NEW DELHI - As India prepares to roll out third-generation (3G) mobile services
in the world's fastest-growing telecom market, there are high expectations that
it will benefit people in the vast, impoverished rural hinterland most.
"In the same way that basic mobile services allowed India to leapfrog over the
digital divide, 3G services with their video and picture features can transform
life in the infrastructure-deficient rural areas," said Devendra Jalihal, a
member of the Chennai-based Telecommunication and Computer Networking Group
(TeNeT).
The rural population in India is estimated at 7% of its 1.1 billion population.
The actual rollout, which will be carried out over a period of three
years, is expected to begin in December once the auctions to private operators
are over.
To date, 3G services have been patchy and experimental in India. The
state-owned telecommunications company Mahanagar Telephone Nigam Ltd has
launched a promotional drive in most of New Delhi, charging 1.80 rupees (3.8 US
cents) per minute for a video call within the company's network. Calls to
private internal networks, when available, will cost three rupees per minute.
A specialized group drawn from several departments of the prestigious Indian
Institute of Technology-Madras, the TeNeT has been tasked with research and
product development for the Indian telecom and networking industry as well as
driving information technology policy.
Current TeNeT missions include building 50 million broadband connections over
the next five years, helping to double the rural gross domestic product of
India, making high-quality distance education possible and driving the next
generation of wireless standards.
"At TeNeT we are naturally very excited about the rollout of 3G services
because video and pictures can help overcome language barriers. For example,
very few farmers speak or understand English, and this limits their access to
urban markets using voice alone," Jalihal told Inter Press Service in a
telephone interview from Chennai.
"The possibilities are endless - 3G will positively impact such areas as health
services, education, agriculture and governance," said Jalihal. "There will
naturally be an increase in public expectations in these areas, and this can
dramatically stimulate social change."
Jalihal believes that the introduction of 3G-enabled mobile services will more
than make up for the relatively poor penetration of the personal computer (PC)
into India's rural areas.
Mobile 3G services can make Internet services more easily accessible compared
to using a PC, which needs steady electricity supplies, maintenance, broadband
services and other infrastructure which are missing in large swathes of rural
India.
"While we are approaching a figure of 500 million mobile subscribers, PC
penetration in India remains poor compared to countries like Russia, Brazil and
China," Jalihal said.
Internet penetration in India is still 7% of its population as against 25.3% in
the 1.3 billion strong population of neighboring China, where 3G commercial
services started on October 1. Within Asia, South Korea has the highest
Internet penetration covering 77.3% of the population, followed by Japan with
74%, Singapore with 66%, Malaysia and Taiwan, with 65% each, according to
Internet World Stats, a data-providing website on world Internet usage.
On the other hand, India is currently adding 10 million new mobile subscribers
per month on average. The World Bank estimates that every extra 10 mobile
phones per 100 people in a typical developing country can boost GDP growth by
0.8 percentage points.
According to the Telecom Regulatory Authority of India (TRAI), India added more
than 30 million new mobile subscribers in the months of July and August. That
contrasts with the pre-liberalized era of the 1980s when telephones were
considered a luxury and the waiting list for new connections hovered around 20
million applicants.
Privatization of telecom and mobile technology changed all that.
Second-generation or 2G mobile services rapidly seeped down to the grassroots
level. Today it is already common to see domestic workers, cab drivers,
carpenters, plumbers, vegetable vendors and farmers using mobile phones.
With the advent of 3G, fishermen can negotiate prices for their catch before
heading for shore by sending in pictures of the type of fish they have on
board. Similarly, farmers and horticulturalists who have perishable produce can
take advantage of 3G services to bargain for the best prices before harvesting,
bypassing middlemen.
Deven Appiah, a Bangalore-based rose grower, prefers to wait till the last
minute before putting shears to his blooms to maintain freshness. "It helps if
florists in cities like New Delhi or Mumbai place major orders if they can
actually see the color and size of the flowers in real time.'' He knows this is
possible with the use of 3G facilities.
Jalihal said TRAI policies are structured in such a way as to ensure that
private mobile operators are compelled to take their services to millions of
rural consumers because that is the only way they can recover the high costs of
buying 3G spectrum at government auctions, which are due to be completed by
November. One such policy requires the conduct of auctions.
The auctions were originally scheduled to take place in December 2008, but the
government was unable to arrive at a reserve price, which has finally been set
at 34 billion rupees for an all-India license. The government expects to make
at least 237 billion rupees from license auctions.
While operators have been bickering over the high costs of licenses, Jalihal
believes that the government can use the money to ensure that the necessary
infrastructure gets built and a wider section of the population, particularly
in the rural areas, benefits.
Statistics released by TRAI show that there are presently 38 million
subscribers across India using Internet services through their mobile phones
instead of land lines. This figure is bound to rise when 3G becomes available.
TRAI expects that value-added services will drive bigger revenues for the
telecom industry in India, and that these could cross US$3.5 billion annually
by mid-2010.
All the prognoses are upbeat. The Federation of Indian Chambers of Commerce and
Industry estimates that there will be 90 million 3G mobile subscribers by 2013
and that annual sales of compatible handsets will reach 81.3 million units by
2013.
According to the International Market Assessment, mobile handset manufacturers
are planning to launch 3G phones as cheap as 2,800 rupees to tap into India's
rural markets, where three million subscribers are being added each month.
Jalihal is confident that while there are challenges, 3G operators can take
advantage of new opportunities in providing a mix of voice, data and video to
generate additional revenue that can compensate for the high license fees and
also participate in what could prove to be the single biggest step towards
socio-economic transformation in India.
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