India's 3G Players Face Share Issue
In addition to the joint use of passive infrastructure (cell towers), the Telecom Regulatory Authority of India (TRAI) already allows India's operators to share active assets, including radio access and backhaul infrastructure.
Now, it's hoped, this can be extended to the sharing of spectrum. The TRAI has recommended that license holders should be able to share their spectrum, but this has not yet been ratified by Department of Telecommunications .
"There has been a lot of pressure on the government to allow spectrum sharing, and it should happen soon," says a highly placed government official on condition of anonymity.
Informed opinion suggests the government delayed its decision on spectrum sharing until the 3G auction was over, so that the process would generate as much income as possible: If the DoT had allowed spectrum sharing before the 3G auction took place, the carriers may not have driven the spectrum prices so high.
Analysts also believe that the government should allow spectrum sharing as it fits neatly with its efforts to give all operators equal opportunity to compete. "We feel that, this time around, the government is likely to allow this since they are trying to [provide a] level playing field to all [service providers]. The government also realizes it cannot give the same amount of spectrum [to each operator], and spectrum sharing is better than nothing," says Shiv Putcha, a principal analyst at Ovum Ltd.
Allowing spectrum sharing would enable operators to reach into additional markets -- a key consideration for all of India's mobile operators, as none of them have pan-India 3G spectrum. Aircel Ltd. , Bharti Airtel Ltd. (Mumbai: BHARTIARTL), and Reliance Communications Ltd. hold the most licenses, each having landed spectrum in 13 of India's 22 circles (service areas).
On the network side, the deployment of 3G equipment should also encourage greater active infrastructure sharing among the carriers. "3G is based on IP technology and is inherently more shareable than 2G, so there will be an increase in active infrastructure post 3G," predicts Umang Das, president of cell tower operator Quippo Telecom Infrastructure Ltd. . "In most of the markets, active infrastructure picked up only after 3G came into the picture," adds Das, who expects to see most of the active asset sharing activity in India's rural markets.
Another tower company, GTL Infrastructure Ltd. , agrees that 3G buildouts will encourage active network sharing as the license-holders look for ways to boost their return on investment.
GTL has already formed a new company, Global Rural Netgo, primarily to facilitate active infrastructure sharing, which can result in the "optimum utilization of radio frequency. We have approached many operators, but they are more interested when 3G comes along,” says GTL director Charudatta Naik.
Sanjay Nayak, CEO at equipment vendor Tejas Networks India Ltd. , also expects increasing activity. "The operators don't have much option but to focus more on active infrastructure [sharing]. They have to focus on data... the focus will shift from wireless coverage to backhaul capacity," believes Nayak.
While 3G will lead to increased asset-sharing in some areas, there are some aspects, like 3G billing, that the operators are not likely to share. "The operators are not likely to share such areas like billing infrastructure in which they have to share the contact details of the subscribers," says Ovum's Putcha.
— Gagandeep Kaur, India Editor, Light Reading