Anil Takes Over As Chairman Of Reliance Infocomm

[Arun 795]

Anil takes over as Chairman of Reliance Infocomm

Press Trust of India

Mumbai, June 26, 2005

Anil Ambani, who took over as Chairman of Reliance Infocomm, today reconstituted its Board after the elder brother Mukesh resigned as Chairman along with five other directors.

The details of the reconstituted Board were not immediately available.

The five directors who resigned from the Board are Anand Jain, Manoj Modi, Bharat Goenka, Y P Trivedi and M P Modi.

Anil had got Infocomm as part of ownership settlement of the Reliance empire between him and Mukesh.

Two of the directors -- Y P Trivedi and M P Modi -- were inducted in the Infocomm Board on December 27 last year at the height of the battle between Anil and Mukesh.

Anil, who met Communication and IT Minister Dayanidhi Maran last week, is expected to hold a review meeting with the top executives during the day.

Anil, who created Anil Dhirubhai Ambani Enterprises as a distinct entity from Mukesh controlled Reliance, may also unveil a roadmap for Infocomm's future and may give some indication about a possible public offering in the company.

A day after the settlement, Anil had told reporters that listing of Infocomm would be considered in due course of time.

With an employee strength of over 40,000 and a revenue of over Rs 5,000 crore, Infocomm is still considered a money guzzler and would require substantial investment for its complete roll-out plants.

Anil Ambani on Sunday took over the reins of Reliance Infocomm, the Reliance Group's flagship telecom firm which he got as part of the settlement of Rs 100,000 crore group.

Anil, flanked by mother Kokilaben, wife Tina, sisters Nina and Dipti and their husbands along with the five children, and his two sons, took over as the Chairman of Reliance Infocomm at the company's headquarters at sprawling Dhirubhai Ambani Knowledge City (DAKC) in Navi Mumbai.

The younger of the two Ambani scions, who, besides Reliance Infocomm, got Reliance Energy and Reliance Capital as part of the settlement with brother Mukesh, performed puja at a temple in the DAKC and walked to the company headquarters to take charge of the company.

[anujit 0]

Question really is whether we're going to see if there will be any changes in the way Infocomm is run.

Whether they are going to lie/cheat/steal with the public and the govt. Or will it try to be more honest and up front in what they do and say!

[Puneet 0]

Reliance Infocomm Ltd., a Reliance group company, is India's largest private telecom service provider with a subscriber base of over 11 million. Reliance Infocomm has established a pan-India, high-capacity, integrated (wireless and wireline) and convergent (voice, data and video) digital network to offer services spanning the entire Infocomm value chain - infrastructure, services for enterprises and individuals, applications and consulting. The Reliance Group, founded by Shri Dhirubhai H. Ambani (1932-2002), is India's largest business house with total revenues of over Rs 99,000 crore (US$ 22.6 billion), cash profit of Rs 12,500 crore (US$ 2.8 billion), net profit of Rs 6,200 crore (US$ 1.4 billion) and exports of Rs 15,900 crore (US$ 3.6 billion).

Reliance Infocomm Ltd., an Anil Dhirubhai Ambani Enterprises group company, is India's largest private information and communications services provider, with a subscriber base of over 11 million. Reliance Infocomm has established a pan-India, high-capacity, integrated (wireless and wireline), convergent (voice, data and video) digital network, to offer services spanning the entire Infocomm value chain.

The Anil Dhirubhai Ambani Enterprises group, is a member of the Reliance Group, founded by Shri Dhirubhai H. Ambani (1932-2002).

[deepu 0]

Meet Anil Ambani, the HR manager

When Anil Ambani entered the Reliance Infocomm headquarters at the sprawling Dhirubhai Ambani Knowledge City in Navi Mumbai for the first time in two years, he made his intention clear: he wants to be perceived as a people's manager.

His six-hour-long visit on Sunday along with mother Kokilaben, wife Tina, sons Anmol and Anshul and sisters Dipti Kothari and Nina Salgaonkar, was thus solely reserved for what he called Reliance Infocommers. And he did it in great style in full media glare.

Shankar, a housekeeper, for example, could not believe his luck when Ambani sat next to him when he was having lunch. The junior Ambani asked for a glass of water and enquired whether he was having any problems at Infocomm.

Shankar forgot his lunch and said, "Pet bhar gaya sahab (I am feeling full)."

Thousands of Infocommers were there to welcome Anil much before the S Class Mercedes Benz arrived. After a quick visit to the nearby temple, Ambani preferred to walk to I-Block, which houses the chairman's office, about 7 km away.

Sporting an off-blue striped shirt and a brown tie, he shook hands with several hundreds of people.

"I am going to break my previous record of handshakes today -- the first was made on my wedding day. Please help me in achieving the record though I will need a massage this evening," Anil said, profusely sweating in the humid weather. The loud cheer from Infocommers proved he has managed to touch their hearts.

Just short of I-Block, Anil noticed a group of young women in a corner and did not waste the opportunity to offer some sound bytes: "I see a lot of young faces in the company but very few women. We will increase the number of women employees in the organisation, and will be an equal-opportunity-employer," he said.

Mahesh Prasad, president (applications), was there to welcome him to the I Block. Anil shook his hands warmly, saying loudly, "Prasad is the Priyanka Chopra of Infocomm." Why Priyanka Chopra? "Well, she is one of my favourite actors," the CMD said, looking fondly at a visibly embarrassed Prasad.

While getting introduced with the employees of I-Block, he played to perfection the role of a compassionate HR manager: "I apologise for calling you all on a Sunday. I look forward to working with you personally to make it one of the most valuable companies in the world," he said, adding "If any of you are interested in sports, come and join me for a walk next Monday."

Later, addressing the Infocommers in a nation-wide webcast, Anil "saluted" them for their passion to work hard and complimented his elder brother and former chairman of the company, Mukesh Ambani, for his "outstanding contribution" to create the company. " I am truly grateful to him, " he added.

Stressing on accountability as the core principle, he said: "In building and sustaining a great organisation, for me, accountability is the flip side of authority. The two are married to each other. Just as you are all accountable, I am accountable too".

"We must be a company that is build around the wants and needs of customers. You cannot argue with customers... Customer Care is not just the responsibility of those who face the customers, but each and every one of us."

Apart from growth and customer care, he also stressed on net addition of subscribers. "Gross adds per month are important, we must focus on net adds per month". He said the employees would be rewarded with performance-linked incentives, adding that "future is only limited by your imagination".

Courtesy - rediff.com

[Basant 0]

Anil also needs to take care of customer part too. He needs to win the hearts of Reliance users.

How about inviting him to this Forum? I do not know if there exists any similar Forum for other telecom users in India. He can learn many things over here which his company people won't tell him.

Can any one write an invitation to Mr. Anil Ambani?

[Arun 795]

What woes await Anil at Infocomm

Rediff.com

Anil Ambani grabbed the headlines in the family split for a variety of reasons. He was the original whistleblower showing just how wrong things were in the Reliance empire (that this was just opportunism, of course, was not evident then) and, from a situation in which his brother virtually cut him off from the empire, he's now walked away with a valuable chunk of it, including the only company brother Mukesh really created from scratch, Reliance Infocomm.

Yet, for all his bravado and the one-liners such as the one about how his new company has no back gear, Anil Ambani has his work more than cut out for him. For while Mukesh has the proven cash cows, Anil has the cash guzzlers with an uncertain future --sure, the upside is phenomenal, but so is the risk.

While Reliance Energy's future can look bright only after the state governments genuinely open up the power sector through open access and the state electricity boards become viable entities (both will take years), it is Infocomm that is the more serious problem.

For one, the ADC-avoidance cases (where Infocomm pocketed the access deficit charge payable to BSNL by disguising international calls as local ones) are still going on and BSNL has slapped new demands on Infocomm last week.

This, of course, may not be a worry for Anil Ambani as he's probably used the existing cases, and the possibility of future criminal liability (changing the caller IDs is illegal as it prevents tracing of calls), to lower the value of Infocomm in the settlement he's made.

More worrying, from his point of view, is that so far, the company's been more than a bit of a dud. It has roughly the same number of subscribers as Sunil Mittal's Bharti, but earns only around 60 per cent of the revenue.

Indeed, according to a recent study by the telecom regulator, Trai, while Infocomm and Tata Teleservices (both use CDMA technology) have an average revenue per user of $5.74 (about Rs 258) per month, that for GSM players (like Bharti, Hutch, Idea, and BPL, among others) is $8.89 (about Rs 400), or around 55 per cent higher -- for companies like Hutch, which have more post-paid subscribers (where the ARPU is $20.34), the blended ARPU is around Rs 750 per month.

Even more horrifying is that Infocomm got into such a low-paying-customer rut at a time when it had no shortage of funds (when Mukesh owned it, Reliance Industries poured money into it on demand, apart from Rs 8,100 crore (Rs 81 billion) of preferential capital; it even paid over Rs 3,500 crore (Rs 35 billion) for subsidised handsets during the Monsoon Hangama days) and when the best minds in Reliance worked overtime to ensure the venture was a success.

How badly the company has been run is best seen from the serious billing problems it continues to have, when billing is one of the basic things any service company gets right from day one.

Not surprisingly, Infocomm's blitzkrieg petered out even while Mukesh was in charge -- the company managed to get 6.2 million subscribers within six months of its operations as its phones/tariffs were virtually free since it did not even pay licence fees as it offered full-blown mobile services without having a licence for that. Once it began paying licence fees and could no longer afford the same level of freebies, it took the company over 18 months to get another 5 million customers.

Another factor that helped Infocomm get the additional subscribers, clearly, was the low tariffs and these, to a large extent, were funded by the money the company made in the ADC-avoidance business. None of this is available to Ambani Jr, the Reliance tap has been shut off, and presumably the ADC-avoidance game is over.

While the funds problem could be solved through an Infocomm IPO (the pricing will be an issue), the problem of getting higher-value customers is partly constrained by the choice of technology since CDMA phones cannot be used for international roaming as yet (in any case, most countries do not have CDMA networks) -- so, for all practical purposes, people with passports are unlikely to use Reliance phones.

Till date, changing handsets (and migrating from one phone company to another, like from Reliance to the Tatas or vice versa) is not possible on CDMA networks, either, and that also keeps away high-paying customers. In which case, what is Anil Ambani to do?

Apart from moving quickly to fix billing issues, moving to phones with removable chips, and developing a genuine service organisation (something the Ambanis have never done before), Anil needs to work on fixing the company's image -- given that the company has been found contravening the law twice in two years and has had to shell out around Rs 1,200 crore (Rs 12 billion) in fines alone, this is not going to be easy (clearly having 20-25 senior people dealing with government relations in Delhi, as against 5-6 in other companies, has only harmed Infocomm's operations).

Having 2.2 million square feet of office space over 14 buildings in a 140-acre space with lakes is great, but more successful companies like Bharti operate in a fraction of this. The choice of the earthy Sehwag as brand ambassador as opposed to the classier Sachin (Airtel) or Dravid (Hutch) has also ensured the brand's appeal has been to the low-paying customers.

While there is talk of Infocomm wanting to get into the GSM business as this is the fastest-growing in the world, this appears unlikely, given the huge costs involved and the fact that there is already a 1-crore- strong user-base on the CDMA platform (it is possible Ambani may toy with having both technologies, though there is no global example of a single user successfully offering both technologies). The choices are tough. As Anil said during the days he was battling brother Mukesh, "the nights are long, and the days will be even longer".

[chandramauli 0]

good luck anil ....

[anujit 0]

Fundamental problems with Infocom - cheating - Rs 12,000 crore - totally unnecessary. Would have been much better off spending it on customer care and billing!

And they have such a poor brand image (as a poor man's mobile!) - no wonder it has such low ARPUs!

There has to be major changes in RIM for this to change.

Of course dishonesty has been a trademark of RIL for quite a while now.

[solanky 0]

Wait, there's more coming

THE seven-month-long spell of uncertainty that had engulfed the Reliance empire over ownership issues between the two brothers Mukesh and Anil Ambani has finally been amicably resolved. Though the finer details will be worked out over the next few weeks, Reliance Infocomm, representing the telecom business built painstakingly by Mukesh over the past three years, has been formally handed over to Anil as a part of the settlement process.

As Anil takes over the mantle of Reliance Infocomm, it will be interesting to watch how skilfully the company negotiates the challenges that are likely to dominate the domestic telecom arena over the next year. The three likely trends are:

Mobile tariff wars

Competitors, both in the CDMA and GSM mobile space, are likely to track the changes in the top management structure at Reliance Infocomm quite closely.

Though there are indications that there will be no changes in the professional team managing the company, it will be scouting for a new Chief Operating Officer and a few new members on the Board.

It may appear logical to expect Tata Teleservices, the closest rival of Reliance Infocomm in the CDMA space, to launch a tariff war to exploit the opportunity opened by the transition structure in the latter or at least test the speed of decision-making within the new management.

Since the entry of Tata Teleservices in the prepaid segment in November 2004, it has managed to notch up fairly impressive customer addition numbers, averaging over 1 lakh subscribers every month since then (except the month of March), with month-on-month percentage growth being comfortably over 10 per cent.

In absolute terms, however, its customer additions have been only half that of Reliance of over 1.2 million between December and May.

Considering that Tata Teleservices' marketing has been getting stronger over the past few months, it will be in a position to launch an aggressive tariff war aimed at bridging the customer addition gap with its key competitor.

And it has little choice, since its CDMA subscriber base at 1.3 million is sharply lower than Reliance Infocomm's 9.96 million subscribers as of May 2005. In turn, this can have a cascading impact as GSM operators will also have to match these tariffs to stay competitive.

For that matter, the first salvo of the mobile war using bundled offer packages (with cheaper handsets) and zero rental schemes has already been fired in an attempt to woo consumers.

Take, for instance, the recent bundled package by Tata Teleservices offering a CDMA handset by Huawei, a connection and free talk time of Rs 1,500, all for a one-time payment of Rs 1,999.

This effectively means that it is offering a subsidised mobile handset for Rs 499. This package was in response to similar packages offered by Reliance Infocomm and Bharti's Airtel some time ago at slightly higher rates.

Similarly, select mobile operators, including Reliance Infocomm, have also started testing the marketing opportunity with zero rental schemes.

Considering that these competitive trends have worked well in the developed countries such as the US and Europe, in India too, this innovation is bound to find favour among mobile subscribers.

If this mobile tariff war escalates, there will be greater stress on Reliance Infocomm's operating margins, which were at 17 per cent for the year ended March 31, 2005 compared to Bharti Tele-Ventures healthy margins of 37 per cent.

Unless the data and other value-added services pick up sharply or a new line of business opportunity such as broadband opens up in a big way, the pressure on margins for Reliance Infocomm may continue. The strategic response from the new management will be watched closely.

The IPO rush/Consolidation

Since the ownership structure is now clear within the Reliance fold, plans for an initial public offering are already in the works for the end of this year. This is bound to put pressure on other mobile players such as Hutch to reconsider its plans for an IPO, that it had recently deferred for the second half of this year.

The lack of clarity over changes in the foreign shareholding rules, even as the FDI limits were raised from 49 per cent to 74 per cent, had pushed the IPO deadline.

In addition, the delay was also on account of breakdown in the deal with Aircel, the mobile operator in Chennai and Tamil Nadu, a few months ago, on account of regulatory issues.

Since the Communications Minister has indicated recently that the guidelines on the hike in FDI investment cap on telecom services to 74 per cent are expected to come out soon, Hutch may push through its IPO faster than expected.

Similarly, consolidation in the GSM mobile space has once again picked up momentum. The GSM players, who have been on a sell-out mode over the past year, have gone through a rough ride. While Aircel stake sale fell through with Hutch, Cingular Wireless 33 per cent equity stake held in Idea Cellular that was to be bought by Singapore Technologies Telemedia and Telekom Malaysia combine was called off recently on regulatory glitches.

However, there is no dearth of bidders for these GSM operators. For instance, BPL Mobile has been receiving a spate of unsolicited offers in the past few months and sooner or later, consolidation activity is slated to pick up again.

Every single deal by domestic players such as Bharti or Hutch can change the mobile subscriber sweepstakes in a big way and put greater competitive pressure on Reliance Infocomm.

Regulatory battles

The mettle of the new management will be tested in the battle over allocation of additional spectrum to both GSM and CDMA camps. As the GSM camp has mounted pressure on the government questioning the spectral efficiency of CDMA and allocation based on subscriber numbers, the outcome of this battle will be quite significant for Reliance.

If the additional spectrum is allotted as recommended by the telecom regulator, Reliance will be in a position to launch 3G services and gain a head start over its peers in the 3G arena.

At the same time, the controversy over alleged illegal call routing done by Reliance Infocomm refuses to die down completely. In the months ahead, there will be greater pressure on the new management to settle this controversy with the Department and Telecommunications and the state-owned Bharat Sanchar Nigam.

Source : Hindu Business Line

[sudhir_garg 0]

Anil also needs to take care of customer part too. He needs to win the hearts of Reliance users.

How about inviting him to this Forum? I do not know if there exists any similar Forum for other telecom users in India. He can learn many things over here which his company people won't tell him.

Can any one write an invitation to Mr. Anil Ambani?

34756[/snapback]

I Believe you must invite Mr Anil Ambani on this forum. Believe me I am shocked by his enthu for his employees. On his webcast to employees he talked about customer care and services. Believe me you need to see BSES. Now you get bills in time and is customer centric.

[Saurav 22]

In my view the main effect of the change in the management (Anil) will be maximum on the upcoming projects like wireline phone, Broadband, Netway.

It will be positive or negative that time will confirm.

[anujit 0]

Whats important to note all speculation aside is that Anil hasn't announced any policy for Infocomm as yet. Once that starts happening we'll know if we can buy EVDO handsets this year!

[Arun 795]

TIMES NEWS NETWORK - WEDNESDAY, JUNE 29, 2005 02:09:49 AM

MUMBAI: Soon after taking over the reins of Reliance Infocomm, Anil Ambani, has begun poaching senior executives from his competitors.

The first to join the Anil Dhirubhai Ambani Enterprise Ltd (ADAE) — is Jai Menon, the president of Bharti group’s IT and Technology Applications. Menon will join ADAE as group president, Information Technology (IT) with a groupwide responsibility for IT, across its various businesses including Reliance Infocomm, Reliance Energy and Reliance Capital, a senior official from a placement firm said on condition of anonymity.

Industry sources say that Anil’s immediate priority is to bring in experienced professionals into Reliance Infocomm, where top positions such as chief operating officer, chief information technology officer and chief marketing officer are waiting to be filled. Once the core team is in place,he is expected to go for a big haul.

Before Bharti, Menon had 16 years of experience in US with assignments with IBM and BellSouth.

[Chirag 5]

Anil appoints Gautam Doshi as group president

Rediff.com

July 01, 2005 17:28 IST

Last Updated: July 01, 2005 17:37 IST

The Anil Ambani controlled-ADA Enterprises on Friday announced the appointment of Gautam Doshi, a leading chartered accountant, as group president and key member of the leadership team.

Doshi will be primarily responsible for mergers and acquisitions in addition to supervising tax, regulatory and accounting functions, a Reliance release said in Mumbai.

Doshi, who qualified as a chartered accountant in 1975, was formally a senior partner at RSM & Co and a director of Ambit Corporate Finance and is widely recognised for his expertise in matters relating to accounting, taxation and regulatory laws, the release said.

ADA Enterprises chairman Anil Ambani welcomed his appointment in the leadership team and said "Doshi is a great asset for any organisation and will add greatly to the efforts in creating value for the stakeholders".

[anujit 0]

Does Anil get to retaint the Reliance brand name for all his cos? What about new cos like Adlabs and the like?

And if he does - for how long?

[Arun 795]

What next: That's the buzzword at Infocomm

[JUNE 20, 2005 02:19 AM]

- Economic Times

MUMBAI: Reliance Infocomm’s a centipede. What difference should it make if a few people are moved?’’ Kamal Nanavaty, the COO of Infocomm’s wireless business countered recently when questioned about the possibility of Anil Ambani making changes in the Infocomm team. On Saturday, Anil Ambani assumed charge of Infocomm after the announcement of the family settlement.

Ask any other top manager or employee and you get to hear the same (seemingly rehearsed) answers, “This is a professionally run company. Why should it be affected?” or “This is how the Ambanis work. They set up the project and then they leave it to professionals to run.”

But scratch the surface and the tension is palpable. “What next?” is the question uppermost in the minds of the employees.

According to industry observers, Infocomm could see at least 30-40 departures, if Ambani junior decides to replace all the key positions with his own men. “Apart from persons close to Mukesh Ambani, departments like advertising and marketing in which Nita Ambani took an interest could see a total revamp,” pointed sources.

For employees, the suspense is killing. “Morale has been maintained until now. But if there is no clarity, there could be problems,” admit those involved closely with the company.“Some of these people (Infocomm executives) have left lucrative jobs and positions to join Infocomm and may not be able to go back to where they came from,” said industry sources.

Infocomm officials hope that the new boss would note their performance. Although competitors still scoff at some of Infocomm’s numbers, the final report card does show more than passing grades on completion of two years of commercial operations, which happened in early May ‘05. After all, the company has a net profit to show, albeit one propped up by other income.

Infocomm’s revenues during its second year, ‘04-05, stood at Rs 5,387 crore with a net profit of Rs 51 crore. Bharti’s revenues during ‘04-05 were about Rs 8,066.67 crore.

Unlike other Reliance group companies where life is likely to continue much the same as always, for Infocomm, the resolution of the “ownership issues” threaten to bring about major changes. For one, it would bring in a new boss, a new management structure and possibly a change in overall direction and focus too. While Mukesh is seen as boss with a technical bent of mind, Anil is seen to be more savvy when it comes to finance and marketing.

With Anil at the helm, industry observers expect Infocomm’s IPO plans to be fast forwarded. The earlier management team had planned to tap the markets after completion of all the projects such as wireless, and enterprise broadband so as to reap the benefits of full valuation.

The future of ambitious initiatives like the Netway project is in the dark. Industry observers believe that Mukesh’s pet project, Netway, that was expected to revolutionise the way India watches television, movies and accesses the internet, is likely to be most affected by the absence of the senior Ambani. The Netway project involves selling hundreds and thousands of set-top boxes which would enable TV sets to access the internet.

While most of Infocomm’s projects seem to be on schedule, the Netway project has been delayed and is likely to be further delayed by 6 months or more. Prakash Bajpai, who heads Infocomm’s Enterprise businesses, however denies that the project will in any way be affected by the presence or absence of Mukesh Ambani. “He has told us what he wants. Now its a matter of putting the technology in place. Remember, such a project does not exist anywhere in the world,” says Mr Bajpai.

It is not the technology, rather whether Anil chooses to continue with Mukesh’s pet project or suggests major or minor changes is cause for speculation. “The issue is how different is Anil’s vision from that of Mukesh’s,” pointed out industry sources.

Despite having cleaned up its subscriber base and attracting subscribers who have a minimum Average Revenues Per User (ARPU) of about Rs 400 or more, Infocomm is stuck with the ‘501’ image. It has still to shed the image of a telco with a large proportion of defaulters and subscribers comprising taxi drivers, vegetable vendors and other low ARPU yielding subs.

SP Shukla, president, Wireless Products and Services, Reliance Infocomm, disagrees. “At Rs 400 or Rs 700 we are not cheap, but we believe in giving value to our subscribers,” says Mr Shukla while referring to the several products launched last year that allow unlimited talk time for a monthly package of Rs 400 or Rs 700.

The image is a legacy of the past two years that have been tumultuous for Infocomm. From being one of the last entrants in mobile telephony, it has edged past other mobile companies to become the country’s largest mobile operator with a subscriber base of about 10m. But each of Infocomm’s successes were won the hard way, despite the money and the muscle power of the Reliance group. Nanavaty, however, believes that all of Infocomm’s troubles are behind it. “That is all behind us. We are now onto a fresh start,” he says. He believes ’05-06 will be the period when Infocomm will get its place under the sun.

Most of the “plumbing”, as Bajpai calls it, “is in place.” In the new fiscal, Bajpai is hoping to reap the benefits by launching programmes like “Ashwamegh”. “Acquiring 100% customers in any building that we have wired up - that’s our plan,” Mr Bajpai says.

The first phase of the enterprise broadband business was commercially launched in last quarter of ’05. “We have acquired over 60,000 customers including over 400 of 1,200 top corporates of India,” he adds. The broadband last mile network is under expansion from 30 cities to 192 cities. The plan is to reach 1.7m buildings over the next 2-3 years, and of this, 3,00,000 buildings will be wired up this year.

Swarup Chowdhary, CEO, Reliance WebWorld says, “This will be the first full year of operations for the web worlds.” Of the last two years, the first was spent in being a sales and service front for the mobile services and the second year in transitioning to the broadband mode.

Apart from being a revenue enabler for the Reliance India Mobile (RIM) phones and showcasing the power and speed of broadband, the Web Worlds also end up earning revenues out of various services provided on the strength of their broad band network. Video conferencing for corporates with their sales personnel, dealers and distributors, e-learning, gaming, internet usage, are some of the services provided by the Reliance Web Worlds.

After two years of offering free access to the R World content, the company has started charging its subscribers for some of the services from April 1, ’05. Unlike other mobile operators, Infocomm’s plans for revenues from data services are ambitious. “The Japanese and Korean telcos earn about 15-28% per subscriber from data services alone. Why make any different from them?” asks Mahesh Prasad, president Applications & Solutions Group, Reliance Infocomm.

Infocomm is also gearing itself for the launch of 3G services before the end of this fiscal and is waiting for clarity on government policies. The trials of the EVDO (movie quality video) on handsets are on across the entire campus of the Dhirubhai Ambani Knowledge City (DAKC) which is 3G ready.

’05-06 could have been a year without legal spats for Infocomm, but for the fight over spectrum that is likely to be the mother of all battles for telcos and will be even more fiercely fought than the limited mobility versus GSM fight.

In its short history of two years, Infocomm has possibly had to fight more fires than any other company. The uncertainty arising out of “ownership issues” has come at a time when the operational issues are more or less streamlined.

For Infocomm, the big question today is how the young company survives the long drawn out spat between the brothers, which has just ended, and the changes that are likely to be effected over the next six months or so.

[Arun 795]

Reliance Infocomm ready to ring in changes, post-deal

TIMES NEWS NETWORK [JUNE 23, 2005 03:05 AM]

- Economic Times

MUMBAI: The entry of Anil Dhirubhai Ambani as the new chieftain of Reliance Infocomm has given rise to nervous excitement in the industry and the company as employees expect several changes in the days to come.

The biggest speculation is regarding the next head of Infocomm with several names cropping up at some time or the other.

These included Hutchison’s managing director, Asim Ghosh, deputy managing director, Sandip Das, Bharti Enterprises’s joint managing director, Akhil Gupta and ex-Hutchison Max Telecom and Reliance Telecom CEO, Ashwini Windlass.

Anil Ambani is seen as entering Infocomm when most of the glitches have been ironed out such as the billing problems, the issue of limited mobility, creating a brand identity and grabbing market share from other entrenched operators.

The younger Ambani is expected to bring about several radical changes in Infocomm. Industry sources expect Anil Ambani to target an initial public offer (IPO) within the next six to eight months, especially since it can no longer count on financial support from Reliance Industries (RIL).

However, at the ground level, save for the continuity of their jobs, employees are not directly concerned with the change in the top management. “As long as we are assured of our jobs and salaries, how does it matter who is at the top,” they feel.

But bankers are concerned. Even as bankers queue up to meet Anil for the Dadri project, they are seeking clarifications regarding the bad debts of Reliance Infocomm and Flag Telecom. Sources close to the company said that the old bad debt had been accounted for earlier. “The company’s bad debts are now in line with the industry standards,” they said.

They also said that Flag was now part of Anil Ambani’s empire as it was part of Infocomm. Earlier, there were reports that Mukesh Ambani was reluctant to part with the overseas submarine cable company. The different management styles of Mukesh and Anil Ambani are also likely to result in changes at Infocomm.

“While Mukesh is seen as slow and steady, Anil is expected to move very fast and in a more impulsive manner,” said sources. For instance, ever since Anil Ambani started looking closely at Infocomm, about several weeks ago, the company is said to have decided to put a freeze on recruitment.

However, sources close to the company denied that there was any decision to reduce the staff strength. The freeze in recruitment, they said, was a routine matter since companies time and again freeze recruitment to re-assess their employee numbers.

There is no reduction in the number of direct employees, those who were hired by Infocomm and these employees are likely to be retained by the company. Currently, Infocomm’s total staff strength is about 40,000, including the direct and indirect employees.

But industry sources said that “indirect employees” could be affected. These employees work for Infocomm but are not on its payrolls. They are hired by agencies that are retained by Infocomm. “Those who were working with Infocomm as part of hired staff through agencies have been told that their contracts will not be renewed,” said sources.

[Arun 795]

Anil to pump Rs 2k cr into entertainment business

TIMES NEWS NETWORK [JULY 07, 2005 01:27 AM]

MUMBAI: The Anil Ambani group has decided to pump in at least Rs 2,000 crore, or “whatever it takes” over the next 12 months to emerge as one of the largest players in the media and entertainment space. This does not include the recent Rs 350-crore acquisition of Adlabs.

The investments are mainly going to be funnelled into setting up a direct-to-home (DTH) broadcasting network, a planned foray into FM radio broadcasting as well as the entire value chain of the film industry that covers production, distribution and exhibition.

“We intend changing the entertainment and media landscape with the largest investment in this space by any single player,” a spokesperson of the group told ET. The focus will be on controlling distribution networks and infrastructure rather than production of content. “We intend reaching the consumer through every carriageway,” the spokesperson said.

The group intends to be a DTH broadcaster through its subsidiary ‘Reliance Skymagic’, a subsidiary of Reliance Energy. This involves an investment of over Rs 400 crore to kick off operations. The company’s application for a DTH license is currently pending before the Union information & broadcasting ministry.

When it was pointed out that there were already four private players in the DTH space when the world over there are just one or two that survive in each market, the spokesperson said in India the market could accommodate 4-5 players considering that the telecom industry has flourished with as many.

In the film business, the Anil Ambani Group has already booked a slot with the acquisition of the Adlabs film-processing business, film exhibition and distribution.

In the exhibition business, Adlabs will be the key to ramping up operations (though other companies would also be in the picture) through setting up 1,000 digital screens. This would be in addition to the 30 new multiplex screens Adlabs would be commissioning before the end of this year.

Dismissing the thought that this amounted to a tall order in one year, the spokesperson said: “Existing single-screen theatres or multiplexes would be acquired or franchised and retro-fitted to be served through an optic fibre network from Reliance’s data centre.”

The Anil Ambani group, on the film distribution and production front, would enlarge its business by entering into co-production deals, acquisitions of existing film projects and forging long-term alliances with distribution groups.

“We will only enter an alliance if we are guaranteed complete management control. These alliances will be with producers and distributors and not with intermediaries,” the spokesperson clarified.

The Reliance spokesperson dismissed speculation that the Anil Ambani group might ally with the Sahara group, but acknowledged that in the film space the latter was a big player and would therefore have to be seen as competition. The group through Reliance Capital (part of the Anil Dhirubhai Ambani Enterprises Group) has recently picked up a minority stake in Prime Focus, a post-production company.

The spokesperson however clarified that Reliance Capital would continue to hold financial investments in some film production companies like K Sera Sera, and these would not necessarily be part of its media expansion drive.

The optimism in the group stems from the belief that the newly formed Anil Ambani Group is an integrated company with a subscriber base of 17m for both Reliance Energy and Reliance Infocom. This, it is argued, would give the media and entertainment business a large captive market and serve as a springboard.

The spokesperson also disclosed that Reliance would be pitching for the FM Radio licenses when they come up for the next round of bidding shortly, and the target could be as many as 90 radio stations through the country. A satellite radio service was also on the cards with international content being sourced through its FLAG network.

On other fronts, Reliance is at an R&D stage for its IPTV service and would be offering entertainment through mobile telephony too. “We will supply all content to everyone, at all times or at anytime, everywhere,” echoed the Reliance spokesperson.

[trial 0]

Will Anil connect?

Prerna Raturi & Amit Ranjan Rai / New Delhi July 12, 2005

A look at some issues the new head of Reliance Infocomm is likely to confront

A prominently displayed plaque at the entrance of Reliance Industries’ office in New Delhi spells out Mukesh Ambani’s vision for Reliance Infocomm. But the telecom company that has always been identified as Mukesh’s baby was made over to younger brother Anil in the settlement worked out last month.

Except that Anil Ambani hasn’t been involved with the running of Infocomm; it’s a company that’s been in trouble with the law; and its biggest, so far unquestioning source of funds — RIL — is now no longer available. Add to this an inheritance that includes customer dissatisfaction, a downmarket image and a technology that’s not being accepted as well it could be, and Ambani’s clearly got his work cut out for him.

The Strategist discussed the issues on hand with Infocomm executives, competitors and telecom industry experts. Here’s their analysis of trouble areas and possible ways out.

Tech trouble

First, the good news. Infocomm is the second largest player in the mobile telephony arena: its 20 per cent share of the 52-million subscriber market is just one percentage point behind Bharti. It has a nation-wide presence, a robust infrastructure — an 80,000-km optical fibre cable network that supports voice, data and video — and a pan-India wireless network based on the latest CDMA technology.

“We aim to be the leaders in the digital value chain. This means we will be in the mobile telephony, long-distance, broadband, home, media and entertainment space,” says the spokesman for Reliance Infocomm.

But, at Rs 5,387 crore, its revenue is 33 per cent lower than that of Bharti, which also has a pan-Indian presence, operates on the GSM platform and has just 0.5 million more subscribers than Infocomm (11 million).

What explains this gap in revenues? One reason is that Infocomm hasn’t got enough high-end subscribers. According to a recent study by the Telecom Regulatory Authority of India (Trai), Infocomm’s average revenue per user (ARPU) is Rs 258 a month, compared to GSM players like Bharti, Hutch, and Idea, whose average monthly ARPU is Rs 400 (for some service providers such as Hutch, the blended ARPU can be as high as Rs 750 a month). Infocomm can blame its late entry into mobile services for that.

Arpita Pal Agrawal, a telecom industry consultant with PricewaterhouseCoopers, explains a little more. “With any technology, first the most paying get on to the networks. That gave Bharti an early-mover advantage.”

Gradually, as tariffs came down and handset prices dropped, Bharti tapped the mass market too, with its strong brand positioning and network strength. Which means that by the time Reliance announced its CDMA services in December 2002, most high-end customers had already signed on with other service providers. Meanwhile, points out telecom industry expert Mahesh Uppal, “Reliance was left with the dregs.”

And it’s not going to be easy to get the big spenders to switch to Infocomm (remember, price is no longer an issue: mobile telephone rates are now more or less the same across service providers).

The issue here is technical: the CDMA technology adopted by Infocomm does not support international roaming services on different networks. It didn’t help that, until some time ago, Infocomm subscribers could not change their handsets at will — that was also a deterrent to several potential customers.

Perhaps the way out lies in concentrating on data service-based revenue, given that voice is becoming increasingly commoditised. One option is the data services plan that Mukesh Ambani chalked out in 2002, when he had indicated that voice telephony would account for not more than 25 to 30 per cent of Infocomm’s total revenue. The numbers point to the sense in that plan.

Trai has forecast that by 2010, the number of Internet subscriptions in India will increase to 40 million, from 6 million currently. Of this, broadband will account for 9 million subscriptions in 2007 and 20 million by 2010.

Infocomm has an edge here: when it comes to data, CDMA technology has proven superior to GSM — its spectrum is more reliable, making functions like broadband, video conferencing, gaming, DTH, V-Sat and so on, more efficient.

Value-added services (VAS) could be another money spinner. Over 10 per cent of the mobile service revenue of GSM service providers comes from add-ons such as missed call status, caller ring-back tones (CRBTs), ringtones, wallpapers, text and multimedia messages, and so on.

Recent research by brokerage and research firm SSKI places the VAS market at nearly Rs 350 crore — expected to grow to Rs 3,800 crore by 2010 — of which more than a quarter is accounted for by CRBTs. Airtel’s “Hello Tunes” illustrates that perfectly. The CRBT service was introduced a year ago — it now offers 10,000 songs in 18 languages and gets 2 million downloads every month.

Uppal, too, advocates VAS as a viable option for Infocomm, but adds a rider: “These features are fast picked up by competitors.” The key is constant innovation — after Hello Tunes, Airtel moved on quickly to launch a stock ticker, sudoku puzzles and games based on the latest movies. But innovation may be a test for Ambani. “ Reliance has been a hard-core product company with limited experience of running services,” agrees Uppal.

Billing bungles

I am a Reliance customer in Delhi and the NCR. I have not received any bills since October 7. Is this a problem only with me or with other Reliance subscribers, too? (January 16, 2004).

My unbilled usage starts from Rs 1,600.60 every month. My monthly average bill is around Rs 900. Right after my bill is generated, I get a call that my usage is high (my credit limit is Rs 1,500). The executives just don’t accept my problem since they say they use an “error-free world-class billing system” (March 18, 2005).

— Complaints posted on RIMweb.com

Building up its strengths region by region may also help Infocomm overcome its troubles with faulty billing and customer complaints. A company insider attributes billing glitches — a perennial grouse against Infocomm — to faulty software and weak processes for database management. Anil Nayar, director, Bharti Tele-Ventures Ltd, points to the possibility of human error, too. “There can be lapses while processing the bill.”

Could outsourcing the billing function be the solution? That would free up Infocomm resources that could be deployed on customer care, feedback and brand building. Bharti already outsources roughly 70 per cent of its call centre operations and, in March 2004, it contracted out its entire IT functions (including billing) to IBM.

Nayar says that has worked well. “When you are growing very fast, there is a tendency to miss out on certain areas, which can pull you down,” he says.

Meanwhile, Infocomm has been busy reaching out to customers. Its retail and customer service outlets — the Reliance Webworld — has given way to a sleeker, smaller avatar, the Reliance Webworld Expressway.

Compared to the 240 Webworlds that were set up over two years, since April this year more than 1,000 WWEs have already come up. And according to Trai’s recent report on the telecom industry, for the first quarter of FY05, Infocomm has a 100 per cent response rate in areas such as fault incidence and repair; its average call rate success (within the licensee territory) is 99.05 per cent.

Brand Building

This is perhaps the biggest task ahead of Infocomm. For starters, Anil and Infocomm now no longer have the backing of RIL. Infocomm has also had a couple of brushes with the law, which haven’t helped its reputation any.

But perhaps the biggest hurdle for the company will be to change the image perception of its mobile service. Points out an industry observer, “Reliance decided to offer cellular phones services at the cost of a post card. Consequently, the poor man’s phone perception has stuck to CDMA.”

----------------------------------------------------------------------------

QUICKBITE

Market trends indicate that the next battleground for telecom companies will be the non-voice data services segment. According to research firm IDC India, the non-voice market (SMS and ringtones among others) was Rs 695 crore in 2004 — based on the current mobile turnover of around Rs 22,000 crore, that’s around 3.15 per cent of the total business.

By the end of the decade, estimates IDC, the value-added services market — ringtones, wallpapers, caller ring-back tones and multimedia messaging, among others (that is, the non-SMS part of the non-voice market) — will grow from a mere Rs 191 crore in 2004 to around Rs 2,300 crore. That’s a compound annual growth rate of over 65 per cent.

Consider Korea, one of the world’s fastest data services markets. IDC has forecast the mobile market there to soar by 30 per cent in 2005 to £1.34 billion. In contrast, the voice market is only expected to grow by 3.4 per cent.

The key drivers for the increase in mobile data revenues will be the growing number of video services and an increasing number of mobile banking users. In particular, video telephony calls are predicted to make a big impact on the Korean mobile data market as the new W-CDMA networks take off.

-------------------------------------------

Business Standard

Rediff

Makes a reference to our own rimweb.com as well :'(

[dhayfule 0]

Makes a reference to our own rimweb.com as well :'(

35606[/snapback]

Sounds good

[anujit 0]

Now only if we get the persons it was intended for to LISTEN!!!!

[Arun 795]

Nokia's Sanjay Behl joins Reliance Infocomm

July 11, 2005 16:51 IST

Sanjay Behl, head of marketing operations, Nokia, has joined Anil Ambani-controlled Reliance Infocomm as head of branding.

Behl will be a key marketing resource for the group, Reliance Infocomm said in a statement in New Delhi.

In Nokia, Behl was head of marketing for its India operations. Reporting to the managing director, his responsibilities included managing the brand, products, technology, retail and media.

Anil Ambani appoints Ramesh Venkat

July 12, 2005 19:38 IST

In yet another top-level appointment, Anil Ambani has inducted Ramesh Venkat, chief financial officer with Vedanta of Sterlite Group into ADA Enterprises.

Venkat has an experience of 20 years as a Charted Accountant.

He joins the bandwagon of Gautam Doshi, Sanjay Behl, K K Sinha and Jai Menon, as part of top management team of Anil Ambani.

Let's meet the A-team of Anil Ambani

TIMES NEWS NETWORK [TUESDAY, JULY 12, 2005 01:13:09 AM]

Anil Ambani is out shopping for talent. He is, in fact, handpicking some of the top corporate brains in their respective functions to form a part of his A team.

So, while Gautam Doshi, an ex-Ambit director is joining as the head of mergers and acquisition, Sanjay Behl has been roped in from Nokia to head the corporate branding and marketing of Reliance Infocomm. Jay Menon, a former Bharti hand is joining Anil Dhirubhai Ambani Enterprises (ADAE) as the group information head.

Besides, the younger Ambani also picked up KK Sinha last week as part of a talent acquisition spree. Mr Sinha, an ex-NTPC hand, joins as the HR head for Reliance Energy and as a board member.

Mr Sinha, who was director (HR) at NTPC before joining REL, is widely regarded as one of the pioneers in the field of human resource development in the country and is credited with several groundbreaking HR initiatives and processes.

Moreover, Rajendra Chitale, a noted chartered accountant, has already been appointed as an independent director on the Reliance Capital board.

ADAE has picked up some 10 key executives so far, sources say. In fact, five of them have given their nods in the last week itself. Sources also say that many more positions will be filled in the weeks to come.

And all with fantastic salary packages. Sources say that Anil’s choice of people points to his ambition of creating a world-class organisation, a fact that he has reiterated time and again.

Mr Behl, who had a spectacular 18-month stint at Nokia, built the brand with FMCG passion amid tough competition.

Anil has a stated plan to make Reliance Capital a full spectrum financial services power house to be counted among the top three financial services firms in India. For Infocomm, he is advocating a new vision, sources say.

“Anil wants to give a broader definition to Infocomm biz and control the entire value chain in the industry,” said a source. Meanwhile, the industry is watching Anil’s moves very closely.

“Anil Ambani is aggressive, adventurous and maverick in his approach,” said a telecom CEO. “And that could stand him in good stead in the years to come as people would be more willing to buy into his growth story.”

Many also feel that his priority would clearly be to set Infocomm affairs in place.

[Arun 795]

Close to Nature: Reliance Infocomm promotes wildlife awareness:

Sunday, July 17, 2005 (Chennai):

Two remarkable wildlife films by Shekhar Dattatari marked the launching of the Wild Macaw Club, set up by Reliance Infocomm in Chennai.

And as the wonders of the forest unfurled before their eyes, the students of the Bharatiya Vidya Bhavan, which is partnering the initial project, sat spellbound.

Camping, trekking, nature trails and jungle trips are also on the cards for members.

"We have just seen many beautiful scenes like the tigers pouncing on each other. It's real fun. I would love to go to the forests, if I got the chance," said a student.

Wild Macaw Club is one with a new and delightful title of Wild Macaw Club, hoping that the venture will teach children about wildlife and forests, which badly need to be preserved.

Need for preservation:

There was time for a question and answer session with the award winning filmmaker - who has consistently used the medium of film to increase awareness about our precious wildlife and the way it is to be preserved.

"We are looking at this as a new initiative to understand the travel space itself, to see what travel is all about, and what the travellers are looking for," said Lakshmi Sharath, Netway Project, Reliance Infocomm.

"I'm far more concerned about what most of the corporates are doing to India. They are mining and raping this country with no thought of tomorrow," said said Dattatri, the filmmaker.

"This is something very very serious, which we need to be concerned about. Teaching people and so on are wonderful things, but on the other hand, stripping India's forests--- this is not on," he added.

Most of the new members, about 1500 in all, are customers of different Reliance WebWorlds and registration for the first month is free.

And it's hoped that, apart from making outdoor travel a habit, enjoying wildlife itself will become a popular past time.

[solanky 0]

Nalini Gupta joins Reliance Info

MUMBAI: Mr Anil Ambani controlled Reliance Infocomm has appointed Ms Nalini Gupta as Marketing Advisor - Chairman's office.

Prior to the new assignment, Ms Gupta was the chief products and marketing officer at Airtel Enterprise Services, where her responsibilities included product management of voice and data products along with new introductions, the company said in a releas e here.

Source: Hindu Businessline

[deepu 0]

Snatched one from rival company!!!

Wonder how much she was offered!!!