4G Services in India – What is the Problem?

This post was provoked by an article that cropped up today in my news feed – an article on the expected availability of cheap 4G devices. This, to me, signifies the proverbial chicken and egg situation in some form – what will become cheaper first – 4G services or 4G devices – to encourage greater adoption and success for 4G devices. For, make no mistakes about it, the success of 4G services will definitely depend upon its pricing, leading to a greater adoption by a critical mass of data users. 

Till date, the 4G plans of the telecom companies in India have been marked by a strange lethargy – as if they are extremely reluctant to roll out the services. Many assume this is due to the 2G fiasco and the resultant judicial ad political backlash that resulted from it –but that is only a very small part of the story.

One of the most significant hurdles in successful 4G rollout and implementation in India is a perennial issue – the availability of suitable frequency bands – an issue compounded by the way frequencies were allotted in the “2G scam”. The government – the ultimate arbiter of frequency band availability – has clammed up, and the recent Supreme Court pronouncements that frequency bands are a national property will definitely queer the pitch further.

The result is that the bands available for implementing 4G services in India – 2300 Mhz band – are mostly useless for fast transfers of data and syncing with the available LTE devices. For example, the iPhone 5 and iPad 3 do not work on the LTE networks in India.

Then there is the significant issue of the available 4G devices, which are quite expensive by Indian standards. For example, Airtel 4G dongles cost around Rs 5,000 – more than 3 times the average price of 3G dongles which is around Rs 1,500 for most carriers. Compatible handsets are also very expensive – and very few are available anyway. This issue is further compounded by the expensive data plans and lack of appropriate apps and content. A number of users have also been put off by the service standards that eh companies have offered for their 2G and 3G networks – users are expecting the same with 4G networks – and are, therefore, not very keen.

At present, only a few selected metro cities in India are enjoying 4G services – Airtel being the only service provide to roll out the services. Kolkata, Bangalore and Pune are the three fortunate cities, with Mumbai, Delhi and Chandigarh waiting next in line – although no launch dates have been announced so far.

The future hold some promise, though – and the prospective users are fervently hoping for it. The biggest hopes are pinned on Reliance, which is the only service provider that has a pa India license to roll out 4G services. It is expected that the large scale of the roll out and the traditional Reliance mindset of aggressive pricing will bring cheaper devices and data plans to India consumers. Smaller players like Tikona Digital Networks are also gearing up to launch 4G services – albeit on a smaller scale.