So after years of debate, India is on the world 3G map. So what if it means that only high-end subscribers of state-owned Mahanagar Telephone Nigam Ltd (MTNL) in limited areas of Delhi have access to the service for now. Well, the Jadoo has begun.
Bharat Sanchar Nigam Ltd (BSNL) which was also provided spectrum with MTNL will officially launch services in Chennai hopefully on 14 January 2009. That also happens to be Pongal, the Tamil harvest festival. Initially subscribers are being offered video telephony and later mobile television. However, the big hope is that gaming will become a big driver for 3G in the coming months.
Auction of 3G spectrum
While MTNL and BSNL launch 3G services, private telecom operators are waiting to get into the act. That wait should end on 16 January when the for 3G spectrum starts. In 15 of the 22 telecom circles in India, private operators can bid for four blocks of spectrum of 2X5MHz. There is no spectrum available as of now in Rajasthan and the North-East. In Delhi and Gujarat private operators can bid for just two blocks of spectrum each, while there is just one block available in West Bengal. Once the 3G auctions are over, the bidding for BWA (broadband wireless access) auctions will begin.
The two-stage auction will be done over the internet. The Clock stagewill establish the bidders in each of the circles. It will consist of many rounds. This will happen simultaneously for all the 22 circles. It will stop once demand for lots in the service area is less than or equal to the available supply. This will be followed by an Assignment Stage. This will be a single round in which the winning bidders can bid for specific frequencies. However, the winning bidders need not participate in this round unless they are looking for a specific band to operate in.
All that is fine. But in the current state of the world market, how high the bids go remain to be seen. Over the next couple of years, the focus of the operators would be on subscribers in the Top 2o cities. That could mean that the battle for the Delhi spectrum could be long-drawn. After all, only two slots are available. But, expect moderate bidding in other circles. After all, in a low ARPU country, it is debatable how many subscribers will opt for 3G services.
A lot of that will become clear over the next five weeks. But, I see this as the opening for large global operators to get their foothold into India.
