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(Phone rings)

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Venkat: Hell.o
Niira Radia: Venkat, hi.
Venkat: Hi
Niira: Can you talk?

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Venkat: Yeah, yeah, tell me
Niira Radia: I just wanted to check one thing with you, we've got a call from uh... R.S. Thakur to go to TACO [Tata AutoComp]. I believe Mr. Tata has given some clearances on uh, is it some of the JVs being disbanded, right?

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Venkat: Yes, that's right.
Niira Radia: I just wanted to get a heads up from you because earlier we were briefed by TACO on it and I just wanted to get a heads up from you in terms of what was the final approval that's being given so that before I meet him on Monday, I know what is the plan for media that one needs to adopt.

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Venkat: I don't know the details. Either Mr. [inaudible] or Mr. Gopal can fill in.
Niira Radia: OK, I will talk to them.

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Venkat: But thing is yeah, that Mr. Tata's no longer the chairman of TACO, so...
Niira Radia: I know that, yeah.

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Venkat: Yeah
Niira Radia: Okay, okay, are you gonna be in office later?

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Venkat: Yeah, I am there in office. I might be back a little late but otherwise...
Niira Radia: You are with Mr. Tata, right? I need to brief him on Telecom, haan, just let him know.

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Venkat: Yeah, just one second.
Niira Radia: Yeah, ok.

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Ratan Tata: Hi.
Niira Radia: Hi, how are you?
Ratan Tata: Fine, thanks.

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Niira Radia: I haven't troubled you last few days, I said let me call you once. I was hoping to come to Bombay but then I know you are not going to go away next week, you aren't there next week.
Ratan Tata: I am going away day after tomorrow.

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Niira Radia: Right, I was going to come on Sunday but then I remembered that you aren't there next week so I thought let me try to shift my travel to come week after, when you are there.
Ratan Tata: Okay.

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Niira Radia: Is that going to be okay?
Ratan Tata: Yes, that's fine.

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Niira Radia: Yeah? Would I get a chance to meet you.
Ratan Tata: Yes, of course.

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Niira Radia: See I just need to brief you on Telecom. But maybe, shall I speak to you when you are at home in the evening, would that be better?
Ratan Tata: No, I am in the car, it's up to you...yeah...

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Niira Radia: Ok. I just, just...Ravi and I had... I mean Anil and I had gone to meet up with minister.
Ratan Tata: Yeah.

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Niira Radia: And I have been meeting him separately on um...The sense I am getting and I'm uh, why this is is moving ahead as far as 3G is concerned...
Ratan Tata: Yeah.

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Niira Radia: ...the sense I am getting is that he seems to be pretty hellbent on this  6.25 MHtz to go to Anil Ambani.
Ratan Tata: Uh huh.

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Niira Radia: And I have told him that we will oppose it vehemently, it will not, you know - unless we get all our spectrum. So we have moved 2-3 processes. One is that we want harmonisation of spectrum to start so that they can - with harmonisation taking place, a lot of the spectrum will get clear in some of the areas.
Ratan Tata: Uh huh.

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Niira Radia: The second thing I have said to him is that there is about 5 MHtz that is coming in from Defence on 2G.
Ratan Tata: Yeah.

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Niira Radia: What I am proposing to him is that you first give us our 4.4 in Delhi on that.
Ratan Tata: Yeah.

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Niira Radia: - Because that holds us up. But I...uh...We've moved 3-4 processes separately with the department, I have met Dr. Sarma also. But the sense I am getting is that Dr. Sarma will not say no to his own judgment. He's been given the uh...the minister's gonna involve him in the consultation process.
Ratan Tata: Yeah.

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Niira Radia: On this whole 6.25 issue...
Ratan Tata: Yeah.

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Niira Radia: I have - And given that it was Dr. Sarma's own judgment in TDSAT that they are relying on, he is not going to, you know obviously contradict his own judgment. So I told you...
Ratan Tata: And his judgment is 6.25?

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Niira Radia: Correct, yeah.
Ratan Tata: I see.

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Niira Radia: It's 6.25, meaning that the...uh...DoC's recent committee has given a report, which was set up during a time when the election process was on, which said that we should limit it to 4.4 as being the licence condition and then thereafer we should just move to proceeding towards either a fee-determined model which is what you had earlier you had proposed in the 3G segment but in the case of 2G also they are saying let's agree on a fee, and what is the basis we agree on that fee, let's work out whether it is cap-ex or op-ex or over a period of time or whether it they're looking at uh -

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Ratan Tata: - But uh, would Sarma subscribe to a view that 6.25 would only give it to one person?

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Niira Radia: No, what Dr. Sarma has done is, it's a very clever judgment, Ratan. The judgment says your licence condition earlier used to be limited to 4.4 and then you were entitled to another 1.8 which took you up to 6.2. The 1.8 - Between the 4.4 and the 1.8 additional was the root of subscriber base.
Ratan Tata: Yeah.

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Niira Radia: So you got 4.4 as your entitlement when you became a licence holder.
Ratan Tata: Yeah.

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Niira Radia: ...and then thereafter you had to have X amount of subscribers to qualify for additional 1.8.
Ratan Tata: Yeah.

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Niira Radia: What has happened here is that Dr. Sarma's view is, in the judgement, that all subscribers...uh, that all licence holders should be entitled to 6.25 in any case so that they can plan their network.

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Ratan Tata: Yeah.
Niira Radia: And thereafter there should be an agreed fee-determination that should take place. And what is that fee can be determined either be through an auction route or it can be through a model of what has been an cap-ex and op-ex [?] spend that you've had to incur if you were taking spectrum up.

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Niira Radia: And all work out... Basically, he's given two to three different formulas that one could apply which would in fact all end up taking your AGRs [?] up to 9 to 12 %.
Ratan Tata: Yeah.

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Niira Radia: The challenge is that whilst he's given a very innocent, uh, judgement, the other side has upped the subscriber-base by having false subscribers. For example, today, in Jammu they have been deactivated by 36,000 of connections because they were supplying them to militants. And they were doing all sorts of wrong stuff. I know, we know that their subscriber-base is fudged almost to 50%. 
Ratan Tata: Yeah.

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Niira Radia: By giving false subscriber-base, where Dr. Sarma is silent in his judgement on that, they will be able to secure 6.25 in all circles and they'd almost end up jumping the queue again.

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Niira Radia: So I told Raja that your 6.25 can only happen to one party if Anil Ambani...if first Tata Teleservices...as from my point of view is the second licence, if you've given Anil Ambani already 4.4, we are entitled to spectrum after that immediately. But, actually, my first complaint is that, no, we were entitled as #...
Ratan Tata: Yeah.

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Niira Radia: But you have now made a fait accompli and given them 4.4, okay? So okay, before you give Unitech, before you give Swan, before you give anybody else, we should be the first in queue because as far as we are concerned, dual technology was an existing licence for all and in your criteria, when you made submission to court, you said 'existing licence holders' first.

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Niira Radia: So we automatically get entitled to that and then after that whether Sunil Mittal gets 1 MHz in Delhi or whatever, then the new licences operate. He...there is an interpretation issue on that and they are playing very cleverly on it again... So my worry is that after they give 6.25 to Anil Ambani...
Ratan Tata: Mmhmmm.

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Niira Radia: ...including in Delhi, because he has just gone in and put in an application for Delhi and key metros, and we will be struggling because there is only 5 MHz being released by Defence for Delhi and we will be again struggling...
Ratan Tata: Yeah.

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Niira Radia: ...Because we would not have built up our subscriber base any case, between 4.4 and 6.25, because we are just launching now.
Ratan Tata: Yeah.

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Niira Radia: And we are not doing fudging like they have done.
Ratan Tata: Yeah.

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Niira Radia: So they will now make us wait another year and a half to two years for getting spectrum. So I am saying to Raja that the moment you shift from this - because there is an interpretation, and I have said this to Dr. Sarma also, I said Dr. Sarma don't take this report because you will have no credibility because you have already given a judgement and you can't be doing this report because you are in conflict technically speaking because y'know you are looking at your judgement again this time as TRAI...So there is a grey area there.

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Ratan Tata: You need to find a way that he doesn't oppose this judgment and you still gives you what you believe is right.
Niira Radia: Which is why I told him I told him that if you say you give me 6.25...er, that you are going to give the other side 6.25 first, please first assure me that there is 4.4 available for us everywhere else...everywhere that we are entitled to get. When we do our sums on the spectrum spread that is available, we get stuck in Delhi and some key areas.

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Ratan Tata: Yeah because if he, if he...finds a way to oppose his judgment and clarifies that in the fairness of things, everyone should get the base of 4.4.
Niira Radia: 4.4... yeah, that's what I am telling him Ratan and that's what he is not in agreement with.

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Ratan Tata: Why?
Niira Radia: Neither Raja nor him are in agreement because his basic premise is that I think the operators must have 6.25 because that is what his judgment says they should have 6.25  even if that's on subscriber base.

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Ratan Tata: That's fine but there's no sense in this if spectrum is not available -
Niira Radia: Hmmm.

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Ratan Tata: - that you stick by that so that  only one subscriber gets it.
Niira Radia: No, he is giving us another carrot and that is if you go to TDSAT now you will get helped and you come to me somehow and I will say that you were second in the queue and that operators like Swan and Telenor who should not have got spectrum...or Unitech who would not have got Spectrum because it was not rolled down, their spectrum should be taken away and given to us. I said nobody is gonna allow that to happen because they will get a stay.

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Ratan Tata: Yeah
Niira Radia: They'll go to Supreme Court and they will buy their way through a stay and we'll never get it so don't show us something which you and I know is not going to happen. So when I went to Anil Sardana on Monday and took him to meet the minister on Tuesday, I told him that, I said don't accept this because this is just...they're just showing you a route which is going to be unacceptable, let's look at what's available on the ground...the moment we allow 6.25, we are stuck.

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Niira Radia: So this is um, so, I just wanted to tell you that this is - I am seeing him again. Raja's promised me that he's not going to do anything in a hurry, which I think he will not. I made Kani speak to him as well. He's not going to do anything in a hurry at all, he's promised that. So we've got some time and we're...I am gonna to meet Dr Sarma again on Monday.

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Niira Radia: I'g gonna try not to come to Bombay and finish this in the course of next week. I just wanted to tell you that this is actually what's actually going on on the ground so, I wanna go with this thing that 4.4 is the entitlement and everyone must get that before we even start talking on 6.25.

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Ratan Tata: Yeah, but  if he can word it uh, so that he agrees to 6.25 but he just makes this a precondition -
Niira Radia: Yeah.

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Ratan Tata: - or clarifies that it would be fair that this be so otherwise it would be a monopoly -
Niira Radia: Hmmm.

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Ratan Tata: - or not a monopoly...but a... a .. disparity...
Niira Radia: Disparity, yeah. It's a grave disparity, it's crazy, Ratan, and I mean...y'know, they are getting VTMs in various cricles to agree to their figures which are fudged, you know. And there's no way, and uh there has to be a mechanism of actually verifying subscribers, of all operators.

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Niira Radia: I mean, they are saying, fine, y'know, we are comfortable if you verify our subscribers also, we have no problems with that as long as we can launch a service and you don't put us at a disadvantage. we need our basic 4.4 to even launch.

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Ratan Tata: Yeah.
Niira Radia: So, yeah, that's the sort of thought process. Just want to tell you that Round II of the Telecom battle starts. Of I don’t know how many rounds -

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Ratan Tata: I’m surprised that Raja after all that you supposedly did for him is playing this game.
Niira Radia: No I met...I explained to Kani. I met her yesterday on the way home last evening. I told her, Kani, look, this is what is happening. You need to have to have a word with him.

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Niira Radia: And so...She said, give me a note and I'm gonna just call him up and tell him that he has to behave. He (Raja) very clearly told me, he said, 'Niira, how can I go against what the court has said?"  I said, ‘Hello, Mr Raja, you can go against the court. You don’t have to accept what the court has said because 4.4 (megahertz) is what the licence entitlement is and it’s for you to interpret.’ So there is this little game going on.

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Ratan Tata: But now with the new attorney-general or whatever he is -
Niira Radia: No, Ratan, that’s a good thing. I’ll tell you why—because he can only handle constitutional matters. The  Solicitor-General is the gentleman—I told you about the swimming pool thing—Gopal Subramaniam. He’s the guy who has to do the interpretation.

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Ratan Tata: I see.
Niira Radia: I’m going to see him. I sent him a message and he said he will call back at around 5.30-6 when he gets free and he reaches home. So I'm gonna go and brief him...because...he hates them (the Anil Ambani group). I’m not sure he's not gonna, you know, just agree to what they say.

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Ratan Tata: Yeah.
Niira Radia: He’s a very upright person.

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Ratan Tata: Uh huh.
Niira Radia: He's not gonna accept, accept uh...I gotta find a way of getting it referred to...I think Raja's gonna try and sort of bring in the Attorney General. He briefed Prime Minister yesterday, he did brief Prime Minister on 3G cabinet note and doesn’t want to go to the GoM anymore. I think that's a bit of a hogwash.

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Ratan Tata: Uh huh.
Niira Radia: Because I think they’ll start doing all this drama but they're not gonna go for 3G spec - auctioning before March next year.

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Ratan Tata: Uh huh.
Niira Radia: I don't think gonna do it in a hurry.

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Ratan Tata: Uh huh.
Niira Radia: And the only reason they want to do 6.25 (MHZ) for Anil is so that he can get AT&T to buy into his company. AT&T is talking to him right now, Ratan.

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Ratan Tata: I see...
Niira Radia: Yeah, coz he needs an equity partner otherwise he can’t survive with the debt he’s got. His avenues have closed on raising more money unless he fudges some other things and raises money.

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Ratan Tata: Why isn’t all of this getting exposed, in fact, why - ?
Niira Radia: Ratan, they’re buying up the media. And they’re using their buying power with the media for every ad they place. You should...I...I can’t explain to you the amount discussions I have with the media everyday, particularly the Times Group including Dainik Bhaskar—the Aggarwal guys who came and met you....

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Ratan Tata: Yeah.
Niira Radia: They say, Niira, every time we do a negative story on them, they withdraw advertising. So, I said, fine, but then you know, others can also withdraw advertising, and you know,s o just because we are upright about how we do things and we don't leverage...they leverage every dollar of their media-spend to ensure they don’t get any negative publicity I am sitting on, you know, the sort of stuff, you know, that I've got is unbelievable and the same thing.

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Niira Radia: I've made even Mukesh's people talk to them but then ultimately it's come down to um uh...the media-spend. We need leverage with the media.  The media has become very, very greedy...It will eventually come out, when a Satyam happens, then all the you know, all the barriers get broken, then it's a different thing altogether, then everybody starts saying, oh we have to mend his integrity, we are this thing (sic), but they are as bad as them.

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Niira Radia: I have already, y'know, very quietly, through journalists who are straightforward, I have done a lot of stories already. All on his debt, I have had most of the analysts community writing reports on it which is being circulated and all that...through analysts, like UBS has done a report, Kotak has done a report, McQuiry has done a report...on both the Power sector as well as Telecom in which...in that he's got huge problems that his [?] are not correct, his revenue figures seem to be a little problematic and that he would find it difficult to raise any further funds.

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Niira Radia: So all that is already there, but what happens: the media doesn't carry that, or when they do carry, they carry it so that they don't get - they dilute it because he's there sitting on their heads, he's got two people just monitoring (inaudible) play in the media. So I am saying to Anil, I told Anil Sardana also the same thing -

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Niira Radia: I said, let's be..we have have to advertise because it's our brand and we do what we have to do, but we gonna have to also start - we have to leverage some part of it, you know, we need to tighten this thing...I can't work in isolation, working in isolation is causing this challenge. I told Raja very clearly that you are going to have negative press because, anything above - because you give this guy 6.25 (inaudible). Because Sunil Mittal is not going to sit quiet. And he's told me that he's not going to sit quiet.

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(silence)

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Ratan Tata: Hmm.
Niira Radia: So there's um...let me...so I will talk to Anil again...Anil... he and I were supposed to touch base today...

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Ratan Tata: Yeah.
Niira Radia: But I am meeting, Ratan, everyone I am required to meet. I don't think the report will happen in a hurry so we will go through a consultation process.

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Ratan Tata: Okay.
Niira Radia: So let's see what we can uh, best do. We'll be aggressive about our approach.

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Ratan Tata: Okay.
Niira Radia: Yeah? I will see you then when you are back.

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Ratan Tata: Yeah.
Niira Radia: OK then.
(Tape ends)

