With the date for the 3G bids set, it’s time to get some clarity on the revenue aspect. Apart from spending big money to bid for the 3G spectrum, Indian telcos will have to shell out more if they secure the spectrum.

DoT has made it clear that a certain percentage will be charged to operators using 3G airwaves. They have also added that a current player in the market will have share 1% percent more as compared to 3% for the newest entrants.

However, this move has not been conceived well by most of the existing telcos. A two percent discount for old telcos comes because they already share around 2-6% of their revenues for offering 2G services and with an extra percent means now they’ll have to share anything in between 3-7%. Companies want an incremental share of revenues for using 3G services because 3G would be used by a niche crowd and a direct percent sharing means more money to the government even if the operator hasn’t used much of the 3G airwaves.

Source: ET

There has been a lot of things happening within the telecom department regarding the 3G technology. A few weeks back a rumor revealed that the Department of Telecommunication (DoT) has pushed the 3G auction by two weeks to January 15. Then some days later, we heard about the telecom ministry playing hardball by keeping the auction as per previous schedule.

Now in a recent twist, Telecom secretary Siddhartha Behura announced in a press conference that they would be conducting the 3G auction sometime in the second week of January and would be allocating spectrum by the end of month. He also said that come what may, there would be no delay in the plan to complete the auction by mid-January.

Let us hope the government sticks to their word this time because more delay could mean delay in the cash reserves for the government.

With the global economic recession and firms going bust, a huge investment at this point of time doesn’t seem quite appealing. This was the basic reason for authorities to delay the 3G Bidding process to early next year. Telecom Biggie, Vodafone also expressed concerns over having the bid this year, with the economic meltdown taking a hit on its profits.

However, contrary to this news, the Telecom Ministry announced that the bidding process would be held this year itself. December has been earmarked as the month, which will witness the act resulting in a collection of up to $8 Billion for the Government.

The ongoing liquidity crunch may not have impacted the telecom sector, but seems to have definitely affected the mindset of all telecom operators. The Department of Telecom (DOT) which had earlier planned the 3G auction by December 31 has now postponed it by two weeks to January 15 after the operators and bankers sought extension.

The major reason which comes out from the whole situation can be that our telecom operators have decided to play safe during this crunch period. Telecom operators will be able to source adequate funds in January as the institutions would be having funds available for the entire year.

Moreover, the GSM and CDMA operators differentiation of 2G and 3G revenue was also being seen as a delaying factor. DoT has decided to clarify any confusion over 3G auction by preparing the detailed schedule.

The Indian Telecom authorities have given foreign telecom companies to auction for 3G spectrum. This means that the companies do not need an Indian partner to get a piece of the attractive 3G cake in India, which was the case sometime back. 

This would heat up the auctioning process and make it more competitive, but the step has some conditions too. In the end, when all the spectrum allocation would be dealt with, the foreign telcos would have to partner with Indian companies to start off their services here. Also, in order to get a license for the allocation, these companies would have to shell out an additional amount of Rs.1650 crore over and above their bid amount.

The Indian market is being considered as one of the Hotspots for Telecom companies and enjoying every bit of it are the Telecom Authorities and also (in the long run) the Consumers.

Being owned by the government has its own advantages. MTNL and BSNL have been already allotted the 3G spectrum and if all the trial tests prove successful, MTNL will be launching its commercial services by December. The current trial network is in and around the Delhi’s Connaught Place area. Mumbaikars will be getting their hands on the 3G pie by early next year.

DoT recently allocated one block of spectrum each to MTNL in Delhi and Mumbai and to BSNL in other service areas. This has been done ahead of the forthcoming auction of 3G spectrum for each telecom service area. DoT has already initiated the process for selection of the specialised agency for conduct of the e-auction. MTNL and BSNL will pay a price for the spectrum allocated to them equal to the highest bid in the respective service area.

3G services are still to go commercial and we are getting predictions about the subscriber base of this next generation wireless service. Research agency Strategy Analytics has predicted that India could be the largest 3G market among emerging countries with 270 million subscribers within the next 5 years.

They even said that 3G subscribers would constitute more than one third of the total wireless users in India. The subscribers would initially come from metro and ‘A’ category cities, and enterprises and business customers would make the largest chunk of it followed by tech-savvy young generation who would drive this market.

PTI

Telecom PSU, BSNL has set its target of starting 3G mobile services by year end and be the first telecom operator in India to launch this facility. BSNL has decided to take a lead over private telecom operators and has placed purchase orders for necessary equipments required to initiate 3G services in the northern, eastern and western circles.

CIT Minister A Raja had given the lead to telecom PSUs BSNL and MTNL for allocating 3G spectrum ahead of others with a condition that both will pay the price equivalent to the highest bid. This was done keeping in mind the cumbersome process to procure equipments by the PSUs in comparison to that by the private players.

This move would definitely benefit BSNL with various the first mover advantages, couple of them being opportunity for early profits and status of monopoly.

More abuse news for iPhone lovers as Vodafone released the plans which include voice as well as data. For a new postpaid user, there are three plan options - iPhone 499 (Rs. 499), iPhone 799 (Rs. 799) and iPhone 999 (Rs. 999). On the calling front, these plans will have free 199, 249 and 299 minutes (local & STD) respectively. All local calls go at 60 paise flat while STD at Re. 1. SMS charges are 1/2/5 (local/national/international). Heavy internet users will be disappointed because there is no unlimited data plan to go for. The free data usage per month for these plans is 50MB, 250MB and 600MB.

For existing Vodafone customers, you can add a data pack which has the options of Rs. 199 giving 50MB free, Rs. 499 (250MB) and Rs. 699 with 600MB.

Prepaid users need to buy a data bonus card which will cost Rs. 100 with no free usage. 5 paise per 10kb for additional data transfer.

Vodafone Plans

Source

iPhone 3G hits India on this Friday and out of the two exclusive operators, Vodafone is the first one to reveal the prices. And the prices SUCK. If you have got enough money to burn then 8GB will cost you Rs. 31,000 and Rs. 36,100 for 16GB. This price does not include any data or voice plans and the contract details are still unconfirmed.

Airtel is yet to reveal the iPhone prices and we still reckon they’ll pwn Vodafone’s gameplan.

Vodafone Page

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