3G In India

he government is expected to start allotting third generation (3G) spectrum from today to successful bidders to meet the 1 September deadline promised to the industry. However, actual rollout of the services, which will give subscribers access to services such as video calling, interactive gaming and high-speed internet using phones, is unlikely before December.

Although there is no official confirmation so far, reports say the department of telecommunications (DoT) will also start the process of amending the unified access service licence (UASL) licence agreements from Wednesday today. Once that is done the frequency bands can be used by operators.

The development comes as a happy surprise to operators, as nobody really expected the government to meet its 1 September deadline.

The defence forces had already released two slots of 3G spectrum before the auction, while a third slot is to be released soon. The forces have got a waiver of almost Rs10,000 crore for spectrum charges, which was a key demand for them to vacate of 3G spectrum.

The 3G auction was held in April-May this year, earning the government windfall revenues of over Rs67,000 crore. A total of Rs1.06 lakh crore was earned from both the 3G and broadband wireless access or WiFi spectrum auction.

None of the operators was able to bag pan-India 3G spectrum. The country’s top two mobile firms, Bharti Airtel and Reliance Communications (RCom, each had won 3G airwaves in 13 of the 22 telecom zones on offer, while major operators Aircel, Vodafone Essar, Idea Cellular and Tata Telecom won a total of 13, nine, 11 and nine circles respectively.

State-run Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd were given a head-start, being allotted pan-India 3G spectrum ahead of the auction process. While both the telecom PSUs have had to match the winning bid in the auction, they have only been able to garner a minuscule number of subscribers so far.

The defence ministry and DoT are committed to some deadlines on the release of spectrum for 25 MHz of 3G spectrum. This is based, among other things, on the progress of the alternative optical fibre cable communications network being built by BSNL, which the defence forces will use after they release the spectrum.

The armed forces had vacated 10 MHz in May and were expected to give out more spectrum to DoT in July and August, when orders for equipment would be given out and again when work on the cable begins.

Most companies that have won the spectrum have been gathering content and equipment for the launch of services before the end of December. However, security issues with Chinese equipment vendors have delayed network deployment for a few.

A Tata Teleservices spokesman said on Tuesday, ”We look forward to positive developments on the spectrum allocation issue tomorrow. We have already awarded our 3G network rollout contract to Nokia Siemens Networks and look forward to speedy rollout of 3G services by the end of the year.”

Aircel is developing a series of applications that will drive up data consumption. The company expects to roll out services by January, chief operating officer Gurdeep Singh said. ”Our process of request for proposals (for hardware) is under way. We hope to close it in two or three weeks.”

Reliance Communications entered into a tie-up with Universal Music as a ”a prelude to Rcom’s 3G launch since music offers the potential to provide the best consumer experience on 3G network,” the company had said. It expects to launch before the year-end.

At present, all operators are in discussions to not only share passive infrastructure like towers, but also active infrastructure like radio transmission equipment to reduce costs of a 3G rollout. The discussions include intra-circle roaming facilities so that operators can offer 3G services across India, rather than just in the cities where they have spectrum.

Consumption of data and other high-end services is expected to partially reverse the fall in average revenue per subscriber that the Indian telecom industry has been facing for the past few years. In this year alone, CRISIL Research predicts that average revenue will drop 10-12 per cent. For most operators the monthly revenue per subscriber is already below Rs200.

Bookmark It

Hide Sites