The future of 3G roaming in India is in jeopardy as the telecom regulator and ministry are examining the legality of agreements that private operators have made to offer nationwide 3G.
Idea, Vodafone and Airtel had some time back inked an agreement with each other under which they would be able to offer 3G services in circles where one of them does not have spectrum, but one of the other two does. A similar agreement was inked by Tata Docomo and Aircel a few months back as well.
Operators are meanwhile defending their move saying that the unified access service license is technology neutral and thus allows them to offer wireless services using any technology. They have also argue that prior to the 3G/BWA auctions the Department of Telecom (DoT) had made it clear that “3G/BWA auction is for grant of spectrum and not for grant of license to provide 3G or BWA services”.
In an internal note, though, the DoT had clarified that a UASL (unified access service licence) licensee cannot offer 3G services, declare a tariff plan or acquire customers in a circle it hasn’t been allocated 3G spectrum in.
But if these agreements are found to be illegal and are scrapped, what will be the impact on users?
Cellular Operators Association of India argues that the roaming arrangements have helped subscribers of those operators that don’t have 3G spectrum to enjoy high speed data services and also to meet the objectives of encouraging efficient spectrum utilisation and promoting broadband penetration among citizens. It also says that the government will earn additional revenue.
The above argument, however, doesn’t hold much ground as mobile number portability is in force and therefore consumers get can choose a network that offers 3G services.
Even if the customer gets 3G while roaming through such a pact, it is legal and provided for in the regulations. The problem right now is that as per DoT, operators can’t acquire customers for 3G services in circles where they do not have a 3G license.
If scrapped, the operators who offer 3G services in a particular circle as well as those who lease out spectrum will loose additional revenue. It may be noted that 3G services are not catching up as was initially expected so any source of revenue is good even if it means creating a competitor.
But if the arrangements are a win-win situation for all (operators, the government, and consumers), why is the government opposing them?
There are two sets of operators who have a problem with these agreements: The public sector player BSNL is opposing the move because it has to face increased competition as the number of 3G players in any one circle wasn’t expected to exceed four (including BSNL), but it now turns out to be up to six in certain circles. Ironically, when BSNL used to be a lone player in the 3G market it complained that lack of competition was hampering the growth of the ecosystem.
The other set of players are those who don’t have any 3G spectrum at all, and therefore are not even likely to be able to get a good roaming deal as they do not have any bait to offer. This indeed is unfair competition because if a technology neutral regime benefits one set of players, it is only fair if it benefits others too.
The government is also aggrieved as there is a feeling that auction prices could have gone higher if operators had known that there would be no way to operate 3G services in circles for which they don’t have a 3G licence.