Though the 3G policy has come at least two years late, it is a welcome development, since the telecom industry as well as the users have been waiting to be able to take the next phase of development of the mobile telecom sector.

Telecom Regulatory Authority of India (Trai) had first submitted its recommendations in 2005, but at that stage the then minister was keen to leapfrog to 4G or else totally submerge in the so called 2G spectrum. In fact, the government has been either too busy patting itself for the phenomenal growth of cellular mobile subscriber base, or attempts to bring in new players without taking note of the difficulties in creating additional spectrum for them.

We lost sight of two important facts. Firstly the regulatory and policy initiatives in the past had set the stage for rapid expansion. Secondly the priority for bringing in the new, more efficient technologies, which will usher in the wireless broadband networks, thereby improving the prospect of repeating the success story for broadband networks and connections, was also lost sight of. The issue now is to ensure the successful launch and then development of broadband wireless networks.

It is necessary to critically examine the newly announced policies from the viewpoint, whether it is adequate in all aspects for successful growth of broadband services in the country. The first lacuna one notices is the lack of clarity in regard to the quantum of spectrum available. It has been indicated that up to four operators (excluding MTNL and BSNL) will be able to get spectrum. However, in important markets such as Delhi and Mumbai, it appears that spectrum is just adequate to enable one private player to come in.

In such a situation of extreme shortage of spectrum, the bidding process is likely to produce distorted results on the price front and therefore the start and public acceptance of tariff structures becomes questionable. One could argue that the impact of a one time capital investment like cost of spectrum may not have a very large impact on the cost of service for a new operator.For an existing operator with substantial infrastructure, this cost may be considerable percentage of cost of service it offers.

The government could have done well to identify a few 1.25 MHz slots in the 450 and 800 MHz bands and clarified that in-band 3G service provisioning does not require any further approvals from the policy maker.

This would have opened channels for additional players to join the list of 3G operators. A mere statement to the effect that auction in these bands will be carried out when spectrum in these bands becomes available, does not indicate that enough effort may not have been put in the formulation of the policy?at least not the right effort.

There has been considerable comment in the press about the advantages of additional/new players to bring down tariffs further. In the present case, the announced policy has put such new players at considerable disadvantage by imposing the condition of acquiring UASL licence (that too possibly with no guarantee of 2G spectrum), as a pre-condition for eligibility for bidding. In fact, this type of policy statement could have come even in 2005 when Trai first gave its recommendations, or at least two years back when revised recommendations of Trai had been made. In the fast changing telecom sector, two years is a very long period and this delay has hurt the prospects of what telecom sector could have contributed to the national economy.

Simultaneously, the BWA (broadband wireless access) policy has been announced. This is a welcome step except that there is an attempt to discriminate between the spectrum price of 3G and BWA. Spectrum will be auctioned. With ITU (International Telecommunication Union) also identifying BWA and 3G services under the common nomenclature of IMT, this is a retrograde step.

Notwithstanding these limitations of the 3G and BWA policies, the fact that they have been announced and hopefully the process of allocation of spectrum should commence soon augers well. It is hoped that this along with the announcements on number portability marks the end of policy stagnation, which has plagued the telecom sector over the last four years.

?The writer is a former member of Trai