3G auctions will mean telcos have to find ways to move people from voice to data services
You say you want a revolution. But what if all the revolutionaries claim to be martyrs even before the first shot is fired? Ask any mobile telecom operator about 3G — super-fast mobile wireless technology — and you will be met with Nordic glumness. “We are in a situation where we are losing money on every call. After the ‘per-second’ billing, revenues per call have dropped 20 percent. And you want to know about 3G!” says a senior executive at Reliance Communications.
Logic vs Irrationality
Frankly, I will be served better if they can just give me some 2G spectrum. But since they can’t, I will have to participate in the 3G auction,” says a senior executive of one of the largest firms. (Senior officials of all companies spoke to us on the condition of anonymity because of impending auctions). The consensus is that most companies that have a single technology pan-India license — Vodafone, Airtel, Idea etc. — will look at 3G as a voice-relief. As the frequencies go up, people will experience fewer call drops. “Most of the players who are planning to invest in 3G are using a predominantly voice-based business case,” says a senior manager. This is logical, yet irrational.
HOW THE GAMEPLAN COULD EVOLVE
BHARTI Airtel
SUNIL MITTAL
What’s at stake With over 25 percent market share of telecom revenues, Bharti Airtel has a huge business and a reputation to defend. It also has a fixed-line broadband market that it is rolling out quickly. It can’t leave a door open for a rival.
(This story appears in the 05 February, 2010 issue of Forbes India. To visit our Archives, click here.)