HYDERABAD, INDIA: Originally adopted as a method to increase speed of network roll out, infrastructure sharing is today central to strategies of mobile operators in India.

Though the concept was initially pioneered by infrastructure companies set-up as off shoots of mobile operators, the entry of independent infrastructure players have resulted in a balanced industry structure.

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A combination of factors such as the launch of 3G & BWA services and the need to enhance in-building network coverage will ensure that the need for passive infrastructure will be strong over the next three-five years.

Operator investments in 3G and BWA networks will provide fresh momentum
With the slowing pace of network expansion of most operators, the current demand for infrastructure sharing is primarily coming from incumbent operators, who are looking to address capacity constraints in their 2G networks and newer operators, investing to extend their mobile network coverage in existing service areas.

The recently concluded auctions for 3G and BWA spectrum in India is expected to give further fillip to demand for passive infrastructure space in India. This is primarily due to two reasons.

*The spectrum auctioned by the government for 3G and BWA is in the 2100 MHz and 2300 MHz spectrum bands respectively.

Operators will need more cell sites to serve customers in the existing coverage area compared to 2G (900 MHz and 1800 MHz).

*The BWA auction has thrown up multiple new players in the market such as Infotel, Augere, Qualcomm and Tikona, which do not have an existing cellular network. Hence, this lead to requirement for new passive infrastructure space to locate telecom equipment.

Since the 3G spectrum in all service areas has been won by the existing 2G players, investments in 3G networks will primarily have a larger impact on operator tenancies.

However since a number of new players have won the BWA spectrum, apart from having a positive impact on tenancies, the investments in BWA networks will have positive impact on site rentals and on acquisition of new sites to set up passive infrastructure.