India’s long-awaited 3G spectrum auction isn’t likely to boost mobile broadband’s growth rate any time soon, as the market isn’t ready and the winning bidders intend to use their spectrum for extra voice capacity.
Rajat Mukarji, chief corporate affairs officer for Idea Cellular, told telecomasia.net that Indian operators have the lowest amount of allocated 2G spectrum of anyone in the world – less than 8 MHz per operator – and are hungry for more regardless of its mobile data capabilities.
“Operators in India are starved for spectrum,” Mukarji said on the sidelines of the Mobile Asia Congress on Wednesday. “They see the upcoming auction as a 2100 MHz auction, not a 3G auction.”
After numerous delays, the government plans to auction four spots of 2 x 5 MHz blocks of 2100 MHz spectrum across 18 of its 22 service circles on January 14, 2010. The other four will only offer three spots, if at all, as the Indian military still controls the 2100 MHz band in those areas.
But the winning bidders are all planning to use their 2100 MHz spectrum initially as a voice overlay network for additional outdoor capacity, Mukarji said.
He added that even if cellcos wanted to offer 3G services right away, uptake wouldn’t be enough to justify the cost.
“3G handsets aren’t yet at the right price point, and PC penetration in India is so low that we would barely make a dent in the dongle market,” he said, pointing to the experience of EV-DO operators in the country who have launched dongle devices without success.