MTS to breakeven by 2014-2015

MTS, India's only operator which focuses on data-centric voice enabled strategy is planning to break even in all 9 circles by 2014 or first half of 2015.

Speaking on company's breakeven plan, Vsevolod Rozanov, president & CEO, Sistema Shyam TeleServices said "We plan to achieve breakeven by end of 2014 or first half of 2015. West Bengal circle has reached OIBDA (operating income before depreciation and amortization) breakeven in Q4, 2012. 6 out of 9 circles would reach OIBDA breakeven in mid 2014 while the remaining circles are expected to be breakeven in 2015 by significantly optimizing cost."

Speaking to Voice&Data about MTS strategy Vsevolod Rozanov said "The company is focusing on four things. First, there is a much stronger focus on smartphone. Second, we are catering to entry level voice.

Third, we will continue with the dongle business. Fourth, there would be an increased focus on value added services.

In terms of capex, the company is planning for US $20 million in 2013 and a similar amount in 2014. In capex the major focus is on IT and not network as the company has abundance of network equipment as it has deployed around 4,000 base stations across all circles.

Vsevolod also commented that Gujarat, Uttar Pradesh (W), and Kerala circles the focus will be on data services. Going forward in the experimental circles, MTS will not focus on voice but only data.

With technology neutrality license, the company is planning for LTE migration using 850 MHz when the market is ready and when there is a a demand for LTE services in the country. The company is looking at LTE rollout expenditures to the tune of US $200 million with potential synergies of US $100 million.

Ranjan Banerjee, head of strategy, Sistema Shyam TeleServices said "As the market becomes ready and the eco-system develops, we will go for a commercial launch of LTE."

The company has already invested US $3.6 billion in the Indian market till date and the focus is on reviving the business.

If spectrum prices are lowered, it opens opportunity for MTS added Vsevolod.