Transcript Situation before IP1 Providers

INDIA’S TOWER & INFRASTRUCTURE
PROVIDERS INDUSTRY
TOWER AND INFRASTRUCTURE PROVIDERS ASSOCIATION (TAIPA)
December 23, 2010
Contents
I.
II.
III.
IV.
V.
Who we are,
Role Played by the Telecom
Infrastructure Sharing Industry,
Government’s position on “Sharing”,
Telecom Infrastructure Industry can
contribute more…,
Issues and the Way Forward.
1/11
I. Who We Are – An Introduction

We own and deploy telecom infrastructure for use by wireless and
mobile operators,

Enable optimal sharing of telecom infrastructure & have invested over
Rs. 75,000 Crores i.e. Over 60% of total Network investment,

Provide a neutral platform which is operator and technology agnostic,

Critical for efficiency and speed of rollout ,


Our Business Model is linked to objective of sharing – we only make
profits when sharing is achieved – currently in losses as an Industry.
Second largest consumer of Diesel after Indian Railways.
2 / 11
Situation Before Tower Sharing

Operators Built Expensive Towers for Own Use

Roll Out was Slow and Expensive

Towers Used to Barely Half its Capacity

City Skyline Had More Towers

Customer Tariffs were higher
3/11
II. Role played by Tower & Infrastructure
Providers

Promote efficiency by

saving cost and time

enabling scale

ensuring highest uptime at lowest Capex/Opex,

Beneficiaries include operators of cellular, broadband, radio trunking
and other wireless services,

Now rolling out broadband infrastructure for 3G Operators &

Proposed new models ensure viability of rural common service centres
(CSC) & clean energy.
4/11
Benefits of Organized Tower Sharing

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
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Service Access: Faster Rollout,
Economics: More efficient Use of
Capital,
Competition: reduced cost of entry
and operations for new entrants,
Aesthetics: Reduce Tower
Proliferation
Quality of Service: Better coverage
quality.
Safety: players have incentive to
follow prescribed norms
Standardization: by using IIT/TEC
designs for Towers
5/11
III. Tower Sharing Not Only Desirable But
Also Represents Government’s Position

Allows Industry to optimize cost and make Telecom/Broadband services affordable
services to the “Aam Aadmi”

Protects Environment & Energy savings

Improves Aesthetics

Enhances Safety

Protect Consumer interests
DOT’s Earlier Initiatives – 2005-2007:

USO funds for Sharing

Project Mobile Operator’s Shared Towers (MOST)
TRAI’s Earlier Initiatives - 2007


Financial Incentive to Promote Infrastructure Sharing

Joint Working Groups(JWG)
TRAI’s Recent Recommendation- 2010

Further optimization of Telecom Infra Elements
6/11
IV. TAIPA members and
DOT/USOF/DIT/MNRE are natural partners



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
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Uniquely focused on bottleneck infrastructure,
Determined to tackle environmental issues with Green Energy & thereby
reduce Diesel and Kerosine consumption.
Making the largest share of investments with little or no returns in the short
run,
Have motivation to cover remote and rural areas & provide broadband to
remotest parts of country.
Can cover several areas/people who would otherwise wait indefinitely for
Broadband and basic telecom connectivity.
Uniquely positioned to partner with Government Agencies to :



Provide surveillance services for security checks and traffic control
Phone charging stations in rural areas
Community Emergency Lighting in rural areas in case of power-cuts.
7/11
V. Issues

However, instead of encouragement, we are constantly harassed.

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Incessant harassment by Local Authorities by treating us as ‘cash
cows; with adhoc and unreasonable demands of levies and
recurring charges.
Have been regularly subjected to adhoc sealings in different
parts of country on frivolous grounds.
Even DOT levies ‘Testing Charges’.
TRAI has recently suggested levy of License Fee on Tower
Companies.
8/11
Implications For Consumers & Society

Possible Higher Tariffs

Slower Rollout of Communication
Services

More Towers than Necessary because of
less sharing

More Pressure On Environment

Threat to Skyline
9/11
The Way Forward

Reject proposal to levy License Fee

Not legally tenable as License Fee can only be levied on service providers covered
under Indian Telegraph Act and not ‘supporting services’.

If levied, should also be levied on equipment suppliers, diesel suppliers, electricity
companies, steel & cement companies etc.

In any case, if levied should be allowed as deduction from AGR to operators.

Need for National Infrastructure Policy
Recognising Tower Infrastructure as ‘Critical Infrastructure’

Priority of permissions – single window clearances.

Priority for EB supplies at most favourable rates.

Uniform policies on levies, if any.

No adhoc sealings.

Use USO fund for Towers in Rural Areas.

Subsidies for Alternate Green Sources of Energy – e.g, solar, fuel cell & DCDG.
10/11
We recognise difficulties and limitations on part of
DoT in implementing some of the above.

We do recognise that DoT may not be able to direct some of
the above due to legalities because of “state subjects” or
involving other ministries like MRNE (Ministry for Renewable
Energy).

National Infrastructure Policy, therefore may take sometime.

Would atleast request DoT to atleast make recommendations
by way of a suggested Uniform Infrastructure Policy to states
and others concerned and be a partner with TAIPA to present
our legitimate case.
11/11
Thank You
TOWER AND INFRASTRUCTURE PROVIDERS ASSOCIATION (TAIPA)
23 December 2010