Vodafone has claimed that Tata Tele and RCom were paying far less spectrum charges to the government compared to itself and Bharti Airtel
Mobile operators are clashing yet again over the fee paid for spectrum (airwaves) with Vodafone claiming that Tata Teleservices Ltd (Tata Tele) and Reliance Communications Ltd (RCom) were paying far less to the government—a charge denied by the two companies, reports PTI.
"The allegation of the incumbent (Vodafone) is illogical, baseless, misleading and a blatant attempt to divert the focus from the real issue, which is that the incumbent and other players are hoarding spectrum beyond the contracted amount of 6.2 MHz and not allowing other players to start services in Delhi," a Tata Tele spokesperson said.
Vodafone, one of the largest GSM operators, had said that service providers like itself and Bharti Airtel pay the highest spectrum charges per MHz to the Department of Telecom (DoT) compared to others. “For example, the rate per MHz per quarter for Bharti and Vodafone for seven circles is Rs1.71 crore and Rs1.37 crore, respectively.
"As compared to this, the rate paid by Tata Tele and RCom is only Rs0.27 crore and Rs0.22 crore,” Vodafone's resident director TV Ramachandran has said in a letter to DoT asking it to remove such distortions.
The rivals, however, called the allegation “absurd” and said that Vodafone has compared payment of spectrum usage for seven circles including metros and it would be very misleading to compare these circles where the incumbents have been operating for many years and have revenues far exceeding players like Tata Tele and RCom and other new players in the GSM mobile-platform space.
Upset by what it called “Vodafone’s misleading calculation”, one of the new operators said: "It seems they (incumbent operators like Vodafone) have decided not to allow any new player to survive in the market."
The spectrum fee has been a bone of contention among existing and new operators.
"Somewhere, amid all the allegations our competitor has made, it has forgotten to mention that we have paid the entry fee of Rs1,650 crore twice," Tata Tele said, adding that "We (Tata Tele and RCom) are paying double the charge for both CDMA and GSM technologies."
Anil Ambani-led RCom said that old operators like Vodafone have revenues far exceeding RCom and they are paying fees as a percentage of adjusted gross revenue. In many circles, where RCom has more revenues their spectrum fees to the government is higher than Vodafone. It is absolutely “absurd” the way Vodafone has tried to “mislead” the government, RCom said, alleging that this was done with a view to keep the spectrum hoarded by players like Vodafone and not allowing new players to compete.
It is to be noted that some of the dominant operators are said to be holding in excess of over 10 MHz of spectrum across circles beyond the contracted limit of 6.2 MHz, without paying for the difference. This itself should fetch the government over Rs20,000 crore at market price.
The road & transport ministry has an ambitious plan of building 20 kilometres of road per day. RPN Singh, minister of state (MoS) for road & transport speaks with Moneylife’s Aaron Rodrigues about the ministry’s plans
Aaron Rodrigues (ML): Do you think that the road targets set out for FY10 can be met?
RPN Singh (RS): They (the road targets) are definitely possible; we wouldn’t have set out the targets (otherwise). We had planned to make 20 kilometres of road per day when we came into government in May. We have begun this ambitious plan. Earlier, we were making two kilometres per day, when we took over the ministry in May—my senior minister (Kamal Nath, minister for road & transportation) and I came out with a work plan of 12,000 kilometres of roads, which entails about $2 billion of expenditure. The government doesn’t have that kind of money, so we are going to be doing it through a build-operate-transfer (BOT) toll. Around 60% of our total plans are going to be (based on the) BOT toll module.
ML: Do you think that private companies will match up with the rapid road-addition plans of the government?
RS: We do believe that private players will match up (to our plans). Our ministry is planning to launch a public-private partnership project. In fact, the concessionaires and contractors have had some misgivings about the model concession agreement (MCA) which was the way the bids were called for. The prime minister recommended that we tweak the MCA. There was a panel set up by PK Chakravorty, which looked into the matters and problems faced by concessionaires and private players, and we changed the process of inviting tenders. Mr Chakravorty gave his suggestions which were accepted by the Cabinet and (they have) already been put into play. This has lead to great participation by private players in our projects. In fact, all of our projects have been taken up on the BOT toll module.
ML: What is the status on the agreement with the Malaysian government to build roads in India?
RS: We are not having any kind of deals with any government. We are getting it (our investments) through public partnerships and foreign investment. My senior minister has conducted road shows all over the world regarding how the country is looking to get its funding even from abroad, and we are quite certain that we will get a lot of money coming in from external sources.
ML: Do you see an improvement in land acquisition after the setting up of special land acquisition units?
RS: We are just compiling all the exact figures of the land acquisitions in the period since we took over from May (2009). We have put up 10 units in (various) states, out of which 192 special land acquisitions in the country (are) already underway. In a larger context, compared to the land that was acquired during the last four years of the first United Progressive Alliance (UPA) government, we have in the last six months acquired double that amount of land or are in the process of acquiring the same. But we still need a quicker way of getting land and we are looking at making the process more proactive.
ML: Have any new projects been identified for road development?
RS: My senior Cabinet minister is working on expressways. There will be a separate expressway authority. So we are looking into expressways which our country needs. We are also looking into mega-projects which need huge investments, where not only Indian private contractors will be involved, even people from overseas would come in.
ML: Are there any new updates on the pilot project to be initiated on the automatic toll concession systems proposed to be implemented on Indian roads?
RS: We have got some pilot projects going on. We will be looking at them and also look into the possibilities where there is connectivity from one place to another. There are four-five (automatic toll concession) systems in the world, out of which three are suitable for our country.
The developer has claimed sales figures in the third quarter of this fiscal which are almost equal to the sales figures of entire Hyderabad city for the same period
Real-estate developer Lodha Group claims to have sold approximately 4,000 units in the third quarter of FY10 according to industry analysts. Ironically, the sale reported by the developer is equal to the figure reported by entire Hyderabad city in this quarter.
Lodha’s numbers have been questioned by industry experts. Earlier in 2007, the group launched a luxurious residential complex named ‘Lodha Aqua’ at Dahisar in suburban Mumbai.
The developer claimed that on the very first day of the project launch, it sold 300 units at Rs5,850 per sq ft (comprising two bedroom, hall & kitchen (BHK), with an area of 1,017 sq ft and 3BHK with an area of 1,395 sq ft). In December 2009, the group jacked up the price for the project to Rs6,399 per sq ft. However, in 2010, the developer is aggressively advertising the same project as a fresh one.
If the developer has already sold 300 units on the first day of the launch three years back, why is the company spending so much on advertising? The group is busy coming out with full-page advertisements and is booking prime advertising time on various channels to promote the project. Moneylife sent an email to the company on the issue. However, it remained unanswered until Monday evening.
During the third quarter to end-December, the real-estate industry has reported sluggish sales in Mumbai. In Mumbai and Delhi, the major real-estate markets in the country, there has been very little movement during the quarter. “Rents in the NCR further depreciated to reach their lowest level in the past two years, which also provided an impetus for corporates to lock in leases at existing rents,” said Jones Lang LaSalle Meghraj in a report.
Despite the quarter falling in the festival period, Mumbai reported lower sales as developers spiked prices. The increased property prices made actual end-users withdraw from the market. According to an industry expert, during the third quarter, property sales in Mumbai fell by around 20% compared with the previous quarter.
Most of the real-estate companies that faced a severe liquidity crunch in September 2008 have raised funds and de-leveraged their balance sheets. A spate of events since January 2009, starting with an RBI debt-restructuring package for real-estate companies, asset sales and fund-raising from capital markets have alleviated the liquidity concerns for the sector.
“Amid a slow revival in the residential segment and a nascent commercial space recovery, we are underweight on the real-estate sector over the medium term. Though liquidity has improved for real-estate players, growth and valuations remain a concern in (the) medium term,” said ING Investment Management (India) Pvt Ltd, in a report.
With ample availability of funds, realty developers did not bother to cut property prices as expected by the central bank. This has resulted in erratic monthly sales. The sector showed signs of some recovery after July 2009. However, after that, sales dropped due to stiff property prices. The zigzag movement of real-estate sales is slowly mirroring the situation in 2008, when it was hard to report sales by the industry, concluded an industry insider.