If you thought that your 3G mobile connection was bad, here's some more disquieting news.
In two-three years' time, 3G services — which allow video calls, high-speed data exchange, and mobile TV — could get worse. Thanks to the Government's decision to allocate only 5 Megahertz (MHz) of spectrum to each operator, 3G may not live up to the hype when it comes to actual delivery of these services, warn industry watchers.
Compared with developed nations such as the US or even emerging markets such as China, where mobile operators use a 15-20 MHz spectrum, Indian operators have to make do with 5 MHz of spectrum. Essentially, this means painfully slow downloads of bandwidth-guzzling applications such as video streaming or mobile gaming.
‘Buffering' of videos or sites will be common and the time taken to download a page, longer – killing off much of the promise that 3G initially held out.
Think of it as manoeuvring a Ferrari along narrow bylanes, instead of vrooming on a six-lane highway.
At the time of launch of 3G services, operators had promised Internet TV, video-on-demand, audio-video calls, high-speed data exchange, et al. But those who jumped on the 3G bandwagon experienced frequent call drops and inconsistent Internet speeds. Connectivity, complain many users, is poor, especially while on the move.
3G had promised to deliver as much as 3 Mbps but in reality it is not offering more than 400-500 kbps on an average. Indian operators claim to offer a maximum speed of 2 Mbps ‘in ideal conditions'.
In contrast, 3G consumers in countries such as Japan and Korea got 5-6 Mbps speeds when 3G was launched in these countries. Japanese operator Softbank last year announced 3G connections with speeds of 42 Mbps.
Gradual uptake
The Indian telecom operators, however, don't appear too worried right now.
Deepak Gulati, executive director, Tata Teleservices, says 3G is the “new buzzword” in the telecom circles and is already hitting the right note. Citing research reports, he says that 3G will definitely catch the fancy of the Indian audience and shift to a higher gear by 2015.
“A new Wireless Intelligence study suggests that the number of 3G subscriber connections in India will touch 400 million i.e. a 30 per cent penetration,” Gulati says. That is a lot of headroom for growth, considering that 3G services had garnered nine million consumers in the first four months of launch.
Admitting that Indian operators function on a much smaller bandwidth compared with developed nations, Gulati, however, is quick to point out that congestion issues are not much of a concern at this point, since the uptake of 3G services in different circles is “gradual”.
According to Gulati, there will be a need for 3G innovations in the “long run” as it will enable mobile broadband access of several Mbps to smartphones and mobile modems in computers. “Over the next couple of years, the Indian telecom industry is expected to witness a surge in demand for a wide range of multimedia services that can be facilitated by high-speed data throughputs,” he adds.
Tata Teleservices has got spectrum in nine of the 22 telecom circles and its GSM division, Tata Docomo, was the first operator to roll out 3G services in the country.
Its rival, Vodafone, says it is too early to comment on the 3G situation. Other operators such as Reliance, Idea and Airtel did not respond to queries sent out by Business Line .
Not too far in the future
But while operators may play down concerns around congestion at this point, analysts caution these will have to be addressed sooner than later. Deepak Kumar, Research Director – Telecom, at market research firm IDC, says while small spectrum blocks may not cause major concern in early days, things can change if the number of subscribers rises “above a threshold.”
Kunal Bajaj, partner and director – India, at Analysys Mason, echoes similar views: “If you compare the Indian spectrum with that of the developed countries, then it definitely makes sense to say that congestion is bound to happen once the services become popular.” That situation, he predicts, will arise after mid 2013.
Already, congestion issues have started to creep in, in certain circles, Bajaj adds. And that is resonating in the 3G ads being aired. Remember the little girl singing “I'm a little teapot” rhyme in Reliance 3G ad. In the ad, the visual gets ‘pixelated' the moment she moves towards the left half of the screen tagged “Just 3G” and resumes without a glitch when she shifts to the right half of the screen onto Reliance 3G platform.
The operators' problems are further compounded due to existing congestion in the 2G network, which, in turn, is putting pressure on the operators to use 3G spectrum for voice instead of data services.
Analysys Mason, in its December 2010 report, “Assessment of Economic Impact of Wireless Broadband in India,” says that almost all GSM carriers are already facing 2G spectrum congestion in metro areas. Since 85 per cent of the operators' revenues still come from voice, they are forced to use some 3G bandwidth to accommodate nearly 800 million subscribers. Although this will provide relief from voice congestion, the fact is that this is hindering availability of wireless broadband services.
Another factor that 3G operators will have to bear in mind is the surging demand for smartphones and tablet PCs. Rising smartphone sales will increase the appetite for data downloads and video streaming.
Gartner in a recent report pegged the worldwide mobile device sales at 1.6 billion units for 2010 — a nearly 32 per cent jump from the 2009 figures. Smartphone sales alone leapt up over 72 per cent compared with 2009.
On a similar note, the industry predicts a sharp rise in demand for tablet PCs. Handset and computer makers, such as Research in Motion (Blackberry), Apple (iPad), Samsung (Galaxy tab) and Acer have already launched tablet PCs in the country. Others, such as Nokia, Motorola (Xoom), Huawei and Lenovo are expected to follow suit in the coming days.
The impact of the burgeoning smartphone users is already being felt in overseas markets in spite of their having larger chunks of spectrum.
US telecom operator AT&T, for instance, has reportedly been at the receiving end of subscribers' ire for slow downloading speeds. In the UK too, data speed claims have come under question — Ofcom, the country's independent regulator and competition authority for communications industries, has, in a recent survey, pointed to the growing chasm between the country's real data speeds and advertised ones.
Rise in Capital expenditure
According to Bajaj of Analysys Mason, once congestion on 3G networks becomes a reality, moving to long-term evolution solutions (LTE) would be the next option. This would mean an increase in capital expenditure through increased investments in base stations. “Releasing more spectrum is the ideal solution…But in its absence, increasing capex and improving network by setting up more base stations is the only viable option,” he says.
Equipment manufacturer Huawei reckons that as consumer requirements and bandwidths increase, Indian operators will resort to “innovative” ways that include spectrum farming — changing the frequency usage.
Equipment vendors and device makers are already developing solutions that will allow easier shifts from 3G to LTE, for operators.
Chipset maker Qualcomm, for example, has developed a chipset that will allow subscribers to use the same handset to move between 3G and LTE networks.
That said, operators will have to craft out strategies and walk the extra mile to comfort users.
And they would have to do so quickly. Consumers do not really care about the technical challenges the operators face. They just want a smooth transition to better-quality services on the communication highway. Are Indian operators and policy makers listening?