2 - 3年。你想要强劲的资产负债表。政府和监管机构有足够的权力在他们的手中干预他们应该看到任何额外获利倾向的运营商。一方面他们(政府和监管机构)想要更多的创新,另一方面,他们想要最高的税。政府应该因此决定——他们应该牛奶这个部门还是应该支持部门和各种形式的奖励吗?
你的支柱,你希望将面临最大的挑战?
Netco将是一大挑战,因为政府将不得不改变他们的政策。频谱共享是允许的,但即使现在有很多限制。这些限制,独家向印度,必须去。
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