Indian Mobile Subscribers Unwilling to Cruise into the World of 3G

Almost a year after the 3G action ended, the Indian mobile carriers are yet to see an influx of subscribers to welcome 3G.

The auction that fetched the government close to US$8.5 billion, saw the leading operators in the country spend over 3000 Crore INR each for the major telecom circles like Delhi and Mumbai. The seven operators that participated in the auction spent between 5000 Crore INR and 12000 Crore INR – Bharti Airtel and Vodafone being the highest spenders at the auction. It comes as no surprise that the 3G service is being offered at a heavy premium to the subscribers.

Business Standard reports that the mobile operators are seeing a lackluster demand for 3G services in the country. Speaking to a few users, the paper found that the users are more than happy with their current 2G(or 2.5G) data plans for generic browsing and email.

It has to be noted here that a majority of the phones in the country are Nokias, LGs, Samsungs or the other manufacturers. Most of the folks I know use S60 phones. Thus, a major portion of the country’s subscribers are seeing the limited web on their phones. The smartphone market is only just picking up, so it’ll be a while before we see widespread 3G usage.

The high prices of the 3G data plans are not welcomed either. I’m currently on an EDGE data plan that gives me unlimited data usage for a mere Rs. 199/month. The best 3G data plan that I can choose from my operator (Bharti Airtel) is Rs. 675 for just 1.25GB of data, with excess usage being charged at 10p/MB. A quick glance at the usage statistics on my iPhone tells me that I’ve already used up close to 1.5GB of data in the last 7 days alone.

It comes as a slight relief that the state-owned mobile carriers BSNL and MTNL offer much cheaper 3G data plans compared to the private operators. While these did not participate in the 3G auction, BSNL still has to pay the Indian government Rs. 10,187 crores for spectrum in all 20 circles it operates in. This may be the reason why the carrier has discontinued the unlimited 3G data plan that it was offering till about a month ago for as low as Rs. 999.

I presently use the BSNL iPad data plan on my iPhone 4 and have been quite content with their offering. Airtel on the other hand has offered me a trial for their 3G services, but haven’t opted for a paid data plan yet.

It’ll be interesting to see how the mobile operators recover their investments for the 3G spectrum. India has one of the lowest ARPUs (Average Revenue Per User) in the world already, so unless the carriers come out with special schemes for their loyal or long-time customers, I suspect it’ll be very difficult to see a widespread welcome for 3G in India.