The Telegraph
Since 1st March, 1999
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Mobile chastity belt broken

New Delhi, June 4: Code-breaking and corporate derring-do go hand in hand.

Reliance Infocomm, the telecom newbie that aims to grab a large swathe of the country’s telecom business, had thought it had licked the biggest problem in the cellular business — the churn.

Cellular firms have trouble hanging on to their fickle subscribers who are ready to dump their service provider and switch over to the rival service on the slightest whim.

Reliance thought it could beat the problem by handing out mobile handsets for its wireless in local loop (WiLL) service that carried an unbreakable code.

The aura of invincibility cracked yesterday when six executives of Tata Indicom in Hyderabad were arrested for tampering with handsets offered by Reliance and providing connection on the same phones to the subscribers who had migrated from Reliance services.

Unlike a global system for mobile communications (GSM)-based cellular mobile phone where a subscriber can change the subscriber identity module (SIM) card, in a code division multiple access (CDMA) phone which WiLL service providers hand out, the SIM is embedded in the phone with the number of the operator. As a result, the same CDMA phone cannot be used by a subscriber of Reliance if he moves to Tata Indicom.

However, grey market operators have stumbled on a new business of breaking the electronic serial number and the operators’ number of CDMA-based mobile phones offered by service providers like Bharat Sanchar Nigam Ltd, Mahanagar Telephone Nigam Ltd, Reliance Infocomm and Tata Indicom.

In addition, operators who are using CDMA technology-based handsets to offer limited mobile services seem to be welcoming handsets from other operators with “open access”.

“It is a simple procedure. Once we open the code and destroy it using a software, it is as good as a phone ready for use by any operator,” said a grey market operator in Delhi.

Reliance offers a package of Rs 3,350 — that is bundled with a CDMA handset of Rs 10,500 — for three years and a monthly rental of Rs 600.

A telecom analyst said: “This was bound to happen since the bundling has not been successful in many European countries. Three years is a long period. Customers are changing handsets every six months in India.”

A source in Tata said: “We have not encroached upon any operator. We give customers the option of coming to us with their handset and we can programme it. What happened in Hyderabad is sub judice.”

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