Delays and Problems for India's New CDMA Network

securitas writes "The NY Times and Bloomberg are reporting that Qualcomm is touting an expected 6 million Indian subscribers using CDMA by year end. But the facts seem to fly in the face of that with Reliance experiencing technical problems and delays with the launch of India's first CDMA network, covered on Slashdot late last year. Part of the problem is that the GSM operators won't allow Reliance's traffic on their networks, not to mention a court challenge and no approval by regulators. Is this just a hopeful diversion from the loss of the Iraq contract, where MCI chose GSM? How does a country where the per capita annual income is $390-$420 (depending on whose number you use) expect people other than the elite to afford mobile phone service, even if the handsets and service charges are heavily subsidized? Forbes discussed the problem of affordable mobile phone service in Africa where incomes are similar. Is this another wireless/fibre optic bubble akin to the one we saw a few years ago?"

Comments

Poor premise about mobile phone

[fruey]

How does a country where the per capita annual income is $390-$420 (depending on whose number you use) expect people other than the elite to afford mobile phone service, even if the handsets and service charges are heavily subsidized?

Well the US happens to be the exception in the mobile phone market. You have to PAY to accept calls that people are making to you. Ridiculous. The European market would never accept that, the only time they pay to be called is when they're roaming.

Now, in Tunisia a group did a study for mobile phones, used the same logic, and now the country is lumbering with way below needed capacity of GSM service, and over 6 months waiting lists for activation, last time I checked. Mobile phones become a real status symbol in the developing world, and also allow someone (with prepaid schemes, especially) to be contacted from outside their country by relatives in the diaspora. This is why mobiles are popular. The market is much more open if you have the caller pick up the tab for calling the phone.

You guys in the US should revolt. It is disgusting that both caller and receiver should have to pay for a conversation.

Not everyone in India is poor

[Anonymous Coward]

It's a country with a population of over one billion people. If just one percent are well to do then there are more people in India that can afford a mobile phone than countries like UK, France and Germany, at five percent then there are more than the whole of the EU or the USA.

Then there is the fact that there are millions of early GSM phones floating around Europe that are virtually worthless here. Who wants to but say a Nokia 5110 today? Clean them up slap new covers on, a new battery and ship them out to places like India.

Finally you forget that laying masses of copper wires to every house is a very expensive operation. With a lack of existing infrastructure it may well be cheaper to stick up mobile masts than putting down a copper pair to every house in down town Delhi, or Bombay.

Re:GSM = cheap?

[Xenna]

It's not unusual for Americans to have a flawed view of what happens in Europe (the reverse is also true). GSM is not a government mandated standard. It was developed by a consortium of commercial companies.

As to subsidies, the Dutch KPN company had to pay the state hundreds of millions of dollars for a G3 license. In Germany they paid billions for the same license. Strange way to subsidize a company, don't you think?

As a result many telecom companies are currently in trouble because G3 services (and customers) have so far failed to materialize. The reason is probably that GSM and GPRS (aka G2.5) are 'good enough' for the moment.

I don't think GSM would have been as competitive if it had been pampered.

X.

Re:GSM = cheap?

[DrXym]

Not just competitive but a mature and proven technology with broad industry support for the standard and numerous heterogenous solutions for customers and networks. Not to mention roaming and SMS.

That CDMA isn't used boils down to common sense. GSM is used everywhere with few exceptions (even the US has GSM) so that is the baseline. It would be just stupid to choose some other standard and miss out on those lucrative roaming charges not to mention pissing off your customers at the same time.

Re:GSM = cheap?

[Aceticon]

The situation in Europe was that the landline phone companies were usually a state-owned, legal monopoly.

When mobile phones came that cosy, outdated, calcified environment was shattered by new entrants:

• The mobile phone technology offered services that the landline technology couldn't offer (access anywhere, roaming, SMS)
• The slight advantage that the old telephone company had in terms of already having an already in the ground voice network was not enough to provide a barrier to entry for new companies in the mobile telephony area
• The new mobile phone companies started competing amongst temselfs and against the old telephone company. They came up with new ideas (pre-payed telephone cards, ...) and offered more services on mobiles (voicemail, ...) than had ever been available for landline telephones (let's just say that the old monopoly companies never felt the need to invest in services for they're customers)

The outcome of all this is that in Europe today still, landline telephony is crap (pay-per-minute charges, basic service) while mobile telephone is incredibly successful.

Still, since mobile telephony prices are constantly droping (thus becoming more competitive against landline), the old public telephone companies have mostly been privatised and the lanline telephony market has been liberalized, things are (slowly) improving for landline also.