Clean Up The Mess, Welcome The Dreamtime

Updated: Dec 23 2002, 05:30am hrs
Have you dreamt of making a phone call from Delhi to Bangalore for 20 paise a minute You might have. Have you dreamt of getting a mobile phone for the cost of a five-course meal You will soon.

The technology is here, the prices are here and most importantly real competition is here. Indias largest conglomerates, the Tatas and Reliance, could make all this and much more possible before you celebrate the New Year. Reliance is inaugurating its telecom services, both telephone and internet, on December 28, founder Dhirubhai Ambanis birthday.

After a frenetic two years of digging up our streets, the company has installed more than 6,000 km of state-of-the-art optic fibre cables. At launch it will have an approximate 10 million households, primarily in buildings, ready to be hooked up to its network. But it also has its wireless technology ready to rapidly expand its network.

The Tatas have had many telecom companies up and running from international operator VSNL to Tata Internet Services to Tata Teleservices for land lines but they have integrated all these into a seamless network called Tata Indicom. The Tatas found themselves with so many companies offering what is essentially the same business because the government spent the last few years tangling itself in knots while its slovenly technocrats struggled to understand new technologies.

When privatisation first began, the government legislated its way into piecemeal confusion, trying to protect its telecom monopoly on the one hand and giving into influential companies and cartels on the other. Today, if you think the consumer never had it better, youre wrong. Technology and private competition can take things to another level. We are at a time when mindless wheeling-dealings, minnow-like private telecom companies and the governments ponderous giants must be shaken up dramatically to let Indias real telecom revolution unfold. The Tatas and Reliances, and to be fair, their competitors, can spark this transformation - if this current imbroglio can be sorted out.

Whats happening today is simple to understand if you ignore the forest of acronyms (CDMA, WLL, GSM) flung at you every day. Reliance and the Tatas intend to turbocharge Indias telecom revolution by using a technology that ploughs the middle path between costly (to the company) and tedious-to-install land lines and easy to install but costly (to the consumer) cellular phones.

Both companies will use phones that have a base at your home like a land line, but whose handsets can be used all over the city, like a cellular phone. Its kind of a cross between your cordless phone and a cell phone. This is what the pundits call WLL (wireless in local loop). As you read this, cellular companies are trying to knobble Reliances new phone services, scheduled for a big-bang December 28 launch. The Tatas launched their services last week.

The protests of the cellular companies are not too hard to understand. They paid licence fees worth hundreds of crores of rupees, while those who use WLL (not coincidentally, that includes the governments BSNL and MTNL) pay next to nothing. Frightened cellular companies also do not want WLL operators to be allowed to offer consumers short messaging service (SMS) or roaming - both of which are possible.

You see the problem Not surprisingly, the Supreme Court in a judgement last week refused to stay the WLL operations because it would go against the consumer. But the court also agreed that cellular companies unfairly paid not just hefty licence fees but charges to connect to other networks, again something that the Tatas and Reliance dont have to do.

There are already 4 lakh WLL subscribes with four companies in India, but this is really chicken feed for the giants, who intend to use wireless technology and integrate it with others to offer deals and rates like weve never seen.

Reliance, for instance, wants to offer the cheapest rates ever for other operators who want to use its long-distance network. The end result is that STD calls will crash to 20 paise a minute. Already BSNL and Bharti, Indias only two companies offering domestic long-distance networks (which other companies hire), are preparing to drop prices if Reliances rates are cleared by the regulatory authority. If allowed, Reliance will also entice you to switch from your cellular service to its wireless service, by offering to swap your handset for as little as Rs 1,500. As I said, this is just the start. You really aint seen nothing yet.

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