New Year Resolution: Popularize 3G
In 2011, the telecom industry was missing the spark of the yesteryear. Though on the teledensity front we are at 76%, but there is a wide gap between urban and rural teledensity. The urban teledensity is at 167%, whereas the rural teledensity is still very low at 37%, despite the fact that on the Village Public Telephone (VPT) front, we have around 97% villages already covered.
Mobile Number Portability (MNP), which kick-started in January 2011, has not picked up as only 19 mn subscribers have ported their mobile numbers from a base of around 914 mn SIMS contributing around 2% of the total base. The reason for this low base can be attributed to low tariff, low cost of additional SIM, and no perceived difference in terms of quality of service of mobile operators; and this is a cause for concern for all operators, as this can act as a USP for 3G and 4G services.
On the Foreign Direct Investment (FDI) front, telecom has emerged as the third major sector after services and computer software. The FDI inflows have reduced vis-à-vis 2009-10. In 2011-12 (till September 2011) the FDI was around $1.9 bn compared to $2.554 bn in 2009-10 and $2.558 in 2008-09. The government needs to do a course correction on the policy front, to see how the sector can continue to increase FDI in telecom, which will help in broadbanding the country on a pan-india level. Not an easy task but it needs to be activated, so that the future services—education, health, agriculture and e-governance—can ride on this infrastructure and the aam admi can benefit from this in a big way. And, this will be the real growth of India that will shift it from a developing to a developed economy.
There are many tasks that need to be accomplished in 2012, but one task which would help the industry move forward is to popularize 3G. Mobile operators have no other option but to popularize 3G, and correct steps should be taken at all levels to make it happen. I think, the new year resolution for all mobile operators in 2012 would be how to popularize 3G. Once 3G becomes popular, it will further pave the way for 4G and other broadband technologies to flourish in the near future.
For popularizing 3G and increasing its base, the operators need to focus on a 3-pronged strategy. First, the focus should be on killer apps and here the operators need to rework on their strategy as the present one is not helping them to move forward. The operators need to rethink what will be the killer apps, which will vary from geography to geography, vertical to vertical, and as per the profile of potential subscribers. In this case, one size will not fit all and one needs to do a lot of customization to suit individual requirements.
Second, operators need to come together and focus on creating a backbone infrastructure. This infrastructure would not only help in carrying video and data to the next destination but would also multiply as we move forward. This would not be easy, as the operators need to invest in infrastructure before they can bring 3G subscribers under their fold.
Third, the operators need to convince the government and lobby for more bandwidth, as the present bandwidth for 3G will not help them to go a long way in terms of providing quality service to potential subscribers. Even the government needs to see that the pricing of spectrum is not on a higher side, so that the 3G business model works and the telecom sector helps in paying rich dividends, thus bringing back confidence to the investors and more cheer to the operators.
pravinp@cybermedia.co.in