Etisalat has confirmed its exit from the Indian mobile market; three weeks after the India’s Supreme Court cancelled its licence, and is taking legal action against its local Indian partner Swan Telecom.

"The decision of the Supreme Court… has removed [our] ability to operate [in India]," Etisalat said in a statement yesterday. "As unanimously resolved by the board this evening, Etisalat DB will be taking steps to reduce operating costs, including the suspension of its network and services.”

Etisalat’s 15 Indian licences were among the 122 permits revoked earlier this month after being issued four years earlier under controversial circumstances. The licences were originally acquired by Etisalat’s Indian partner Swan Telecom. Etisalat then paid US$900 million in 2008 for its stake in the operator, renaming it Etisalat DB.

Two weeks ago, the UAE telco booked an impairment charge on its 2011 financial statements of AED3.04 billion (US$827 million) relating to its Indian assets – and laid blame at its local partner’s feet. “The Supreme Court decision relates to events that occurred in January 2008, well before December 2008 when Etisalat invested in Swan. Etisalat has no knowledge of what occurred in the licence application process for Swan, far less did it have any involvement.” Etisalat confirmed today it was suing Swan Telecom “for fraud and misrepresentation.”

Etisalat did not rule out bidding for the cancelled licences again, but said it would decide on any future activity in India "when there is clarity on the auction process and telecommunications policy and greater legal and regulatory certainty and stability."

Etisalat DB had 1.7 million mobile subscribers at year-end 2011.

Among the other foreign investors affected by the licence cancellations, Bahrain’s Batelco has announced it is looking to sell its stake in S Tel, while Norway’s Telenor is in dispute with its local partner (Unitech) and is reportedly looking to set up a new Indian subsidiary.

Shares in Bharti Airtel Ltd fell as much as four per cent today after Econet Wireless said it is seeking at least US$3.1 billion in damages in a dispute over ownership of the leading Indian mobile carrier’s Nigerian unit.

Bharti said it had no notice or details of any action by Econet seeking damages, but termed claims “grossly untrue and misleading”.

“… All such baseless claims are bound to be fully rejected. We have full faith in the Nigerian legal system,” Bharti said in a statement February 22.

Bharti paid US$9 billion in 2010 to acquire the mobile operations of Kuwait’s Zain Group in 15 African countries, including 65 per cent of the Nigerian unit to become the world’s fifth-largest mobile operator by subscribers.

A Nigerian court ruled on January 30 that Bharti’s ownership of the unit was “null and void” because co-founder and five per cent shareholder Econet had not been consulted on the transfer.

Nigeria contributes about 9.5 per cent to Bharti’s consolidated operating profit.

Batelco Group shareholders have approved a full-year cash dividend of BD57.6 million (US$152.8 million), which represents a 72 per cent pay-out at a value of 40 fils per share. The group already paid 20 fils per share during the third quarter of 2011 with the payment of the remaining 20 fils per share expected on March 6, 2012.

As announced earlier in the month, for the full-year 2011, the Batelco Group reported net profit of BD80 million versus BD86.8 million 2010, representing a decline of eight per cent. EBITDA for the year was BD126 million, representing a 39 per cent margin, versus EBITDA of BD146.2 million for 2010. The Group’s gross revenues stood at BD327.0 million for the year, down four per cent year-on-year.

As of December 31, 2011, Batelco Group was free of debt and had significant cash and bank balances of BD107.9 million, an increase of 24 per cent year-on-year.

Batelco reported the total group mobile customer base grew by 21 per cent in 2011 whilst broadband subscriber figures across the network increased by eight per cent. 2011 also saw the group achieve record contributions from overseas operations resulting from on-going diversification of its operations geographically. For the year, 37 per cent of revenues and 30 per cent of operating profit were sourced from markets outside Bahrain.

In spite of aggressive market competition in Bahrain and the first full-year of operations for the third mobile operator, the Batelco still maintained a nearly 44 per cent share of the mobile market and strong retention rates. Similarly the telco reported additional progress in the broadband segment in Bahrain where Batelco saw an increase of more than 50 per cent in its wireless broadband subscriber numbers for the year.

France Telecom has reported that its total customer base rose by eight per cent during the full year, reaching 226.3 million at the end of 2011.

However, revenues fell by 1.6 per cent to €45.28 billion (US$60 billion). Revenues were worst affected by declines in France and Poland. Excluding the impact of regulatory measures (€748 million), revenues were generally stable compared with the preceding year, despite the impact of the increase in VAT in France and unstable market conditions in Egypt and in Côte d’Ivoire.

Net profit also fell 20 per cent to €3.9 billion from €4.88 billion in 2010. The drop was largely due to the disposal of assets due to the creation of the Everything Everywhere JV in the UK formed through the merger of Orange UK and T-Mobile UK in April 2010.

Net income from continuing operations was basically flat.

CAPEX increased 3.3 per cent year-on-year to €5.77 billion, equal to 12.7 per cent of revenues, on a comparable basis, in line with the 2011-2013 trajectory.

Net debt was €32.33 billion at December 31, 2011.

New estimates from Ovum indicate that consumers’ increasing use of IP-based social messaging services on their smartphones cost telecom operators US$8.7 billion in lost SMS revenues in 2010, and US$13.9 billion in 2011.

In a new report, the research firm reveals that it expects the decline, representing nearly six per cent of total messaging revenue in 2010 and nine per cent in 2011, to continue as the popularity of messaging apps continues to grow. Ovum warns operators to rework their legacy services if they want to secure their future position in the messaging market.

However, despite the threat to messaging revenues, Ovum believes that the strong presence of social messaging should be looked upon as an opportunity.