Unlimited usage plans may choke 3G spectrum

Unlimited usage plans may choke 3G spectrum

Some of the telecom operators are reportedly planning to offer unlimited bandwidth usage, as part of their 3G service, which has a high possibility of choking operators' networks

Prasoon Srivastava

Wednesday, April 28, 2010

NEW DELHI, INDIA: Some of the telecom operators are reportedly planning to offer unlimited bandwidth usage, as part of their 3G service, which has a high possibility of choking operators' networks and there by affecting revenues, says a communication solutions firm.

“We are seeing that lots of telecom operators are planning to go ahead with flat fee structure which is not going to help them. This will be like inculcating into subscriber the notion that he could 'use as much as he wants. Which means even if you benefit more, you are not going to pay for it more, ” said Anuj Kappor, country manager, Telcordia Technologies India in an interaction with CIOL.

Kapur suggested that telecom operators in India need to change their present business model and should be tuned to utilize new opportunity that 3G service will offer.

“Operator should offer data plans based on the usage. It could be charged based on the timings or the kind of data a person is using. There is technology available where operators can inspect a packet and design a business model based on that. For instance, a user can download a video file from YouTube, while the operator promoting video from some other site will get paid for that. Then in this case operator can prioritize the site and design tariff plan for the user,” explained Kapur.

Kapur cited the example of AT&T which was unable to gain proportionate revenue by offering unlimited usage of data plans for subscribers.

“AT&T had plans to increase their non-voice usage of network. Their non-voice usage went up by 5000 per cent over a period of last three years but their revenue went up by only 250 per cent,” said Kapur.

Proliferation of smartphones was identified as prime contributor in surging data traffic of AT&T network where subscriber mostly downloaded videos and other entertainment stuffs.

“The answer to this is not to just increase capex for subscribers. That will not help. These all needs bandwidth management. Key thing in 3G is not to inject these bad habits into customers. If you flatten the cost to push increased usage, there are chances that the network will be choked,” said Kapur.

3G spectrum auction is going on in India and is seeing fierce competition among operators for the spectrum. Till last evening the pan-India price crossed Rs. 8862 crore, assuring the government much more than Rs. 35000 - a revenue mark earlier set by the government to attain from the auction of spectrum.

Telecordia, which provides open, flexible, and configurable software and services for IP, wireline, mobility and cable networks to communications companies, is engaged in business with Idea Cellular, Tata Indicom, Tata Docomo, Aircel and Uninor.

Kapur did not disclose name of the companies that are planning to offer unlimited data usage plan.

MNP Interconnection Telecom Solutions India, a joint venture between Telecordia and DTC has been awarded a license by the Department of Telecommunications to implement a number portability clearinghouse in Zone- 2 which are in south and east part of India.

(If you were at the helm of a regulatory authority concerning the telecom sector in India, what measures would you have taken to avoid the choking of the networks? Please do let us know your opinion by commenting in the box below.)

©CyberMedia News

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Vikram said on 4/29/2010 11:45:37 AM:
1. The fisrt thing is to actually have a network that supports such data rates. 2. Give the choice to the customer to monitor his usage.say after each session the usage comes on screen. 3. reduce the cost of data. today it is still one of the most expensive in the world. 4. define a clear " Fair Usage Policy" . so far there is no refualtory definition of this.

to Vikram

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