The much awaited 3G services on our mobile phones became the most annoying fact after all the delays, as they just kept us hanging on. The Great Indian 3G Saga has come a full circle this year and that ray of hope still appears somewhere in all the darkness that it’s hype had created. Let us take a look at how it all went right from the beginning of Y2K9.
Before we could get some positive news, it all started with Delay # 3 which took place early January, which was due to the difference of opinion between Finance Ministry and DoT on the base price for the license. It was predicted that a little less regulation by TRAI and DoT of the telecom space could actually be beneficial. After all that timeline which got everybody excited in Y2K8 -
- November 30th: Auction design, bid document to be prepared
- December 15th: Inviting operators to bid
- December 31th: Pre-qualification of bidders
- January 15th: Auction to be completed
- January 25th: Signing of contracts with successful bidders
- January 31th: Depositing of first tranch of auction money
But what was the result? TRAI introduced administrative charges which again delayed the auctions. Despite the fact that 3G was still out of the picture, mobile operators kept adding 10 million users a month to their subscriber base. Also a definite rise in GPRS usage was on the cards over in 2009-10 as the 3G auctions continued their postponements.
Furthermore, DoT proposed an increase in the reserve price, that was about 70% increase over the earlier figure of Rs 2,020 crore. Even the base price for broadband wireless access spectrum for WiMax is proposed to be increased from Rs 1,020 crore to Rs 1,725 crore while Finance Ministry had suggested this to be increased to Rs 2,020 crore.
Later, MTNL became the first telecom operator in the country to commercially launch 3G mobile services. They invested Rs 500 crore to roll out a network across Delhi and Mumbai with an aim to get 2 lakh subscribers over the next 2 years. Initially rolled out in Orissa and then in New Delhi, MTNL 3G Jadoo seems to be only for those who bought 3G handsets with the hope of 3G getting rolled out pan India sooner or later.
Finance Ministry scaled down the estimated income from auctioning 3G spectrum and made an allocation of only Rs 23.5 crore towards rolling out an optic fibre cable network for the defence forces, despite DoT quoting a total requirement of nearly Rs 10,000 crore for the project. The desperation of people increased to get their hands on these fancy looking services then, as the auction dates deferred yet again.
A Group of Ministers (GoM) was set up to resolve the issues on 3G auction which included setting the base price for the auction and finalizing the number of slots firms could bid for. The auction was said to be conducted by an independent auctioneer, N.M. Rothschild once the issues were resolved by the GoM. Whereas on the other hand, BSNL extended their 3G services to 11 cities across the country and also announced tariff plans for these services.
Hike in the reserve auction price for pan-India 3G spectrum, as the new price is being pegged at Rs 3,540 crore by DoT also looking at earlier pricing of a minimum Rs 4,040 crores by the finance ministry. Things started looking good then, but revenues that the department would earn from the current five to about seven to eight players per circle made the deal look still hazy.
Finally, the government fixed the 3G spectrum reserve prices at Rs 4,040 Crores! The prices rose by as much as 70%, however it seemed that the DoT struggle was far from over. Telecom Minister A Raja reassured the country that by 2009, 3G would definitely morph to a reality. Which now only looks like a false alarm! MTNL would have been the biggest loser then as it was given a 3G license well in advance and may have to match highest bidding prices in Mumbai and Delhi circles. Possible attempts to generate earnings through the sale of spectra and other public assets led to a delay in the auction.
A shift in the rural penetration of mobile subscription increased after the Union Budget 2009-10. In his presentation of the budget, Finance Minister Pranab Mukherjee announced about 6 blocks of spectrum to be auctioned for 3G services in addition to three for broadband access wireless. Officials in the Department of Telecom (DoT) stated that a bulk of this allotment from USOF will be used for the second phase of the rural mobile project.
Global recession aimed at cutting down the revenues for the government, hence there was another delay in the auction. Enthusiasts were disappointed as the government according to them should have thought about the citizens first and then about their own earnings. But the hunger grew with time as they thought with the growing anxiety will flow their moolah, but now these services have become a joke as heard at most of the press conferences from various telecom pundits.
As they kept operators on the edge of their seats, India got it’s first 3G Netbook by Olive Telecommunications, parent company of Haeir Mobile and Tata Teleservices Limited. But the service that it needs to be completely functional was nowhere to be seen. We mentioned that the defence services needed more time for testing and security clearances before they vacate the spectrum i.e., 20 MHz for 3G and 25 MHz for 2G services and shift to an optical fibre network that has been developed for them by BSNL.
But later the objections made by the Department of Space, made only two slots in the 2.3 GHz band available for the BWA players in the auction. So it was obvious that even if the auction took place in January 2010, will be able to start using the spectrum only by June 2010 as the armed forces would require time to shift to the new infrastructure, alternative network being built by state-owned telcos.
Now, January 14 ain’t happening anymore as DoT and the defence ministry are yet to work out the specific frequencies or sub-bands of the airwaves and may commence from the first week of March next year, the schedule for which is yet to be announced. And there have been talks also to skip 3G and directly going for the kill, 4G! What would you say to this?
The year has almost come to an end, and we still can’t see our loved ones far away while talking to them over the phone. As handsets and 3G services sing to each other these lines -
Set me free, why don’t you babe
Get out of my life, why don’t you babe
‘Cause you don’t really love me
You just keep me hanging’ on
You don’t really need me
But you keep me hanging’ on.
