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Aircel Plans Mobile App Store, Tower Sale

Light Reading
News Analysis
Light Reading
1/5/2010
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Indian mobile operator Aircel Ltd. made two significant news announcements today: It unveiled plans to open its own mobile applications store, the country's first; and it revealed plans to sell its network of mobile towers.

Aircel, the country's seventh largest carrier, with nearly 30 million customers at the end of November, has teamed up with IT services giant Infosys Technologies Ltd. (Nasdaq: INFY) to create its mobile apps store, which will offer applications related to health, finance, and entertainment.

The carrier is basing its store on the Flypp application platform, unveiled by Infosys in mid-December. The IT firm is offering Flypp to mobile operators as a hosted, white-label service, and is encouraging apps developers to create new products that can be added to the platform and sold on a revenue sharing basis.

Financial details of Aircel's deal with Infosys were not revealed.

The move is important, because India's operators need to develop their value-added services offerings to help boost their income, as intense competition and the introduction of pay-per-second tariffs have put the squeeze on voice revenues.

Aircel, which is majority owned by Malaysia's Maxis Communications Bhd. , also revealed plans to sell its 17,000-plus telecom towers. "The deal is likely to be finalized in the coming four to six weeks," Gurdeep Singh, Aircel's chief operating officer, told reporters at a press conference Tuesday.

Singh says the operator is in talks with three potential buyers. According to industry sources, mobile tower operators GTL Infrastructure Ltd. , Tata Quippo (formed a year ago), and Bharti Infratel, a subsidiary of India's largest mobile operator, Bharti Airtel Ltd. (Mumbai: BHARTIARTL), are the companies engaged in negotiations with Aircel, which is believed to be seeking around $2 billion for its towers. (See Tata, Quippo Merge Towers.)

Aircel's COO, however, declined to outline his company's strategy for the upcoming auction of 3G spectrum, which is set to take place in the next few months. (See Asia Watch: India 3G Update.)

— Gagandeep Kaur, India Editor, Light Reading

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