Indian police raid Bharti, Vodafone offices

(NEW DELHI) Police on Saturday raided offices of two of India’s biggest telecom firms, Bharti Airtel and Vodafone Essar, in a widening probe into alleged wrongdoing in the awarding of mobile spectrum.

India’s top federal police force, the Central Bureau of Investigation (CBI), searched offices of Bharti Airtel, and the Indian unit of Vodafone, part of Britain’s Vodafone Group, as well as senior former government telecom officials, a CBI spokeswoman said.

The searches involved alleged irregularities in the distribution of second-generation (2G) mobile spectrum between 2001 and 2003 when the previous Hindu-nationalist Bharatiya Janata Party (BJP) was in power, the spokeswoman said. ‘The searches were in connection with allegations that have been framed,’ she said.

The raids were part of an increasingly sprawling police investigation into awarding of spectrum that has engulfed the current Congress-led government and threatens to taint the previous BJP government which ruled until 2004.

The BJP accused the Congress government of seeking to blacken the opposition party’s name and nicknamed the CBI ‘the Congress Bureau of Investigation’. BJP spokesman Prakash Javadekar said: ‘What is happening is part of a political conspiracy to divert attention away from the government.’

The raids come as a former Congress telecoms minister is on trial with 13 other top government and other officials over an alleged multibillion-dollar corruption scandal involving the allocation of mobile spectrum in 2008.

A Raja, telecoms minister from 2007 to 2010, is the central figure in the case that has rocked Prime Minister Manmohan Singh’s administration and helped make corruption one of India’s hottest political issues.

Responding to the raids, a spokesman for Bharti Airtel, in which SingTel has a stake of about 32 per cent, said ‘all the spectrum allotted to us from time to time has been strictly as per the stated government policy’.

Vodafone said the company had acted in ‘complete compliance’ with rules. Britain’s Vodafone bought a 67 per cent stake in Hong Kong-based Hutchison Whampoa’s Indian mobile unit in 2007, renaming it Vodafone Essar.

The CBI alleged in its preliminary enquiry report that the telecoms department increased the spectrum base under late telecoms minister Pramod Mahajan beyond the prescribed limit for a token sum and favoured certain companies, causing a loss to the exchequer. No formal charges have been laid.

The sale of 2G spectrum by the Congress government in 2008 at far below market rates to selected companies could have cost the treasury up to US$40 billion in lost revenue, the public auditor has alleged.

Raja has insisted he was only following the previous BJP government’s policy in awarding mobile spectrum. — AFP

SingTel to launch e-assessment books

FOLLOWING the launch of its e-book service – skoob – on Tuesday, Singapore Telecommunications (SingTel) yesterday announced plans to launch an e-assessment materials service – Skoob Go-easel – in January next year.

In collaboration with Popular Holdings, the new service will offer assessment books and study guides for Singapore’s primary and secondary school students via the Apple and Android tablets.

‘We believe e-learning is the way of the future. Skoob Go-easel complements our traditional paper book business by providing a powerful digital platform to reach a wider audience,’ said Chou Cheng Ngok, Popular’s chairman.

Skoob Go-easel will provide students with an experience that is similar to using paper assessment materials. It will also be equipped with time-saving features such as auto-marking and score analysis, and can provide students with model answers.

In addition, teaching guides will also be made available to help parents actively support their children’s learning. ‘We believe Skoob Go-easel will change the way students prepare for exams and help them to save precious time. The service will also allow busy parents to keep track of their children’s progress and performance more effectively,’ said Goh Seow Eng, SingTel’s chief of digital home.

Skoob Go-easel can be purchased using Singapore-issued credit cards, and SingTel customers may choose to have their purchases charged to their monthly bills.

The two listed companies said that they will explore ways to work with schools and the Ministry of Education (MOE) to offer a range of assessment papers, study guides and supplementary materials through the e-assessment service.

At the launch of skoob earlier in the week, Mr Goh said: ‘We believe skoob’s range of local study guides and educational books will be well received by school students, and we are looking to include assessment papers soon.’

He added that the telco is transforming from a provider of traditional telecommunications services to a multimedia solutions provider.

SingTel to launch e-assessment books

FOLLOWING the launch of its e-book service – skoob – on Tuesday, Singapore Telecommunications (SingTel) yesterday announced plans to launch an e-assessment materials service – Skoob Go-easel – in January next year.

In collaboration with Popular Holdings, the new service will offer assessment books and study guides for Singapore’s primary and secondary school students via the Apple and Android tablets.

‘We believe e-learning is the way of the future. Skoob Go-easel complements our traditional paper book business by providing a powerful digital platform to reach a wider audience,’ said Chou Cheng Ngok, Popular’s chairman.

Skoob Go-easel will provide students with an experience that is similar to using paper assessment materials. It will also be equipped with time-saving features such as auto-marking and score analysis, and can provide students with model answers.

In addition, teaching guides will also be made available to help parents actively support their children’s learning. ‘We believe Skoob Go-easel will change the way students prepare for exams and help them to save precious time. The service will also allow busy parents to keep track of their children’s progress and performance more effectively,’ said Goh Seow Eng, SingTel’s chief of digital home.

Skoob Go-easel can be purchased using Singapore-issued credit cards, and SingTel customers may choose to have their purchases charged to their monthly bills.

The two listed companies said that they will explore ways to work with schools and the Ministry of Education (MOE) to offer a range of assessment papers, study guides and supplementary materials through the e-assessment service.

At the launch of skoob earlier in the week, Mr Goh said: ‘We believe skoob’s range of local study guides and educational books will be well received by school students, and we are looking to include assessment papers soon.’

He added that the telco is transforming from a provider of traditional telecommunications services to a multimedia solutions provider.

Four key issues

• National Broadband Network will not hurt SingTel contrary to popular perception. Any potential divestment of Telkomsel to be neutral or positive

• Bharti is set to grow again although street may be overly optimistic while Optus faces competition in the near term

• Trading at 1-year forward PE of 13.0x below 13.2x historical average. Upgrade to BUY with revised TP of S$3.43 for resilient earnings and over 5% yield

Core plus Telkomsel & Bharti make up over 90%of group earnings. Singapore contributed about 32%, Optus 26%, Telkomsel 17% and Bharti 16% of FY11 earnings.

Market is overly worried about threat from NBN. There are three key factors here: (i) Porting limit of only 2400 connections per week for NetCo implies that full migration will take at least 8 years; (ii) NBN is not reaching fully inside corporate buildings due to resistance from building owners; (iii) Most importantly, SingTel gets 75% of NetCo revenue for allowing NetCo access to its network.

Optus is facing intense competition. Both Telstra and VHA have launched aggressive iPhone 4S plans, forcing Optus to follow suit. All telcos are offering extra subsidy of A$100 on mid-tier plans. Also potential cut in mobile termination rate in 2012F may have minor adverse impact.

Issues with Telkomsel & Bharti. Possible scenario of an all-cash sale of Telkomsel could be positive while other scenarios could be neutral to slightly positive. Meanwhile, Bharti is set for growth with Africa as the key driver; however street may be overly optimistic on India.

Upgrade to BUY with SOP based TP of S$3.43. The key change is higher valuation for Telkomsel in the light of improved competitive environment in Indonesia. Weaker regional currencies versus SGD would be the key downside risk to our TP.

SingTel joins e-book market with skoob

SingTel has become the latest to attempt turning the publishing world on its head, or to at least spell ‘books’ backwards.

Skoob, its e-book service, was launched yesterday, with six big publishing houses – Random House, Penguin, HarperCollins, Hachette Book Group, Simon and Schuster and Macmillan – on board. It also carries books by local publishers such as Popular and Marshall Cavendish.

Offered through a free Apple or Android app, as well as through browsers, the service has more than 39,000 titles, the majority of which are international, according to a SingTel spokesman.

On its website, the selection runs the gamut from George Martin’s Game of Thrones series to Asiapac comics. Classics such as The Art of War and works by Shakespeare will be available for free.

In a nod to the peculiarities of the local market, skoob also offers local study guides and educational books. ‘We believe skoob’s range of local study guides and educational books will be well received by school students, and we are looking to include assessment papers soon,’ said Goh Seow Eng, SingTel’s chief of digital home.

SingTel will enter a market which has been thus far dominated by Amazon through the latter’s Kindle e-book reader. A Goldman Sachs report in February said that Amazon accounts for 58 per cent of e-book sales in the United States. This is followed by Barnes & Noble with 27 per cent and Apple with 9 per cent.

Currently, the Kindle device is not shipped directly to Singapore and users here have resorted to gift cards or US credit cards to make e-book purchases on the Amazon online store.

‘The Singapore market has long been overlooked by e-book services from abroad. With the launch of skoob, Singapore readers finally have a service that offers local books and caters specifically to their tastes and needs. It also provides local publishers and writers with a powerful digital platform that allows them to reach a wider audience,’ said Mr Goh.

Unlike Amazon and Barnes & Noble, skoob is not tied to a specific device or platform. Customers have the option of sharing books on up to five devices.

Payment can be made with local credit cards and SingTel customers can opt to have purchases charged to their monthly bills.

While Amazon and Barnes & Noble offer digital subscriptions to magazines and newspapers, skoob does not appear to be headed in that direction, and will be focusing on e-books, according to SingTel’s spokesman.

In some cases, the skoob store offers e-books at a cheaper price relative to its competitors.

Kathryn Stockett’s The Help, for example, is listed at S$6.22 but was priced at US$9.99 for both the Kindle version on Amazon and the Nook e-reader version on Barnes & Noble. Haruki Murakami’s Norwegian Wood, however, was priced at S$20.05 on skoob, but was cheaper on Amazon and Barnes & Noble, costing US$5.99.

While SingTel did not reveal the number of readers it expects to draw, its spokesman said: ‘We believe e-books will be widely adopted in Singapore as more people carry tablets and smartphones…We know the demand is there, so we expect good take-up of the service.’