Reliance and Bharti have strike deal on interconnect rates. As Ravi Prasad points out, this is probably the first sane Calling-Party-Pays regime in India. Now if only BSNL would follow suit… thankfully, there will now be quite a bit of pressure on them to do so.
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It is not true that cellcos have no niches left for them to compete over. If they’d only quit whining and look closer, they’d see that as basic operators see ever-thinner margins in their long distance business, they’ll have no choice but to raise local call rates (which was subsidized by long distance rates so far). Given that most cellcos (except Bharti) have no long distance business, and see a bulk of their income come from local and intra-circle calls, I’d say this would be a good hammer for them to hit basic operators with.
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It is difficult to find worse whiners in India today than the GSM cellcos. I’m writing this after laughing over this line in the Financial Express: Industry sources said the TRAI directive on interconnect came as a ’shock’ to the cellular industry last Friday and forced players to take it up with the regulator as a first priority. These are people who went into business with eyes wide open: they knew that
Well, now they have a velociraptor called Reliance in their midst, and it’s drawing blood without even coming starting to offer services. And they are surprised that the regulator is siding with the basic-service-providers? After all, the TRAI is merely interpreting the rulebook, and the rulebook says that cellcos have to offer interconnects to all basic providers. If the cellcos are discovering only now that the rulebook was so firmly stacked against them, then (if I was a cellco shareholder) I would raising cain about what the cellco legal eagles and due-diligence people were doing all this time.
Of course, the correct answer to that is they were playing a wink-and-nod game with their only ‘competitors’, BSNL and MTNL, comfortable in the knowledge that both was doing what they knew best — fleecing customers while providing substandard service.
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After about 2 weeks of bluster from Indian cellcos, the TRAI finally shows some backbone and asks them to stop selective interconnects or else. Of course, this will probably go to court, and in no small part due to the TRAI’s mulish refusal to at least try to implement a calling-party-pays structure for cellular calls.
More interestingly, Sunil Mittal announced yesterday that Bharti received approval to carry data on their i2i submarine cable on Friday: We have got the necessary clearances on transmission of data only last Friday and the consumers of bandwidth can expect some announcement in this week. Last month, I had written about how 160G of India’s total outgoing bandwidth of 900G is wasted on voice alone. Things will improve further if Dishnet can get its act together.
Of course, most of India’s data flow is to the US, so I don’t know what latencies will result in these Singapore-routed connections, but anything around 300ms will be good to have.
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Rediif: Mobile Users not impressed with new rate cuts. Sunil Mittal of Bharti Telecom clarified that the customers would have to pay charges for long distance call from cell to fixed line. … Ashim Ghosh of Hutch said that there was no question of offering free incoming calls. The GSM cellcos are still in denial. There are 42 million landlines in India (versus 9 million GSM cellphones). Creating a gated community of mobile GSM users will not help, especially as each CDMA user can interop with landlines seamlessly. What these people need to do is lobby to remove the interconnection tariff that they pay. And offer free incoming, no strings attached. (Britain’s 7-prefixed cell numbers is a good model, one knows one has to pay more to call the number). But considering these guys negotiating skills (heck, they can’t even decide termination charges so that they can offer cell-to-cell incoming free) I am not surprised they have made no headway with the TRAI so far.
On another note, I’m still waiting for BSNL and Bharti’s long-distance price-drop announcement.
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GSM Operators strike back, customers smiling: In a bid to compete with limited mobile services by basic service providers, cellular companies on Thursday announced a uniform mobile-to-mobile STD rate of Rs 2.99 per minute. Not good enough. Here’s what Airtel will have to do to retain me: 1. most important: free incoming - from landlines as well. 2. STD rates should be be 2.99/minute for all phones - including landlines. 3. Cheaper SMSes. Rs 1 per SMS sent doesn’t cut it anymore. And I don’t care what the COAI is whining about interconnect rates: if Reliance can lobby, so can you - go get those interconnect rates scrapped. But for God’s sake stop whining and try to deliver value to the customer for a change.
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Slate: The New Warren Buffett Way: from value investor to vulture investor.
With so many stocks having plummeted, so many companies beset by scandal, so much money fleeing the market, and such a crisis of investor confidence, one might expect that the classic value situations that are Buffett’s hallmark would be everywhere. Buffett should be grabbing an underpriced company every few days. The fact that Buffett, who has oodles of cash to put to work, hasn’t found many — and has instead been nibbling on distressed properties — shows just how overvalued stocks still are.
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From a letter I wrote to the Reg (in response to a post from Rishab Aiyer Ghosh):
a couple of years ago it was always indian ISPs that had to pay for access and didn’t get peering. now that the equation of revenue with bandwidth flow direction is pretty much reversed (i.e. india->us traffic actually implies more revenue to US sites, not just more demand from indians for them) there is a strong economic incentive for US companies to want traffic from india.
Even if Indian ISPs would like to charge for supplying traffic, they should _not_ be charging eBay et al — makes little sense: they should be approaching the carriers. I am pretty sure Ebay is not _dying_ to receive traffic from thousands of Indian users who drain bandwidth but hardly ever *buy* anything. Ditto the US operations of MSN and Yahoo. (Both have Indian operations — and I am pretty sure Yahoo India serves *it’s* content — including local ads — from Bombay.)
I wouldn’t be surprised, if, pretty soon, advertisers insisted on using RDNS lookups to only pay for users within specific geographic zones (for all I know, it could be happening already) — if I was advertising DIMMs on the Reg, I could say, I’ll only pay for hits from customers with the EU, US, and Canada. Or pay a lower rate for hits outside these zones. Some of this is already happening for some types of ads I’ve seen. This would kill Rishab’s argument that US sites see some perceived value from Indian traffic.
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GE to report stock options as expenses. MSFT would do well to follow CA’s and GE’s lead, waiting for compulsory regulation would not help them retain their image as a leader.
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Insightful slashpost on the /. technical interviews story. Basically those asking about why riddles at all in a software interview are missing the point. The point is not riddles for the sake of riddles; the point is to, in the brief span of time that an interview lasts, get some insight into the interviewees’ mental processes — especially when s/he’s faced with a (possibly stressful) situation unfamiliar to him before. Does he approach the problem with enthusiasm? Does he try to think through? Or does he tune out? (Tuning out is often a sign of jadedness — something most product companies cannot afford). I’d be more inclined to take a guy who gets things wrong but explores the problem space than a guy who clams up.
And oh, what works for me probably won’t work very well for you — there are at least five worlds in software development, and I think industry veterans can easily think up more.
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