BANGALORE, INDIA: The much awaited third generation or 3G mobile services will soon be a reality in one of the world’s fastest growing telecom markets. The advent of this technology has different implications for different stakeholders.

For operators and content developers, it means more bandwidth and new growth avenues through mobile value added services; for government it translates into more revenue from license auctions and bigger subscriber tax base; for consumers it allows access to fast data and video speeds, thus enhanced user experience.

In the Indian market, since mobile proliferation is much higher than PC penetration, 3G is expected to drive the convergence between mobile and internet platforms. We are already seeing a dramatic increase in online distribution and consumption of user generated content. The popularity of applications like twitter, facebook and youtube is testament to this. As greater bandwidth is made available and technology innovations in networks, platforms and end devices stimulate further demand, this trend will also be witnessed in the mobile space.

3G will provide the consumers with a rich video experience, allowing them to download streaming videos on their mobile devices. They can enjoy music videos, full length movies, or even live cricket matches on their cell phones, while on the move. The possibilities are simply endless!

As per TRAI estimate, there are already 38 million subscribers who use internet services on their mobile phones. When 3G is made available, this figure is expected to rise even further. Mobile VAS is expected to drive future revenues for the telecom industry, with revenues projected to be Rs..16520 crores by June 2010.

It is estimated that 3G mobile subscribers in India will reach 90 million and the annual 3G device sales will reach 81.3 million by 2013 (Source: FICCI+BDA). As per a report by International Market Assessment (IMA), mobile handset manufacturers are planning to launch phones in the range of Rs. 3000 – Rs.. 7000 to tap the rural market, where 3 million subscribers are added each month.

While many companies are betting big on 3G, managing the increased demand for high-speed data and video traffic along with existing voice traffic will be an enormous challenge for service providers. To conform to the growing consumer demands, they need to transform from traditional providers of access-based services into all-inclusive “experience providers” that can offer voice, video, data, and mobility services anywhere, anytime.
They need to scale-up their network capabilities tremendously and look at adopting a new approach to building mobile networks. The days of delivering voice, video, and data services as distinct offerings with each delivered over its own network, accessed using its own device, and billed as a single subscription are over.

However, while upgrading the network infrastructure, it is imperative for service providers to keep the cost low in order to optimize profits. Adding separate networks for voice, video, data to meet the expanding data/video traffic, will complicate the infrastructure and maintaining quality will become a nightmare for operators. What is needed is a single network infrastructure which can be scaled up to meet the demands of the consumers and at the same time maintain cost efficiency.

The key here is to move to an all IP based network where voice, video, data get converged into a single system, reducing the CAPEX for service providers. Being the leader in IP based infrastructure worldwide, Cisco has a distinct advantage in supporting operators in this transformation. 

While scaling the mobile infrastructure is one challenge, another challenge for operators is to collaborate effectively with the ecosystem – content developers, content creators, IT vendors to deliver an immersive video experience.  Video is complex, with many networks, formats, and standards, working together to produce high quality visual data. It is hence highly improbable for service providers to work in isolation.

The Internet is going to see millions of new users over the next decade as it evolves to provide anytime, anywhere connectivity and rich user experience. Service providers need to be well positioned if they wish to continue to ride the wave of mobile internet. Data and video traffic is accelerating at a breathtaking pace and all we need is the ideal technology platform to carry the industry forward.

By addressing the challenges associated with 3G, operators can offer a plethora of converged services to the consumer that blend data, voice and video. In this way, not only will consumer interaction with technology get revolutionized, additional revenue streams will also open up for the operators. The challenges are numerous but the opportunity is far bigger. With around 10 million subscribers being added every month, including 3 million rural subscribers, the Indian telecom sector is at the heart of the socio-economic transformation of the country!

The author is VP, SP, Cisco India & SAARC.