Until 4G Comes in India, 3G Gets the Best Time to Grow Can Operators Cash in ?

While 4G is yet to go mainstream, let’s talk about 3G, more specifically existing mobile broadband in the country. 3G was first launched in India by MTNL in 2008. 3G market in India saw a change after private operators entered the market in 2010. The initial response was very poor for 3G (= mobile broadband) compared to the success story of voice market. However operators’ efforts including expansion of 3G coverage and cutting down the tariff help 3G to find a platform. With the rise of smartphones 3G adoption becomes fast.

3G Map

3G Map

In this story we discuss about three recent happenings which may prove positive for 3G growth.

TRAI Mandates Minimum Speed on 2G & 3G:

Recently Indian telecom regulator TRAI has took a major decision to mandate minimum speed on 2G and 3G services. This move will definitely push mobile service providers to keep their services at the best.

The move was required, as India saw huge growth in mobile internet segment. Many people accessed their internet experience through mobile devices and adaption of mobile internet is skyrocketed after affordable Android-run smartphones hit the market.

TRAI earlier defined wired broadband as constant speed of 512kbit/s and now they ask the mobile operators to provide minimum 56kbit/s on 2G (GSM, GPRS, EDGE & CDMA 1X) and minimum 1Mbit/s on 3G (HSPA, HSPA+ & CDMA EVDO). What’s more? TRAI asks operators to let the customers aware of this information via mentioning it on paper vouchers, advertisements and over own websites.

If you consider the latest trends in telecom industry, all operators are hiking their 2G data tariff. This move is done very prudently so that people will eventually find that just little bit more cost gives them faster 3G (upto 7.2Mbit/s in most places) compared to slow 2G. But people find that for simple apps like social networking, voice chats, IM or mail 2G is enough and hence are not moving to 3G completely. In the multi-SIM environment operators can not push customer to use 3G.

With TRAI’s dictum operators now can restrict 2G speed at anything, not less than 56kbit/s to spoil customers’ 2G internet experience which may push them to move to 3G.

Polarization of 3G Operators to Offer Seamless 3G Experience across the Country

At present there are 8 mobile operators – Aircel, Airtel, BSNL, Idea, MTNL, Reliance Communications, Tata Teleservices and Vodafone India who offer commercial 3G services. To offer seamless 3G experience these operators form partnerships with each other. With the recent deal made by RCom, Aircel and Tata Tele there become three poles of 3G partnerships.

Other two are: BSNL & MTNL; Airtel, Vodafone and Idea. The partnerships can be termed as Govt owned (BSNL and MTNL), Incumbents (Airtel-Vodafone-Idea or A-Vo-Id) and Newer (and relatively cheaper service providers) players (R-A-T or Reliance-Aircel-Tata Tele).

Hopefully R-A-T’s 3G deal will not go into controversy, as it will enable 3G roaming on pan India basis; not like A-Vo-Id group who started selling 3G services in circles where they don’t have spectrum using others’ spectrum and licenses.

TDSAT Quashes All Penalties Imposed by DoT on Bharti Airtel, Idea and Vodafone in 3G ICRA

The 3G pacts by operators will go to next level, as days go. 3G ICRA agreement was first seen between Airtel, Vodafone and Idea; and they started selling 3G connections in circles where they don’t have spectrum. DoT opposed it and slapped a huge penalty on these incumbent players. They went to TDSAT and TDSAT rules in favor of operators.

All operators including GSM lobby COAI welcome this ruling as it will be a positive for the sector. At the same time DoT plans to fight longer as DoT will an appeal against TDSAT’s order at higher authority aka Supreme Court.

Whatever the final outcome will be, I personally believe that this is the perfect time for 3G growth. So operators must seed properly to reap best!

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  • ricky8741 May 2, 2014 3:57 pm

    it halfway 2014 and still stuck at 2g which also isn’t affordable it’s a shame

  • Gundeshwar May 2, 2014 3:20 pm

    +1 bro. There needs to be an ecosystem to make 4G a success which is currently lacking. There are a very few 4G LTE devices which are not affordable at all. I hope to see some phones under 10K which would support all the 4G bands so that we can enjoy 4G services on bands other than the 2300 Mhz if service providers launch their services and it depends on mobile chip makers. Qualcomm is big player and they for sure won’t be producing cheap processors supporting all the bands of LTE modems anytime soon. Maybe, MediaTek and Broadcom can do it. Reliance Jio keeps on delaying the launch of their services maybe because they are signing a lot of deals with other operators and mobile vendors which is good as they won’t be releasing something half baked.

    • Rama May 2, 2014 5:20 pm

      *I know that Qualcomm chipsets don’t come cheap but like what I meant was if Reliance Jio could subsidize the cost of LTE Qualcomm chipsets and make it available to their hardware partners for a cheaper rate the result would be that the cost of the LTE device as such would cheaper for the end customer.

      *I agree that Qualcomm is a big player but is surely a vulnerable one.I mean take a look at the recently unveiled Qualcomm Snapdragon 808 and Qualcomm Snapdragon 810.Both the chipsets have been inspired by the popularity if mediatek’s octa core chipsets and Apple’s 64 bit cortex A7 processor.Both 64 bit computing power and octa core processors are something android does not need currently or rather cannot make use of currently but still since both Mediatek and Apple made use of octa core and 64 bit processors respectively even Qualcomm implemented them.So they are definitely keeping a note of competition.The LTE race is gonna be a big one and a one Qualcomm could not afford to lose to Mediatek.If Reliance Jio makes Qualcomm a good deal they won’t resist it.

      *Anyhow these are just my imaginations and I don’t track the telecom industry extensively so I don’t know what Reliance Jio is really upto or what they plan on doing.

  • Sudhakar May 2, 2014 2:40 pm

    2G speed is dead and 3G is in coma stage (no proper speed and is flucuating even in strong coverage area). Now 4G is going to com which is : like a vehicle that has departed for a long trip with insufficient fuel !!!. Can make you down anytime.

    I don’t care about the empty vessels who (make more noise) comment negative on this.

    • Karthik May 19, 2014 7:51 pm

      Even i also think so….like you! 2G DEAD! 3G in COMA (Suddenly wakeup) & 4G will be with insufficient Fuel

      In India, No operator is bring up their services for lifetime.
      Even Trai’s rule is going down.

      AirTel is trying better, but he sucks.
      Idea is very slow & Copying others
      Vodafone needs only money
      TATA is fit, what he has.
      Reliance is Sleeping
      Aircel is walking slowly
      ???? Don’t know what will happen?

      Atleast we request Idea & Airtel bring India’s communication services on TOP LEVEL!

  • Keshav Jha May 2, 2014 10:19 am

    Nice article.

  • suresh pal May 2, 2014 9:31 am

    Long time waiting for 4g .
    First it was said it will come in 2012 ending than told in sep 2013 and now more late.
    India is far behind in all this.
    Really no one can tell exact date for launch its always getting postponed.

  • Mohit May 2, 2014 8:01 am

    When 4G comes the telcos will decrease the 3G speed to promote 4G lte. They could reduce the 3G rates but with low speed. TRAI is the only hope but bribe is there to shut TRAI’s mouth.

    • Sudhakar May 2, 2014 2:42 pm

      No. They will further increase the 3G price to match the 4G speed. This is what happened when 3G came (2G data price is increased to maych the 3G price and is advertising in a shameless manner that 2G and 3G data rates are same !!!).

  • Suvham May 2, 2014 4:59 am

    Waiting for Reliance Jio to launch their 4G services soon.

    • Rama May 2, 2014 8:16 am

      *Its actually kind of a vicious cycle bro.Reliance Jio says they have not yet launched services because of lack of devices in the 2300 mHz band and on the other hand you have OEMS not making LTE devices citing lack of LTE infrastructure in India.Its because of this vicious cycle I believe LTE has not yet launched in India despite the fact that BWA licenses were awarded in 2010.Someone has to break this cycle for LTE to pick up in India and that someone is gonna be Reliance Jio as they will have to roll out services before May 2015(approx) to meet roll out obligation.

      *Apart from that I guess Reliance Jio will have to partner up with chipset makers like mediatek Qualcomm and ask them to produce low cost LTE chipsets and also OEMs like Samsung LG HTC Micromax Xolo etc to bring an array of 15-20 smartphones starting from 7-50k and actually create a eco-system of its own for people to choose from.

      *Apart from that a lot of marketing will also be required.Reliance Jio would need to put up ads showing real life examples where a guy having a 4G handset has a clear advantage over 3G and 2G guys.This would make the general public understand or atleast appreciate the need for 4G.Apart from this some kind of experience zones also can be set up at malls shopping centres etc.

      *Anyhow this is just a rough thinking of my own but it would be interesting to see what they come up with it when they launch services in October-december(hopefully).

    • Karthik May 19, 2014 7:53 pm

      I think, many of them are waiting, even I! for Reliance 4G
      But No body will interest much like 2G & 3G

      2G DATA is DEAD…Okay for calling.
      3G Data is in COMA….OKAY for fast browsing.
      4G ….????