BANGALORE: Russia-backed mobile operator Sistema
Shyam Teleservices on Friday said it has decided to cease all investments in
its voice business, which has about 15 million customers in India, till the time
spectrum auctions take place in India.
Speaking to ET, SSTL President and CEO Vsevolod Rozanov said the company is suffering a loss of $1.5 million a day, and that the patience of its investors was slowly running out, with respect to clarity about the firm's future in India. SSTL operates under the brand MTS in India and has invested about $3.2 billion in the business till date.
During the first quarter of FY12, SSTL suffered losses of Rs 528 crore. "We have put on hold all investments in our voice business and are concentrating on data services, which are the core to our business now," he said. MTS India has about 1.5 million customers for its data services that are available via USB dongles and internet plans.
Russia, which holds a 17% stake in SSTL, formed a special working group this week under the lower House of its Parliament to protect the interests of Russian companiesworking in India. Russian government invested $600 million in 2010 in SSTL.
Rozanov indicated that MTS voice customers will remain unaffected for the time being. A decision on voice services will be taken only after auctions are over. MTS India was one of the operators impacted by cancellation of 122 telecom licences by the Supreme Court in February.
Rozanov also raised the issue of high base price for bidding for spectrum proposed by Trai. "It will actually kill the full CDMA ecosystem. Most operators will not be able to bid," Rozanov said. Telecom regulator Trai has proposed a base rate of Rs 3,622 crore per MHz.
"It has become very difficult to do business for us. For CDMA operations significant Capex is required. And our partners are very concerned about the future of our voice business," he said. Rozanov says SSTL for the year 2012-13 has made many alternative business plans and would execute them with changes in the policy scenario in India.
With respect to its licence cancellation, SSTL has filed a curative petition with the Supreme Court asking for a review. "We have petitioned saying that our name was not even indicted in the CAG reported. We should not be clubbed with others," he said.
The issue with respect to SSTL's future in India was also raised with India by the Russian President Vladimir Putin during his visit to New Delhi in March. The company employs about 3500 people.
SSTL's revenue rose 72% to Rs 407 crore last quarter from Rs 236 crore in the corresponding quarter of 2011.
Speaking to ET, SSTL President and CEO Vsevolod Rozanov said the company is suffering a loss of $1.5 million a day, and that the patience of its investors was slowly running out, with respect to clarity about the firm's future in India. SSTL operates under the brand MTS in India and has invested about $3.2 billion in the business till date.
During the first quarter of FY12, SSTL suffered losses of Rs 528 crore. "We have put on hold all investments in our voice business and are concentrating on data services, which are the core to our business now," he said. MTS India has about 1.5 million customers for its data services that are available via USB dongles and internet plans.
Russia, which holds a 17% stake in SSTL, formed a special working group this week under the lower House of its Parliament to protect the interests of Russian companiesworking in India. Russian government invested $600 million in 2010 in SSTL.
Rozanov indicated that MTS voice customers will remain unaffected for the time being. A decision on voice services will be taken only after auctions are over. MTS India was one of the operators impacted by cancellation of 122 telecom licences by the Supreme Court in February.
Rozanov also raised the issue of high base price for bidding for spectrum proposed by Trai. "It will actually kill the full CDMA ecosystem. Most operators will not be able to bid," Rozanov said. Telecom regulator Trai has proposed a base rate of Rs 3,622 crore per MHz.
"It has become very difficult to do business for us. For CDMA operations significant Capex is required. And our partners are very concerned about the future of our voice business," he said. Rozanov says SSTL for the year 2012-13 has made many alternative business plans and would execute them with changes in the policy scenario in India.
With respect to its licence cancellation, SSTL has filed a curative petition with the Supreme Court asking for a review. "We have petitioned saying that our name was not even indicted in the CAG reported. We should not be clubbed with others," he said.
The issue with respect to SSTL's future in India was also raised with India by the Russian President Vladimir Putin during his visit to New Delhi in March. The company employs about 3500 people.
SSTL's revenue rose 72% to Rs 407 crore last quarter from Rs 236 crore in the corresponding quarter of 2011.
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