Cabinet approves scheme for National Optical Fibre Network

New Delhi: The Union Cabinet today approved a scheme to set up a National Optical Fibre Network (NOFN), which will be used to provide broadband connectivity to village-level bodies — Panchayats. The project cost is expected to be “of the order of Rs 20,000 crore”. A special purpose vehicle (SPV) will be formed to execute the network. “Immediately, the equity in SPV will be from the Government,” Mr R. Chandrashekhar, Secretary, Department of Telecom (DoT), said. Subsequently, he said, BSNL, Railtel, PGCIL and GAIL are likely to be roped in as equity partners. “The details are being worked out. The funding for the project will be done through Universal Service Obligation (USO) fund. The USO fund accruals over the next two-three years will cover the finances,” he said. “At present, the optical fibre cables reach the block headquarters mostly. Now they will reach the Panchayat level…. The incremental layout will be done through the SPV.” The Government has set a target to complete the roll-out in about two years. The SPV will get revenues by charging its customers access charges according to the TRAI guidelines. The key requirement is to get the right of way (RoW) from the State Governments as they have varying rules and charges for providing it. “We will have tripartite agreements between the executing agency, State Government and the Department of Telecom. The State Governments are expected to contribute by providing free RoW,” Mr Chandrashekhar said.

Govt clears manufacturing policy

New Delhi: The much-awaited National Manufacturing Policy was approved on Tuesday by the Union Cabinet. It comes at a time when the country is facing a slowdown in manufacturing and industrial growth. The policy aims to create 100 million jobs within a decade and increase the share of manufacturing in the country's GDP to 25 per cent by 2022 from the current 15-16 per cent (a level that has been stagnant since 1980). Among the key instruments for realising these goals is the setting up of National Investment and Manufacturing Zones (NIMZ). The minimum land area of each NIMZ – or greenfield integrated industrial townships with the modern infrastructure – is to be 5,000 hectares. Announcing the policy, the Commerce, Industry and Textiles Minister, Mr Anand Sharma, told reporters that, “No cultivable, agricultural and forest land will be allowed to be acquired for NIMZs.” The first phase of the NIMZ will be established along the Delhi Mumbai Industrial Corridor which will see early results in the next few years, he added. The policy also has a host of fiscal incentives mainly for the micro, small and medium enterprises. In this regard, an official statement said, “Individuals will be eligible for relief on long-term capital gains tax if the sale proceeds of a residential property are reinvested in equity of a new start-up company,” adding that tax pass through status for venture capital fund will be available if they focus on manufacturing. The other significant features are the single window clearance mechanism to cut red-tape and the high-priority for skill development. “Private sector will be given standard deduction of 150 per cent of expenditure for skill development institutes,” the statement said. The policy was finalised after over 20 months of intense stakeholder consultations. These discussions had seen difference of opinion, notably from the Ministries of Environment and Labour. Green focus With a view to protect the interests of labour in cases of closure of units, the policy has a mechanism of fund to insure the workers against such loss. The policy also features third party inspections in addition to inspections by Government agencies for compliance of both environment and labour norms. The focus will also be on ‘green manufacturing'. In this regard, a Technology Acquisition Fund will be set up to acquire global technologies and build a patent pool especially for equipment manufacturing that seeks to reduce energy consumption. SMEs will be given access to this patent pool up to a maximum of Rs 20 lakhs for acquiring patented technologies, the statement said. The policy statement says that support will be given to employment-intensive industries to ensure job creation, adding that, “Special attention will be given to textiles and garments; leather and footwear; gems and jewellery; and food processing industries.”

UID evangelists set up business incubator

Three veterans from the technology sector who were previously advisers to Nandan Nilekani's unique identification ( UID) project have established a business incubator firm called Angel Prime in Bangalore to mentor and build startups right from the ideation stage. The three co-founders, Bala Parthasarathy, Shripati Acharya and Sanjay Swamy, between them have years of experience in technology giants like Cisco and HP and in setting up startups. Parthasarathy and Acharya were among the cofounders of Snapfish, the web-based photosharing and photo printing service that was bought by Hewlett-Packard in 2005. Swamy was CEO of mobile payment platform firmmChek between 2006 and 2010. The trio will act as general partners and have raised a fund from 12 individual investors. The investments they make are typically in the sub $1 million range and would be made in 2 to 4 companies at a time. Incubators provide mentorship services, offer real estate and infrastructure as well as industry contacts to the startup. They come in prior to the angel investor or venture capital (VC) investment stage, when the company is a mere business idea. They take stakes in these companies and could exit at a later stage when strategic investors enter. Parthasarathy said that Angel Prime would focus on the domain expertise of the team, which includes mobile payments, e-commerce as well as smart phone and tablet phone applications. He said they understand the common mistakes entrepreneurs make and can help them scale to a stage where they attract institutional funding. Angel Prime is currently incubating a startup in the mobile payments space, an announcement on which is expected within the next month. It will also unveil a company in the e-commerce space in the within 90 days, Parthasarathy said. Sachin Maheshwari, director at growth stage fund Zephyr Peacock, said that in India business incubators have generally been the forte of large government institutions like the IITs and IIMs. Outside of the universities, incubation is a relatively new phenomenon, the most notable being Morpheus and eBhana. Morpheus co-founder Sameer Guglani calls incubation outside of universities as accelerators. He said that universities primarily provide infrastructure and plug and play facilities on a rental basis, while accelerators add greater value through mentorship, contacts, funding etc. Business accelerators are popular in the US. Investments are made in different batches of say six months, after which the role of the accelerator becomes more consultative. Guglani said one major reason why the concept has not caught on in India is that it works on a fee or commission basis. As these funds are typically small in size, the earnings of general partners are not as lucrative as in the case of a VC fund. Morpheus for instance recently raised a new fund of Rs 6 crore. Despite this, more incubators are said to be in the works. Senior professionals from India and those returning from abroad are looking for something more exciting to do with their time. And thanks to the emergence of newer technologies, talented skill base and lower costs, the Indian entrepreneur is generally viewed as promising.

Android beats Apple iOS to become app leader

Google Inc's Android operating system passed Apple Inc's iOS as the most popular software platform for application downloads as consumers bought more Androidsmartphones. The Google platform accounted for 44 per cent of all app downloads in the second quarter, eclipsing Apple's 31 per cent share, according to ABI Research. That was fueled by a 36 per cent jump in Android phone shipments from the previous three months, ABI said. Google, based in Mountain View, California, introduced Android in 2007 as an open-source platform, allowing any phone maker to use it for free and focus on designing hardware rather than software. Android has helped propel Samsung Electronics Co into the ranks of top smartphone makers and drive a recovery at Motorola Mobility Holdings Inc even as sales of Apple's iPhone surged. "Android's app downloads per user still lag behind Apple's by 2 to 1," said Dan Shey, practice director of mobile services at ABI. Global downloads of games, music, news and other apps are expected to rise to 29 billion this year, more than triple the 9 billion downloaded in 2010, ABI said.

Olympus blasts ex-CEO

Olympus Corp lashed out at its former chief executive officer for publicly questioning $687 million in advisory fees for a 2008 takeover, saying he used his position "to leak internal company secrets" and was "trying to ruin the credibility of Olympus." The Japanese camera maker also said it was "hard to forgive" Michael C. Woodford, whom it fired as CEO on October 14, and the company was "naturally considering legal action," according to a letter posted on its internal website yesterday, a copy of which was obtained by Bloomberg News. The statement came after Olympus employees received an e- mail saying Chairman Tsuyoshi Kikukawa would respond to allegations by Woodford, according to two people who declined to be named because they were not authorized to speak for the company. Olympus last week said it was forming an independent committee to investigate previous acquisitions after demands from Nippon Life Insurance Co., its largest shareholder, and Southeastern Asset Management Inc. to explain the fees paid in its $2 billion takeover of Gyrus Group Plc. "I am sure you all want to know more," the statement said. "I will continue to speak out. My next message will be about Gyrus."

Why Obama Needs Social Media to Win in 2012

It’s no secret that President Obama’s 2008 campaign success was due in large part to the overwhelming support of voters age 29 and younger (66%). By all accounts, winning a second term will be almost impossible without that demographic’s continued support. On the other hand, securing the youth vote will be challenging. As a voting bloc they are historically unpredictable, and their approval of the president has dropped 13 pointssince June. To counter his waning popularity, the president’s campaign, Organizing for America (OFA), will need to deploy a social media strategy that combines innovative outreach techniques with a focus on youth turnout. Before addressing the “must-haves” for the president’s digital strategy, it’s important to understand said demographic, both as a consumer and as a voter. Not surprisingly, this audience dominates the online and social networking space. A recent Pew Research Center survey found that 83% of Internet users ages 18-29 use social networking sites. The percentage drops off significantly as the age range increases (only 51% of those between the ages of 50 and 64). Second, according to the most recent census, voters ages 24 and younger made up 10% of voters in 2008, and were the only age bloc that increased its participation since 2004. Finally, a staggering number of people age 20-29 do not have jobs. The Census Bureau found that in 2010, one in three were unemployed. As a result, this demographic presents an enormous challenge as well as an opportunity for OFA. The president must connect with this group and make his case for why they should support him as strongly as they did three years ago. After Obama’s 2008 victory, OFA received widespread praise for its social media strategy. This admiration was deserved, mainly because OFA implemented a tool that was foreign to almost everyone else in professional politics. David Axelrod, top strategist for the 2012 campaign and former senior advisor to the president, acknowledged that “so much of our support [in 2008] came from younger, more wired people.”

BSNL and others to build Rs 20k cr broadband network

The telecom ministry has accepted the finance ministry's stance that state-owned BSNL must not be entrusted with the 20,000-crore project to build a nationalbroadband network to take high-speed internet to the hinterlands. A special purpose vehicle (SPV) with equity participation from state-owned telcos BSNL and MTNL and other public sector units such asRailTel, Gail and PowerGrid, among others, will now undertake this project as demanded by the finance ministry. This initiative involves laying 11 lakh km of optic fibre network connecting over 2.5 lakh panchayats across the country. The Department of Telecom (DoT) in its proposal to the Cabinet has said that private players would be 'inducted' into the SPV by equity expansion at a later date. "This stage could be considered at any point when it is felt that it would add value to the objectives of the programme," the Cabinet note seeking approval for this project added. In July, communications and IT minister Kapil Sibal had said that the telecom commission, the apex decision making body of the department, had approved the project to build this network that would connect all the gram panchayats utilising the Universal Service Obligation Fund (USOF). Sibal said that the initial phase of this project would cost about Rs 20,000 crore and added that a similar amount of investment was likely from the private sector towards this. Telecom companies contribute 5% of their annual revenues towards this fund, which is used to support rural telephony, and the unutilised amount in this kitty is estimated to be about Rs 20,000 crore and this is expected to increase to Rs 36,000 crore within the next 36 months. But the proposal was delayed after the finance ministry raised concerns on the agency that would implement it. The DoT shared the view that an SPV should only be created for managing the fibre network after it is built by BSNL. The finance ministry, on the other hand, had demanded that the SPV be entrusted with both the rollout and managing the network. The DoT in its Cabinet note has also added that it had already formed a high-level committee (HLC) and an advisory body to oversee the project. "The project implementation team consisting of members of BSNL, PowerGrid, RailTel, National Informatics Centre and C-DoT is presently looking after various preparatory activities such as geographic information systems mapping, finalisation of network design etc.

IAF selects Boeing's Apache Longbow combat helicopter for chopper tender

NEW DELHI: The Indian Air Force (IAF) has selected Boeing's Apache Longbow advanced attack helicopter for its combat chopper tender. RIA Novosti news agency reported from Moscow Tuesday that the other competitor, Russia's Mi-28N Night Hunter, had lost the competition. It quoted an unnamed Indian defence ministry source as saying that the US helicopter "showed better performance" while the Russian machine did not meet the tender requirements. There was no confirmation here but well placed sources told India Strategic defence magazine that IAF's assessment report had been accepted. No details were given. IAF has a tender for 22 combat helicopters with no options. But more would be required and should be ordered once the first few machines are delivered. According to Lt Gen (retd) B.S. Pawar, a noted authority on combat helicopters, Apache is far more advanced than other attack helicopter worldwide. It has executed successful missions in Afghanistan. Notably, the US is known to have much better Electronic Warfare capability than perhaps any other nation. The Apache has the capability to detect 256 moving targets in speed, distance and direction and engage them as required. The twin-engine tandem seat Apache is operated by two pilots, and can execute an attack within 30 seconds of an alert. It is equipped with Northrop Grumman's highly sophisticated millimeter wave Longbow fire control radar and Lockheed Martin's Hellfire and Raytheon's Stinger missiles. The Block III is the latest version being delivered to the US Army from this year. Apache has a strong shell made of composite fibres to protect the pilots and sensitive components from bullets.

TRAI imposes 5 paise termination charge on commercial SMSes

NEW DELHI: In a bid to further clamp down pesky SMSes, the Telecom Regulatory Authority of India (TRAI) will impose a termination charge of 5 paise per SMS on operators from whose networks commercial messages originate. Termination charges are paid by an operator from whose network calls or SMS originate to the one on whose network these communications end. These charges impact tariffs. "The promotional SMS charge shall be Re 0.05 (five paisa only). The Originating Access provider may collect the promotional SMS charge from the registered telemarketer," TRAI said in a notification. After much delay, TRAI in September this year came out with recommendations to stop pesky calls and text messages, directing that no operators will permit the transmission of more than 100 SMSes per day per SIM. The limit is, however, not applicable on 'blackout days' (festive occasions) and a customer is free to send as many messages he desires. Subscribers also have the option of choosing to be under the 'Fully Blocked' category, similar to the 'Do Not Call Registry' to not receive any promotional SMS or call. In case a user opts for 'Partially Blocked' category, he or she will receive SMS in only select categories. At present, some operators charge a termination fee of up to 15 paise per SMS. The current directive would make it mandatory for all operators to charge the termination levy for commercial SMSes. CDMA telecom operators have opposed the imposition of a termination charge on SMS, saying the move is anti-consumer, anti-competitive and not based on a scientific technical study. "Some of the incumbent GSM operators always propagate high termination charges for calls as well as on SMS, as it works in their favour. Imposition of any termination charge on SMS will be anti-competitive, anti-consumer and not based on costs," Auspi General Secretary S C Khanna had said in a letter to the Trai Chairman. He added that prices of bulk SMSes are currently 1.5 to 2 paise and if it shoots up to 7 paise per SMS, this important marketing avenue will be eliminated. "It would result in thousands losing their jobs as a result of this change in regulation, which will add to the plight of lower sections of society," Khanna said. TRAI has exempted select service providers --- primarily the dealers of telecom operators, DTH operators, e-ticketing agencies and social networking sites -- from the limit of 100 SMSes per day per SIM. It also includes transactional SMS' from e-commerce agencies, companies registered with SEBI, IRDA, Association of Mutual Funds in India (AMFI), NCDEX, and MCX; and goods delivery confirmation messages.

Retailers like Future Group, Lifestyle, Godrej, MegaMart, Fabindia offering 0% EMI to attract customers

KOLKATA/NEW DELHI: Retailers are countering the economic slowdown by offering interest-free equated monthly instalment (EMI) schemes, which they say are not only helping them pull customers into stores but also encouraging shoppers to buy higher value products. Such EMI-based sales promotions have staged a big comeback at a time near double-digit inflation has put a heavy strain on household budgets, making people defer non-urgent and big-ticket purchases even on credit because of hardening interest rates. But transactions carrying zero percent financing have grown more than 50% over the past year, say retailers and bankers. From apparel sellers such as Arvind Brand's MegaMart and Fabindia to multi-product retailers such as Future Group, Lifestyle and Godrej, firms reckon that zero-interest EMI options are the most effective discounts they can offer. While retailers end up bearing the interest for the duration of the credit extended, they see it as an acceptable cost of keeping the sales register ticking during the downturn. "EMI schemes are removing inhibitions and inducing consumers to splurge on big-ticket items," says Himanshu Chakrawarti, chief executive of Essar Group's Mobile Store, the country's largest mobile phone retailer. He says consumers going for six-month EMIs are buying handsets priced twice than they had initially planned and those going for nine-month to 12-month schemes are tripling their size of transaction. Almost a third of the high-end mobile phones, such as the iPhone and the latest models of Blackberry and Android-based phones, sold at the Mobile Store are paid for through instalments. The company, which rolled out EMI schemes at its 1,200 stores across the country over the past couple of months, recently became India's largest seller of BlackBerry smartphones. Instant approval of loans and minimal documentation help speed up EMI-based transactions, says Parag Rao, senior executive VP, HDFC Bank. He says the bank has seen a more than 100% spurt in this loan category over the past year with an average transaction of 30,000. "Since the amounts are much smaller compared to home or car loan, the EMIs don't pinch much," he says.