No new CDMA players for 3G
05 Jan 2009
The Department of Telecommunication, which was till now dithering on its CDMA 3G policy has decided that only existing CDMA players will be allowed spectrum for 3G. This means existing CDMA service providers will not fresh competitors for 3G.
There are four major CDMA players in the market - Reliance Communication, Tata Telecom, Shyam Telelink and state-owned BSNL and MTNL. Out of the four BSNL. MTNL have already been provided with 3G spectrum which has been soft launched in New Delhi.
Amongst the private players Tata Telecom and Reliance Communications have shown interest in the 3G spectrum.
According to reports, DoT has indicated that only the three private sector CDMA srevice providers are likely to be allowed to seek spectrum to offer CDMA-based 3G mobile services.
The move to limit the allocation to existing players is believed to have been taken as the government has only enough spectrum in the 800 Mhz band to accommodate two CDMA service providers.
DoT is believed to have asked the three to suggest a formula on how the available spectrum for 3G mobile services should be allocated between them.
As things stand, the auction spectrum for 3G has been postponed to end of January, and may be further delayed as the finance ministry wants the auction reserve price to be doubled (See: Finance ministry wants reserve prices doubled for 3G, wireles broadband)
CDMA operators are relying on the EVDO technology for their 3G services, which operate best in the 800Mhz or 1900Mhz frequency band. However, the GSM players rely on the WCDMA technology, which works best in the 2.1Ghz frequency band.
Interestingly, all the CDMA operators have some excess spectrum in the same frequency band, which is currently being used by them to provide 2G services to their subscribers. While they are willing to use some of the spectrum for 3G, DoT has disallowed them from doing so on the grounds that this would disturb the playing field with the GSM players.
Even with the new policy which is being planned for these CDMA players, the DoT will still have a tough time making decisions. Apparently, there are only 2 slots available in the 800Mhz band, while the DoT has 4 key players to accommodate. The new policy is currently pending an approval from the Ministry of Communication.
While in most other countries, spectrum is auctioned off when a mobile license is provided. This helps in efficiently deploying and using the network.
However, in India, due to severe crunch (defence and military holds the majority), DoT awarded initial spectrum while issuing a license and as when additional request came up.
