Friday Review: Hooking up and pulling out

With mobile madness far behind us, this week in telecoms was all about who is getting into bed with whom, and who else is walking out on what.

Talk of tie-ups was high on the agenda on Wednesday in particular, when the Indian press re-ignited years-old talk of a merger between state-owned telcos BSNL and MTNL. The Business Standard reported that in a draft plan the Department of Telecommunications (DoT) expressed concerns over the deteriorating performance of the two telcos, while highlighting the possible synergies that could be achieved from merging their complementary operations.

Indeed, with MTNL solely operating in Delhi and Mumbai and sister company BSNL serving the rest of the country with the exception of those two areas, the benefits of combining the pair's operations seem obvious. However, talks that began some time ago and went on for many years were ultimately abandoned when differences in organisational structure and MTNL's status as a listed company proved insurmountable. According to the paper, this latest DoT proposal gains added significance since the oft-discussed merger plan "was given a quiet burial under former telecom minister A Raja for the last three years".

Andimuthu Raja, meanwhile, will be held in judicial custody in relation to India's mobile spectrum allocation scandal until 3 March. The questioning of a number of telecoms execs in India over the same issue was one of many telecoms-related news stories to come out of the subcontinent this week. More on those later. In the meantime, we will wait and see if anything comes of the BSNL/MTNL proposal this time. One thing is certain: the state-owned telcos will have to do something special – and quickly – if they are ever to regain ground against the country's private players in the mobile space.

Also on Wednesday, China Telecom and Chunghwa Telecom agreed a trans-South China Sea partnership. Details of the deal are sketchy: the Chinese and Taiwanese operators signed an MoU on developing business opportunities in Taiwan's western economic zone, and an agreement to "exploit energy-saving market opportunities in Fujian district [in China]," according to a Taiwan stock exchange filing.

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