India 3G, Where Is It Going?

Indian telecom companies and their ad campaigns are going gung-ho about the launch of 3G in India, handset companies are announcing new 3G enabled cell phones by the day, everybody is supposedly excited about the new 3G ecosystem which they will soon evolve, reports and analysis are pouring out of the woodwork for the dawn of a new era in the Indian Telecom sector.

How has 3G panned out till now?

Ask any common man, about 3G and you will get the answer to my question.

The uncommon man might be a bit more educated but I wonder how many has experienced 3G? For that matter one wonders if they know what can they experience with 3G?

While this is not a note to criticize this much awaited and lately arrived technology in India (one of the last countries in the world to get it) but it would be prudent to make it a success with all sincerity and learning from others. We are yet to experience the 3G force and some have started talking about 4G. While it is great to plan in advance but, one has observed time and again that it is a tendency of Indian entrepreneurs and the policy makers to make spectacular announcements, (i.e. the US$10 computer?)  with zero follow ups or delivery of the promise. 

Most companies are weak in enabling processes, internally and externally to ensure the success of their endeavor. That’s why many technologies have been implemented unsatisfactorily. At times wrong technologies are chosen which result in great visions getting busted with wrong people at the right places and the resultant lack of understanding, wrong processes and business failures.

While the 3G spectrum auction has been a financial success for the government (US$ 8 Billion? not withstanding any scams), one hopes they make sure that the 3G spectrum allocation is used for the purpose for which it has been given, that is to offer the 3G experience to the subscribers and In turn empower them.

I mention this as there are feedbacks from the industry that 3G is not doing well and hence the spectrum is being used primarily for increasing the 2G subscriber base. This is in spite of the fact that many mobile services have bad network reach (to say the least) and they don’t seem to be doing anything about it. Even though the government introduced mobile portability (delayed by over a year but they finally did it) and with the results, one wonders if it has jolted some of the telecom companies from their slumber (8.5 million requests in April 2011)? Are they doing anything to improve their existing services? Can they do anything about it? This not to say that the beneficiaries of the number portability is doing a fantastic job, but the subs have given their ruling.

The strategy of telecom companies looks quite simple – it is based on the fact that there are enough subs to be acquired in the 2G space. Secondly, take advantage of the fact that Indians as a whole do not meaningfully protest against bad services, be it bad coverage, call drops or horrendous call center operations and finally, milk the market for the top end 3G users (with Rs. 650 per month/1 GB of download onwards) which are still very small in number.

The question is then, has the subscriber benefited from 3G?

As I believe there are few exciting games, some GPS apps (primarily on the Android platform & iPhones), some claiming mobile TV… but barring that what else? The reason why I ask this question is that in 2004 we had offered Mobile TV in the previous telecom company with which I was associated . We also offered interesting Short Video Clips apart downloads, successfully ….    Without a 3G network.

So what else is 3G offering? Where is a 'reason why' for the subs to get a 3G service?
Great Net Surfing? Have you experienced it? Has your colleagues experienced it? Or taking off from a popular ad campaigns by a telecom company, the subscribers are still “waiting, waiting, waiting …?” A recent court case on 3G with a sub, a leading telecom company has withdrawn their case = conceded that their 3G services are bad?

Is 3G benefiting the Telecom companies, apart from increasing their 2G sub base? Has the ARPU of telecom companies showed any upward movement? Some will say it is too early to tell. Is it? Weren’t they supposed to be ready before they participated in the auction? Surely they know that acquiring 70 million subs @Rs. 200 ARPU per sub to breakeven is not easy.

Have the VAS players taken advantage of it? Do they understand what can they do with 3G technology? 

Have the apps guys got anything exciting up their sleeves? Or are Film Trailers, Cricket Scores, Zodiac signs and Ringtones still dominating? Have they looked beyond that? What can they offer? …. That’s another story.

How are they all monetizing 3G ? Many from the telecom industries claim they have great plans and soon they will roll them out, but when? Are they like BMC (Bombay Municipal Corporation) waiting for the Minister to arrive for the fly-over ribbon cutting ceremony even though the flyover is ready since last several months? What are they waiting for?

So who is benefitting from 3G? (or in future from 4G? or LTE?)

I believe the biggest beneficiaries of 3G in India till date are Google (via their Android platform and getting a huge Indian mobile net surfing eyeballs), iPads and its clones, Chinese handset makers and too an extent Telecoms (but not from increased 3G VAS ARPU, in the purest of sense). Perhaps the only advantage till date the subscriber is supposed to be availing is the supposed easier access to Mobile Broadband. That to it is still unproven with many service providers.

But if this was the main and perhaps only ARPU enhancer for the Telecom companies then I wonder why have they set-up their own 3G Value Added Services (VAS) outfits? Do they understand that Indian customers is not satisfied with the same 2G VAS rehashed as 3G services?

It’s time Telecom entrepreneurs understood that the times are over when by just acquiring New Technologies means success. Or for that matter getting a collaboration with a known international telecom company as a partner means success. Technology unless properly understood, harnessed and applied, becomes a dud. 

Fortunately, the Indian customer is smarter than most CTOs, Presidents and many Telecom Entrepreneurs except very very few, one of whom I know in my short professional experience, who were true visionaries. But a great Vision needs good implementers, team of senior executives with entrepreneurial anatomy. 

The reality is that subs are not finding any compelling reasons to get 3G, so unless the Telcos straighten out their 4Ps, they stand to lose big time.