8216;Policy changes causing havoc in telecom8217;

Changes in regulation proposed would hurt the industry irretrievably: Birla

Noting that the telecom industry is going through an uncertain regulatory phase,top industrialist Kumar Mangalam Birla has said the proposed changes in regulations and policy framework are causing havoc in the sector.

Birla,who heads leading business conglomerate Aditya Birla Group that is present in telecom business through Idea Cellular,said the proposed policy changes towards spectrum auctioning,pricing and refarming bode ill for the sector.

8220;8230; the changes in regulation proposed would hurt the industry irretrievably. It remains to be seen what shape regulation will actually take. Regulatory and policy change are causing havoc in the sector,8221; he said.

8220;Regrettably,the telecom sector is going through a phase of uncertain regulatory environment,8221; he said,while listing out the performance of various businesses in his annual letter to the shareholders of Aditya Birla Nuvo Ltd,a holding company for the group8217;s telecom,fashion and apparel,financial services and manufacturing businesses.

Birla,however,exuded confidence that 8220;Idea will emerge stronger,consolidate its position in the voice market and participate aggressively in the evolving wireless broadband business.8221;

He said Idea Cellular8217;s performance has been 8220;all the more creditable when set against the unprecedented stress and uncertainty running through the sector.

8220;Idea posted an impressive performance,recording a growth rate that is nearly twice that of the industry.

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8220;Idea is now among the select club of mobile operators globally with 113 million subscribers. It is the 8th largest operator in the world carrying 1.4 billion minutes of voice calls every day,8221; he said.

As per Aditya Birla Nuvo Ltd8217;s annual report for 2011-12,telecom business accounts for about 23 per cent of its revenue and 28 per cent of operating profits.

Also,Idea accounted for 20.6 per cent of the industry8217;s incremental mobile revenue during the calendar year 2011 and has been the biggest revenue market share gainer in the past two years.

It ranks first or second in eight service areas in terms of revenue market share.

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Idea commands a market value of USD 6.5 billion and annual revenue of USD four billion Rs 19,500 crore.

A total of 122 mobile licences,granted by the Department of Telecommunications in 2008,and the subsequent allocation of spectrum were quashed by the Supreme Court through an order in February,2012.

Idea and erstwhile Spice Communications which was later acquired by Idea were issued nine and four licences respectively in January 2008 which have been cancelled following a Supreme Court order.

Of the 13 licences,seven are being operated by Idea and balance six overlapping licences have been impaired since then.