Is it too late to introduce 3G in India?
Finally, the much-delayed 3G auctions will take place in India next month. Nine players will participate in the auctions for pan-India 3G spectrum, which will begin Apr. 9. In addition, the Department of Telecommunications, Government of India, has received 11 applications for auctions of broadband wireless access (BWA) spectrum. In all, there are 20 applications.
Most of the players taking part in the auctions are existing 2G players--Aircel, Bharti, Etisalat, Idea, Reliance Telecom, S Tel, Tata Teleservices, Vodafone and Videocon Telecom. The BWA list has four new players--Augere, Tikona Wireless, Infotel Broadband Services and Qualcomm.
Importantly, global bidders are staying away from the auction. Perhaps, they found the reserve price for pan-India 3G spectrum--at US$769 million (INR 35000 million)--high, given the various challenges that grip the Indian telecom industry (low average revenue per user, low tariffs, high competition in each circle, etc) today.
The world moved to 3G nearly five to nine years back. For instance, 3G was introduced in Japan and Europe in 2001, in South Korea and Australia in 2002 and in the U.S. in 2003.
Today, the world is getting ready to move on to 4G, and the Indian telecom regulator is aware of this. The Telecom Regulatory Authority of India (TRAI) has initiated discussions on the introduction of a Fourth Generation (4G) mobile standard in the country, and is preparing a consultation paper on mobile wireless broadband services based on the International Mobile Telecommunications-Advanced (IMT-Advanced) standard proposed by the International Telecommunications Union.
The 4G networks will allow users to stream mobile multimedia, such as TV broadcasts and online games, with speeds of up to 10 times that of 3G networks. The 4G technologies are designed for services such as high-speed Internet connectivity, streaming multimedia services such as TV broadcasting, real-time high-resolution videoconferencing and multimedia-based mobile commerce, to be delivered anytime, anywhere using the ubiquitous Internet Protocol (IP). It is also completely interoperable across various types of 2G and 3G networks. Perhaps no other country needs all these services more badly than India.
Is it late to introduce 3G in India?
In a country like India, it's important to launch services at an affordable rate. It's not just the cities, but also the remote villages and small towns of India that need high-speed networks. And technologies like 3G or 4G, will only be popular once they become affordable.
Given the high base price of 3G spectrum, one wonders how affordable 3G will be. One can only hope that the Indian government is not heading for a 3G/4G faux pas.