MOST Appropriate

Thanks to the mobile telephony explosion, from the current 140

mn subscribers, there will be over 250 mn subscribers by the end of 2008. This

means that over and above 100,000 towers that dot the country today, at least

300,000 new towers will have to be erected. This is going to cost about Rs

25,000 crore additionally, and most of the money will go into tower shelter,

civil work, electricals, power supply, and optical cables.

Should Indian operators, therefore, share telecom

infrastructure? The industry seems to be in a bind on this, and that the idea is

noble, nobody denies. It saves national resources, reduces duplication, and does

not deface town and city skylines. And on top of all this, there is likely to be

an improvement in quality of service, where operators have not been scoring too

well in the last few years. With operators sharing towers and other passive

telecom infrastructure, they will find it easier to reach the remotest part of a

city or village, and there will be lesser call drops. But most importantly, the

undisputed fact is that it saves a lot of money for the operators, and it is

happening in many other countries.

The operators are not sounding too excited about this sharing

business. They have security concerns in shared environment, and not too sure

how well will the sites be managed. But most importantly, they are not too sure

if these shared telecom infrastructure companies will be able to keep pace with

their network rollout plans. Some of the operators, for instance, will set up

about 18 to 20 thousand towers in the next 12 months.

There are a few telecom infrastructure companies that have come

up in India. It is important that they present a sound business model to the

operators, and remove all their doubts about this business model, and remove

apprehension about their capabilities. That is when operators will be confident

enough to try it out. One must not forget that several operators have already

outsourced some key components such as network deployment and management,

security, IT infrastructure, and customer support. So, they are open to such

ideas. Sharing passive infrastructure should not be a big issue.

While it might take some time for these players to be able to

convince operators, there are already other factors at work. Operators might be

forced to consider infrastructure sharing model due to other pressures and not

just business considerations. Recently, the union Communication and IT Minister,

Dayanidhi Maran, announced MOST (Mobile Operators Shared Towers), a plan to set

up shared passive infrastructure such as towers for mobile services across the

country. The government believes that such sharing will help in lowering op-ex

and cap-ex, and therefore enable operators to reduce tariffs further.

Under this program, which has been described as a joint

initiative of the government and the industry, the target is to set up 1,800

shared sites for in Delhi alone, for GSM and CDMA operators, within 2007.

And if operators thought they would not find it very difficult

to resist this plan, think again. Infrastructure sharing as a concept has the

backing of Jaipal Reddy, another government heavyweight who heads the ministry

for Urban Development. This ministry can influence bodies like municipal

authorities in such a way that erecting towers within the city becomes even more

tough and problematic. Project MOST has started with urban areas, but the

government wants to push telecom infrastructure sharing in rural areas too.

Life is not just about increasing teledensity but also about

enhancing aesthetics of the environment by minimizing the intrusion of towers.

It might be worth for the operators to work along-with the shared infrastructure

companies rather than shun them.

ibrahima@cybermedia.co.in