The Hindu Business Line : Advantage BSNL, MTNL

New Delhi, Aug 1 The biggest gainers from the 3G Policy announced on Friday are State-owned Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd.

The two PSUs have already been given 5 Mhz spectrum for offering 3G services even as the auction for private operators is yet to take place. This will give the two companies the first mover advantage as they will be able to launch their services at least 6 months ahead of the rest.

Roll-out in 3 months

Speaking to Business Line. Mr R. S. P. Sinha, Chairman and Managing Director, BSNL, said, “We will be able to launch 3G services within 3 months in Delhi. We are all set to roll out a network to support 75,000 subscribers to start with. Services in Mumbai will take some more time.”

BSNL said that it will launch its 3G services in 6 months time. “We will launch the service in phases starting with the Northern region. We are rolling out a 3G ready network with a capacity to handle about 6 million subscribers across the country,” said Mr Kuldeep Goyal, Chairman and Managing Director, BSNL.

On the other hand, private operators are not expected to launch their services before the middle of next year. “Even if the auction process is completed within 4-5 months, it will take another 6 months for any operator to roll out their network and launch services. By that time, BSNL and MTNL can get a foothold into the market,” said a private operator.

Unenviable record

But private operators are not too perturbed. They are banking on the PSUs’ track record of giving up on market leadership. “PSUs have always had the first mover advantage. Be it fixed line, CDMA or international long distance segment – Government owned telecom players have always been the first to launch. But private operators have managed to give them a good fight, which is expected once again in the case of 3G services,” said a Delhi-based telecom player.

Besides, BSNL and MTNL may not have too much of a leverage in terms of pricing the service. Though the two PSUs are getting the spectrum ahead of others, they will have to pay exactly the same amount which the private players bid during the auction process.

For instance in Delhi and Mumbai, there are only 2 slots available of which one has been given to MTNL. For the other slot, at least 8 -9 private players will be bidding which could take the bid price on the higher side and that in turn will reflect on the tariff offered to end consumers.

“I think 3G will be a premium service but it will depend on how the auction goes,” said Mr Sinha.

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