Policy can wait, telecom firms gear up for 3G era

3G - an International Telecommunication Union (ITU) specification for third generation of mobile communications technology - provides larger bandwidth, higher voice capacity and faster download speeds. The technology supports high-speed data transfers of up to 2 mbps, compared with 10 kbps on 2G and 144 KBPS on 2.5G.

There is scope and need for India to get into 3G technologies as it will help in minimising the digital divide between the rural and urban sectors, and between India and developed nations, Sanjay Kapoor, President (Mobile Services), Bharti Airtel said.

"For the telecom companies which currently offer 2G services in the country, the additional expenses required for migration to these services would be incremental," he said, adding this will help in faster rollout of the services in the country.

Bharti Airtel is betting big on 3G and has even completed testing the services across various infrastructure providers.

Reliance Communications (RCom) is another operator that is all set to board the 3G bandwagon. The company is ready with the 3G network and infrastructure and is all set to launch the services within 6 months of spectrum allocation.

According to S P Shukla, President (personal business), RCom, "Telecom, like every other sector, is evolving and 3G is the next phase in this cycle. We are ready to provide 3G services, and this will be done within 6 months of spectrum allocation. Our network is 3G capable and a range of 3G-enabled handsets are available across all our outlets."

Apart from Bharti Airtel and Reliance Communications, companies such as Vodafone-Essar and Idea and new licencees including Datacom Solutions and Unitech are planning to take the plunge.

Infrastructure players such as Alcatel-Lucent and handset-makers including Samsung and LG are gearing up for 3G services. ŗG is definitely happening in the country and there is a lot of buzz around it," Rajiv Khanna, CEO (India operations), Meridian Mobile, said.

Even though no company has firmed up 3G plans - a lack of "definite policy and uncertainty over 3G spectrum allocation" were issues worrying the sector - 3G aspirants were expected to roll out services starting with the four metros and major cities.

Handset-maker Nokia is also another telecom company that is betting on 3G and is ready with 3G handsets. Devinder Kishore, Director-Marketing, Nokia India, said, "We have always invested ahead of the curve. While 3G is not a reality in India now, we believe our investment will hold us in good stead in the long run and help offer 3G as soon as it goes live".

Global research and analyst firm Gartner expects a 3G policy to be in place by the fourth quarter of this financial year and rollout to begin by the first quarter of next year. The rollout will help in arresting the falling average revenues per user (ARPUs) as 3G operations would be driven by diverse content, including e-mail, video and mobile TV, said Neha Gupta, Senior Research Analyst, Gartner.

However, the high prices of 3G handsets - which are 3-4 times more expensive than 2G handsets due to the lack of mass availability - are a concern.

Alleviating the fears, Rajkumar Ragupathy, Product Concept Engineering Manager, Vodafone Group said, "The prices of 3G handsets will decline on mass adoption and by 2009, they will be similar to those of 2G handsets in the country".

3G services are expected to become common by the end of next year, replacing 2G services to a large extent.