NTT DoCoMo seeking more Indian telecom assets
25 October 2010
Japan's NTT DoCoMo, along with its partner Tata Teleservices, will buy other Indian telecom operators for their assets, not subscribers, once the regulatory framework becomes conducive to telecom consolidation, Mutso Yamamoto, executive director and head of strategic alliances of NTT DoCoMo, said on Sunday. ''They have the ability to increase subscribers. So, assets like spectrum will be more important in my opinion,'' Yamamoto told journalists.
India currently has 14 telecom operators, compared with three or four elsewhere in the world. Late entrants in the global system for mobile communications, or GSM, platform like Tata DoCoMo have merely 4.4 Mhz of radio bandwidth. ''In Japan, we have 45Mhz of spectrum,'' Yamamoto said.
Most industry participants agree consolidation is imperative in the sector, but acquirers await final regulations on the fees the government will charge in transactions. A proposal by the Telecom Regulatory Authority of India (TRAI) says it will charge fair value for all spectrum acquired in a transaction. ''Current recommendations are against consolidation,'' Yamamoto said.
The Japanese company is committed to the Indian market, he said - so much so that if circumstances force it to exit Tata Teleservices, it will consider investing in another Indian telecom company. At present, however, there is no reason to believe that will happen. ''They (TTSL) have exceeded all our expectations in adding subscribers and base stations.''
NTT DoCoMo bought 26-per centin Tata Teleservices in 2008 for $2.7 billion (See: DoCoMo to buy 26 per cent in Tata Tele for $2.7 billion). The Japanese company specialises in third-generation, or 3G, services which it anticipated would come to India soon at the time it bought stake.
At present, the quality of network and improving the range of data services are the two key targets NTT DoCoMo sees for Tata Teleservices, Yamamoto said. ''We would like to see Tatas do better relative to the competitors.''