Should the Indian telecom sector skip 3G, being years behind anyway, and go directly for 4G technologies? It's a tempting call but there are hurdles too..
Bijoy Ghosh To take it one at a time ....or not. Thomas K Thomas Back in the mid-1990s, when mobile services were launched in India - more than 10 years after the first generation (1G) cellular network was rolled out by NTT in Japan - cellular operators here had leapfrogged technology. Indian mobile service providers had straightaway launched a network that was based on second generation (2G) technology i.e. GSM standard; altogether skipping first generation technologies such as Total Access Communication Systems, Advanced Mobile Phone System and C-Nets deployed then by various operators in Japan, the US and Europe. Fifteen years hence, in 2010, Indian cellular operators are facing the same question yet again. Should they leapfrog from the existing 2G network to fourth generation (4G) technology and give third generation (3G) a skip? There are various 4G technologies that are being developed and adopted globally. But the most widely talked about is called the Long-Term Evolution (LTE) as some operators in Europe and the US have already started commercial deployment on this platform. LTE allows more data to be transferred over the same bandwidth used by 3G technology and at higher speeds. Compared with the 3 Mbps speed offered by third-generation services, LTE can offer speeds of up to 10 Mbps. As a result, service providers should be able to get more data transfer out of their network and possibly lower the cost to run their networks. LTE allows operators to introduce exciting services such as HD (high-definition) video blogging, HD video on demand, media mobility, online gaming. It brings a significantly improved business proposition with 2.5 times higher capacity, lower cost per bit and media mobility. Add to this the fact that India is already nine years behind other countries when it comes to introducing 3G technology. While operators such as Vodafone, NTT DoCoMo and AT&T have been offering 3G services in Europe, Japan and the US, in India the operators are still on plain old GSM network. The delay has been primarily due to the fact that the Indian Government has already taken four years to discuss and debate various aspects of auctioning 3G spectrum and still there is no finality. 3G bus missed? All this makes analysts believe that India may have missed the 3G bus and therefore should move to 4G in order to catch up with the rest of the telecom world. "Indian operators could look at moving straight to fourth-generation technologies, considering the timing and the current revenue potential. Why should Indian operators invest in a technology when they are unsure of the timing and the revenue potential? The current data needs can be taken care through existing 2G and EDGE technologies and therefore depending on the timing and the business model, Indian operators could move to 4G directly," says Marc Chaya, Global Telecommunications Markets Leader, Ernst & Young. The Telecom Regulatory Authority of India has also shown interest in putting together the policy framework for introducing 4G services. "A number of countries including Sweden, Norway, the US, Korea and Japan are moving towards 4G services and therefore India should also be prepared for introducing the technology at the earliest," says the regulator, which has floated a pre-consultation paper seeking the views of the industry. The TRAI move is being backed by mobile operators including Tata Teleservices and Reliance Communications. "About 23 operators will be launching 4G globally this year. 3G was launched in 2001 and we are already nine years behind. It should not happen that we are left behind in adopting 4G technology," says Anil Sardana, Managing Director, Tata Teleservices. Japan's NTT DoCoMo, which has a stake in Tata Teleservices, is conducting trials on LTE in Tokyo and therefore ideally positioned to back the Indian company if it decides to deploy 4G technology. Even new mobile players such as Telenor, which are rolling out their 2G network, see value in skipping 3G, albeit for a different reason. These players are investing heavily in setting up their new network and may not be in a position to immediately spend more money to buy 3G spectrum in an auction. "Only two-three operators will get 3G spectrum so the others can move to 4G. Even if the Government allocates 3G spectrum by September 2010, operators will not be in a position to launch the services before mid- 2011. By that time LTE will be commercially available for operators to deploy. Since even 3G players will ultimately move to LTE, we are looking at moving straight to 4G technology in a year's time," says a Delhi-based operator that recently launched its GSM services. Hurdles in the way However, leapfrogging to 4G may not be all that easy as there are a number of stumbling blocks. For one, there is the eternal problem of finding adequate spectrum. Existing versions of 4G technologies such as LTE need more bandwidth to support the high-speed data services. "LTE will require at least 2x 20 MHz per operator to meet the need for high bandwidth services. In India it will be very difficult to find spectrum, that too such big chunks. Hence, the issue is more of spectrum consultation than of a technology debate," says a technology consultant backing 3G technology. There is still no clarity on the spectrum band that is best suited for 4G as the US and Europe are using different frequency bands. There is no synergy between the frequency bands being used elsewhere and India because these bands have already been given to other local users. Synergy in frequency band is important to keep the cost of the devices and the network low. If 4G services are offered in different bands across the globe then multiple-band handsets will come at a premium. In comparison, 3G air waves have been synergised globally in the 2.1 Ghz band which enables vendors to supply handsets at less than $100. Even if the policy makers push for opening up of new bands such as 700 MHz, this might turn out to be a lengthy process, similar to what happened in the case of 3G. "It has taken the Government more than three years to figure out spectrum for 3G services in 2.1 Ghz. So what is the guarantee that 4G will not meet the same fate? It's okay to talk about leapfrogging to 4G but it may not be practical," says an existing mobile player. The other major issue is that 4G standards are still being evolved globally. The International telecommunication Union, the global body which stipulates standards for communication technologies, is yet to release the specifications for true 4G technology called LTE Advanced. Operators such as AT&T are still investing in upgrading their 3G networks and have scheduled commercial launch of LTE only in 2011. "Operators in India will have to make a choice on whether to leapfrog or not, taking into consideration their business model and costs involved for consumers. 3G technology has been around for nine years and has a mature ecosystem to enable cheaper devices and network. 4G, on the other hand, is something that will definitely happen in the future, but not today," says a market analyst. Just like in the case of 1G mobile services, the first 3G network was also deployed by Japan's NTT. Will the Indian operators repeat history and leapfrog a technology first rolled out by the Japanese? This time the stakes are higher. http://www.thehindubusinessline.com/ew/2010/02/22/stories/2010022250040100.h tm Thanks Rahul Gambhir To unsubscribe send a message to [email protected] with the subject unsubscribe. To change your subscription to digest mode or make any other changes, please visit the list home page at http://accessindia.org.in/mailman/listinfo/accessindia_accessindia.org.in
