'India could have 270 mn 3G subscribers by 2013'

NEW DELHI: India could be the largest 3G market among emerging countries as 270 million subscribers are expected to use these high-end value added mobile services in the next five years, says a research agency.

The guidelines have been already issued for 3G services and the Government hopes to roll out high-end mobile services by December.

"In terms of subscribers, India is going to be the largest market for 3G users among all emerging markets...India could have 270 million users subscribing to 3G services by 2013," research agency Strategy Analytics VP, Wireless Practice, David A Kerr said.

The research agency said 3G subscribers would constitute more that one third of the total wireless users in the next five years.

Initially, the subscribers would come from metro and 'A' category cities, and enterprises and business customers would make the largest chunk of it, it said. "India has 700 million untapped customers and it is very much possible to have 270 million 3G subscribers in next five years."

At present, the country's total mobile subscriber base is about 290 million.

"At the initial stage corporate and enterprise users as well as tech-savvy young generation would drive this market," Kerr said.

Source : Economic Times

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TRAI, DoT lock horns on 3G policy

NEW DELHI: TRAI’s recent letter to DoT, highlighting shortcomings in the government 3G policy, has kicked up differences between the telecom regulator and DoT.

TRAI, in its letter, has highlighted six shortcomings in the 3G auction guidelines that were announced recently. The most significant one that can impact exchequer revenue relates to the need for an “amended’ ’ unified access service licence (UASL), which needs to be acquired by every successful new entrant in the 3G space.

TRAI, in its letter to DoT, concludes that a reading of the 3G guidelines “implies that in case a non-licencee becomes successful bidder, he will be given a new (modified) UASL without the provision of 2G spectrum (spectrum in the 800, 900 & 1800mhz) at an entry fee equal to the entry fee of UAS licence’’ .

While announcing the 3G guidelines, telecom minister A Raja had confirmed that universal licences for new 3G entrants—costing Rs 1,651 crore— will come without 2G spectrum. Potential bidders have also complained that this is “unjustifiable and discriminatory’’ . Now, in contrast to TRAI and Raja’s conclusions, a senior DoT official told TOI that “new 3G entrants will, by virtue of their universal licence , be eligible for 4.4 MHz of spectrum as per the law of the land and can also join the 2G queue’’ .

This fresh twist is set to spark more confusion among potential bidders.

TRAI has thrown another spanner by informing DoT that it needs to receive recommendations from the regulator if any amendment of the licence agreement is proposed. “As this would require the terms and conditions of this new licence , including the annual licence fee, the authority would like to draw the attention of DoT to section 11 of the TRAI Act wherein recommendations of TRAI are necessary,’’ the regulator wrote.

DoT will find this letter tough to ignore, considering TRAI’s principled and legally valid stance on the matter. Equally, TRAI is obliged to engage in a public consultation process. All this could take months. Meanwhile, all this confusion could help new entrants make a killing. A shareholder in a pan-India 2G firm that received a letter of intent (LoI) on January 10 for 2G spectrum told TOI that 3G entrants will be better off while striking deals with new entrants before participating in auctions. The firm, which paid Rs 1,651 crore for 4.4mhz spectrum, has term sheets doing the rounds boasting of an enterprise value of Rs 6,000 crore, without even spectrum in hand.

“Even if new 3G entrants join the 2G spectrum queue, everyone knows there is no spectrum to give, so why should they pay the government Rs 1,651 crore for just a licence. They would be wiser to buy into a company like us which has assured spectrum,’’ he told TOI.

Source : Economic Times

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CDMA cos too must bid for 3G: TRAI

KOLKATA/NEW DELHI: Cracks have surfaced in the recently announced 3G spectrum policy. Telecom regulator TRAI has said the government’s decision to allot third generation (3G) spectrum to CDMA players without an auction is against the principles of equality.

This is because the policy gives CDMA operators ‘one’ slot in the 800 MHz band — the most efficient and cost-effective frequency for CDMA players to offer high-end services — with a rider that the largest operator in a circle would get it. This means Reliance Communications, with the largest subscriber base in all circles, except Delhi and Maharashtra, will be given 3G spectrum ahead of other CDMA players Tata Teleservices, BSNL, MTNL and Shyam Telecom in the 800 MHz frequency band.

DoT currently has 3G frequencies in the 800 MHz to accommodate only one CDMA player. ET has also learnt that it will take over a year for the defence forces to free additional frequencies in the 800 MHz band. This means other CDMA players will have to wait for over a year and the position can change only if there’s an auction. On the other hand, GSM players like Bharti Airtel, Vodafone Essar and Idea Cellular will have to go through a global auction to get 3G spectrum.

Earlier this month, communications minister A Raja had unveiled the 3G policy which would help telecom operators to offer high-end services such as video conferencing, faster downloads of music and movies, interactive gaming and high speed internet.

TRAI chairman Nripendra Misra in a August 8, 2008 communication to DoT secretary S Behura has said: “Since various service providers have been given licences in different service areas at different time periods, TRAI believes that keeping the subscriber base as the criterion for deciding the priority of spectrum allotment shall go against the level-playing field and the principle of equity.”

Additionally, Mr Misra also said RCOM and Tata Teleservices apart, several other players such as BSNL, MTNL and Shyam Telecom have been given the licence to offer CDMA services. “So, the government must take the auction route to allot 3G frequencies in the 800 MHz band for CDMA players as well.”

Further, to drive home the issue’s seriousness, Mr Misra has used firm words to emphasise the need for a review of the policy: “Spectrum in the 800 MHz should be auctioned among applicants with the highest bid price received for the auction of 2.1 GHz spectrum as the reserve price. The subscriber base of the CDMA network of a service provider in any service area is a result of different environments, and cannot muster the test of fairness if it was to become the basis of priority.”

Mr Misra’s communication is likely to come as a major embarrassment to the DoT and communications minister A Raja, since both have been maintaining that the government would provide equal opportunities to all players to bid for 3G frequencies.

“RCOM will have a clear and distinct advantage. Other CDMA operators may have to wait a long time,” said an executive with a private CDMA operator who did not wish to be named.

When it was pointed out that CDMA players had the options of bidding for 3G frequencies in the 450 MHz and 1900 MHz bands, the executive said: “The best band is 800 MHz. Since CDMA players already offer 2G in this frequency, the migration to 3G would be easy. The 450 MHz band is largely for rural India. As for the 1900 MHz band, there is no timeframe when this will be made available. The policy is therefore tailormade for the largest CDMA operator.”

When contacted on the issue, Mr Misra said the regulator had sent its views to the DoT on the recently unveiled policy and added, “We are only saying that allotting 3G spectrum based on the number of subscribers is not feasible. Different operators got CDMA licences at different times and therefore the subscriber base cannot be compared.”

Source : Economic Times

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