Sunday, July 4, 2010

India gets closer to WiMAX with Samsung

The company has already deployed Wimax infrastructure for 25 operators in 15 countries such as Japan, US and Russia.

"The company is in discussion with the operators for deploying the network infrastructure as we have global experience and are looking at leveraging that to the Indian market," Samsung Corporate Vice President (Networks Business) I D Hwang told PTI.

WiMax (Worldwide Interoperability for Microwave Access) is a wireless technology that enables faster data-transfer over a wider area than Wi-Fi.
Talking about the opportunities in India, Samsung Corporate Vice President (Networks Business - Marketing) Hung Song said, "Last year, about USD 720 million was contributed to our revenues by Wimax and it is expected to double this year without India in the picture. If India gets added, business will grow manifold."

According to analysts, after the Wimax services rollout, India would have about 5 lakh subscribers. This is expected to grow to 50 million by 2015, driven by the huge demand for data services like e-mail and social networking.

A recent study by McKinsey projected that a country's GDP improves by 0.6 per cent for every 10 per cent increase in penetration of broadband.

"Studies globally have proved that higher broadband penetration has helped the economies move up. Broadband will create new segments of industry and jobs in the country and a majority of the new subscribers would come through wireless technologies," Hwang said.

The auction of spectrum for mobile broadband is slated later this month and the government has received applications from 11 companies, including Bharti Airtel, Idea Cellular and Aircel.

The government has kept the reserve price at Rs 1,750 crore (Rs 17.5 billion) for pan-India spectrum. Two blocks of 2.3 MHz spectrum in each circle will be put up for the auction.

Asked if the fourth generation of mobile technology Wimax would be successful in India, Hwang said, "A lot would depend on the timely deployment and the pricing and marketing strategy adopted by the players."

"The prices should be at par with the current broadband offers, otherwise the acceptance might be low for Wimax," he added.

Intel and AT&T were among the major foreign companies that attended a pre-bidding conference held by the Indian government, ahead of the 3G and WiMAX auctions planned to start in January. And the Department of Telecom indicated that it would look to open up several new bands, including 700 MHz for WiMAX and broadband wireless, soon after the end of the 3G sale.

One of the constant sources of speculation, throughout the tortuous process of getting the Indian spectrum auctions on track, has been whether foreign operators would look to gain a foothold - as some, such as Vodafone, DoCoMo and Telenor already have - or even whether vendors would want to participate in joint ventures or franchise agreements. In franchises, suppliers and carriers share risk and reward and they can give a vendor a chance to push its preferred technology.

At the conference, according to Indian newspaper Business Standard, a clearer idea could be gained of which firms are likely to bid for the new licenses. The established cellcos were prominent, notably Vodafone Essar, Bharti Airtel and Reliance, as well as some of the new entrant carriers which gained 2G spectrum last year, such as Uninor, STel and Datacom. Most of the foreign telcos that have been linked with Indian auctions, such as SKT and Telstra, did not show up, however. According to Economic Times, France Telecom and Cable & Wireless have confirmed that they will not take part in the sales.

The pre-bid conference was organised by the Department of Telecom to address concerns and queries of any interested players, but did not entirely fulfil its mission - there is still no decision on the important issue of whether the auction will be conducted for all four slots in each telecoms ‘circle’ or region, or just in those slots where spectrum is already available (some has not yet been vacated by incumbents such as the Departments of Space and Defense, a critical risk factor for the progress of 3G and WiMAX in India). The DoT said it would announce its finalized policy on December 8, the day it will also invite formal applications. “If the defense forces are able to vacate the spectrum by then, we would go ahead with the auction of all the four slots. Otherwise, only available spectrum would be auctioned,” said DoT joint secretary JS Deepak.

After the 3G and WiMAX auctions, further spectrum bands are expected to come up for sale “quickly”, said the DoT, though judging by the 3G experience this could mean several years of rulemaking and debate. The next bands are likely to be 800MHz to add more spectrum for CDMA players (but, unlike in GSM/W-CDMA and WiMAX, state-owned BSNL and MTNL will not have early access); 2.1 GHz and 2.3 GHz for WiMAX, once the latter has been vacated by space agencies; and then 700 MHz for WiMAX and other broadband wireless technologies.

Once the spectrum is actually freed up, India is expected to be the world’s largest market for WiMAX vendors, and all the majors are already conducting trials with different operators there, while BSNL and MTNL have deployed some networks and are working on their franchise relationships with suppliers like Telsima/Harris Stratex and SOMA. The big WiMAX vendors - Motorola, Alvarion, Samsung and Huawei - will all be looking for rich pickings from 2010 onwards, and the technology is perhaps particularly important to Samsung and Alvarion, which have little or no presence in 3G and LTE.

There is no logical need for vendors to choose between WiMAX and LTE, just as many sold both GSM and CDMA systems. But despite the two-pronged strategy of Motorola, Huawei and others, there is an increasing tendency for suppliers to major on one 4G platform or the other, the choice partly driven by the kind of operators they aim to sell to. Samsung, while not writing off its chances in LTE, clearly sees WiMAX as its best market, and as it makes steady progress across the world, its chief wireless marketing executive said it could be a bigger revenue source for the Korean firm than CDMA had been.

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