Missed Opportunities in Telecom

There doesn’t seem to any sign of the 3G auction taking place in the near future. That is a big disappointment, but not entirely unexpected. This is what I had written in early Jan:

My feeling on what will happen is that the 3G auction will probably not happen in Jan. And if its gets delayed further, we start moving into pre-election territory when the code of conduct will start coming into effect, and it could end up being delay to the end of the year after the new government takes over in May-June. I don’t think theincumbent operators will be too unhappy with this — no one is really clamouring for 3G.

It is inded very frustrating to see this happen. I had thought 3G was a year away three years away. We still seem to be in the same situation. Not only are we in India losing the opportunity to experience a new generation of services on the mobile, but Indian companies and entrepreneurs are losing the opportunity to use the domestic market to build mobile data capabilities which could then be leveraged globally. In other words, India could have become a global leader in mobile data services — mobile social networking, location-based services, data MVNOs, mobile broadband infrastructure, etc. But that becomes harder without a domestic market to first launch and test the services. And given that the domestic Internet market isn’t growing fast enough, digital-focused companies will have a tough time building out scale.

We need to understand that telecom infrastructure (wireline and wireless) can be very useful given that we have been a laggard for as long as we know. Just adding 10+ million voice connections is not good enough. The game needs to shift to data services. And there, we haven’t even gotten started yet.Hopefully, the next government will take steps in this direction, but given our past record, that is probably being way too optimistic.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.