The 3G Jam

I wrote my first article on 3G in 2002 focusing on the telecom players' plan

to bid for spectrum. In the last six years, the country has gone through several

rounds of telecom reforms, but the 3G story remains the same. Operators are

waiting in the wings to grab spectrum and they are ready to launch 3G services

in addition to their existing 2G services. The cost conscious Indian operators

have learnt from the mistakes committed by European cellular companies. India

has also seen one leading handset maker withdrawing its 3G mobile phone from the

launching platform. Content companies are talking about a greater 3G growth.

Enterprise customers and individuals are ready to embrace the next generation

services as it challenges the existing speed and experience. But the government

is not in a mood to listen to the calls made by stakeholders. Primary reason:

lack of will and adequate spectrum. If the country does not have enough spectrum

to manage 3G services, why do we invite new players to enter the business?

Despite all efforts by the industry, parleys are still going on between the

government and the Telecom Regulatory Authority of India to find a way forward.

Both, the telecom ministry and TRAI must settle their issues in order to offer

the best policies to operators in India. If we need to take on China in mobile

penetration, operators and the government should settle their differences over

spectrum price, 3G rollout obligations, and entry of foreign/new players.

Do we have a peacemaker for this? Besides the telecom ministry, the offices

of the Prime Minister and Finance Minister are keen to rake in money through 3G

spectrum auction. Majority of the telecom operators are ready to support this.

But the ministries have collectively failed to convince the defence ministry to

release the much-needed spectrum that would ensure additional growth in the

industry.

The industry wants the government to continue to stimulate innovation,

competition and further telecom investments by proposing a balanced and fair

allocation of its spectrum resources. We cannot lose on negligence. We are

already going slow on our broadband targets. And 3G menaces will add to the

woes. Delay in launching the 3G initiatives could mean revenue loss to the

industry, and thereby to the government exchequer. A number of countries in the

SAARC region have gone ahead with the 3G rollouts. Despite being the largest

telecom market in the SAARC region, we should not miss out on such a big

opportunity because of government policies.

We do not require more players if the aim is to improve competition. At

present, several telecom circles have more than seven operators, while new

licensees are gearing up to launch 2G services shortly. What we need to do is to

curb cartelization and encourage companies to start services in rural areas,

which can be a boon for the entire nation. If 3G can bring in money to the

exchequer, healthy competition should be allowed. But the government should

allocate spectrum and clear the ambiguity in policies before the industry starts

looking for alternative technologies.

It's time for action. There should be no further delay in responding to the

operators' demands.

Baburajan K



baburajank@cybermedia.co.in