Japan and India put wireless plans in motion

Countries ready themselves for LTE and 3G spectrum auctions

Japan and India may be far removed in terms of geography, but they do have one thing in common: a drive to expand the availability of mobile broadband.

First up is the ever-ambitious Japan. The country appears to be ready to press ahead with 4G mobile services or Long Term Evolution (LTE) with the government reportedly ready to offer licenses in the second half of 2009 amidst talk that local telcos will invest up to US$10 billion.

With its track record of being an early adopter, Japan joins other European and USA telcos where the telecom sectors have announced implementation of LTE 2010 and 2012, according to budde.com, an Australian-based telecom analyst firm. “The Japanese operators are expected to face lower costs for the new networks versus 3G when they paid a premium on equipment for being early adopters,” the telecom analyst’s report added.

It is understood Japan’s four leading wireless operators, comprising NTT DoCoMo, KDDI, Softbank Mobile and eMobile, have submitted applications for the 4G licenses within the May deadline set by the Ministry of Internal Affairs and Communication (MIC). NTT DoCoMo has allocated a budget of JPY300-400 billion (US$3-4 billion) over five year and is targeting a launch as early as in 2010, while Softbank Mobile is aiming for 2011-2012 start-up with a budget believed to be around JPY100 billion (US1 billion), the report continued. KDDI, the number two mobile carrier, which initially planned to migrate from CDMA EV-DO, is now planning an LTE overlay and will operate the networks in parallel, while eMobile aims to launch its 4G service in 2011.

The telecom analyst added that the telcos will use frequencies in the 2,010 MHz to 2,025 MHz range for LTE technology. It is roughly comparable with fiber-optic networks and a number of domestic carriers intend to use existing 3G infrastructure, where they have spent JPY5 trillion (US$50 billion) to keep a lid on rollout costs.

A tradition of firsts

Meanwhile, the country’s telecom sector has reached a landmark with 3G CDMA subscribers exceeding 100 million in April 2009, announced Japan’s Telecommunications Carriers Association. Domestic subscribers were introduced to 3G CDMA in October 2001 which was launched by DoCoMo. It was followed by CDMA2000 IX by KDDI in April 2002, then Softbank Mobile’s WCDMA in December 2002 and eMobile’s HSDPA in March 2007.

Continuing its tradition of pioneering new services, DoCoMo announced that it expects to introduce a new service for cash transfer to be made by its mobile subscribers without requiring them to key in banking details. After applying online, the subscriber enters the handphone of the recipient, who must be a DoCoMo subscriber, and the amount will be charged to the sender’s phone bill. The Japanese telco is targeting a launch in summer and the amount will be limited to JPY30,000 (US$320) a month.

India: 3G is top priority

India’s telecoms minister, A Raja told the Press Trust of India, after his reconfirmation following recent election, that 3G auction is top on his priority list. The minister indicated that the Department of Telecommunications (DoT) will put up proposals for decision by the cabinet. A DoT official has been quoted in a local newspaper as saying that a ‘3G auction will definitely be held this year and sooner rather than later’.

After creating much buzz with an online auction scheduled for 16 January 2009 which was delayed to end January, the matter has been postponed indefinitely. There have been warnings about the country and businesses losing out because of delays in awarding 3G licenses. (see India’s 3G auction looks scuttled as government eyes a doubling of reserve price). Two state-owned telcos, Bhara Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd (MTNL) are exempt from bidding but they are committed to pay the highest bid in the circles they operate in.

Various reasons have been ascribed for the delay, not least of which is an argument that the reserved price for licenses have been underpriced in view of earlier experience when successful domestic telcos secured multi-millions dollars from overseas telcos eyeing the fast-growing Indian market. Hence the country’s Finance Ministry reportedly wants to double the original reserved price of INR20.2 billion (US$420 million).