India’s Tata mobitel and Hughes Tele.com to merge

NEW DELHI, India—The continuing consolidation trend in India’s cellular industry is now spilling over to basic service providers as well. Tata Teleservices—provider of CDMA-based limited mobility services under the “Tata mobitel” brand in Andhra Pradesh state circle—and Hughes Tele.com, a basic service provider in the Maharashtra circle, have decided to merge.
Hughes Network Systems, a shareholder of Hughes Tele.com (India) Ltd. and Tata Industries Ltd., a shareholder of Tata Teleservices Ltd. have signed a memorandum of understanding (MoU) for a “combination” concerning the basic telephony services in relation to the existing licenses of Hughes in Maharashtra and of Tata in Andhra Pradesh, a statement from Tata said. The MoU is subject to approval of shareholders and regulatory authorities.
Tata’s limited mobility service is available to customers in geographical areas defined as “Short Distance Charging Area” in a radius of 20 kilometers to 40 kilometers. It is called “Limited Mobility” as it does not have the roaming facility that is offered by a cellular phone. Since it is defined as a basic phone, it attracts low call charges, which are applicable to basic fixed phones. The company has a total of 36,500 wireless customers—33,000 fixed wireless customers and about 3,500 Tata mobitel customers. Hughes Tele.com too offers wireless-based basic telephony products in Maharashtra.