Reaching out

New Delhi, Oct. 23: The government plans to make it mandatory for prospective third-generation (3G) mobile service providers to offer the service in all towns with a population of more than a lakh.

The DoT is also keen to ensure the service is available in all villages with a population of more than a 1,000, though this plan may get snared in pricing hitches.

Telecom firms can offer services such as faster Internet access, movies on demand and high-end online games through 3G phones.

The spectrum for the phones is likely to be allocated on payment of a stiff fee some time next year.

Senior officials said the government was also exploring the possibility of imposing additional obligations on the prospective players to enhance rural connectivity to realise the ambitious target of pushing up rural tele-density from 1 per cent of the population to 10 per cent within the next five years. The government has already decided to fund towers in rural regions to be used by the private operators to offer mobile phone services in villages.

The government plans to draw on the proceeds of the universal service obligation (USO) fund, set up with the money collected from private players as penalty for failing to fulfil their obligations vis-à-vis rural connectivity, to fund the towers.

The plan is to offer mobile phone connectivity for the villages in phases, starting with basic cellular services and gradually upgrading the network to make it compatible with 3G services.

“The ultimate aim is not only to connect villages but also carry text, data and video to rural areas, new wireless technologies such as 3G or wi-max can help do that ... but right now if an added obligation is imposed we may get operators to use the facility of common infrastructure and actually go to the villages,” the officials said.

The USO funds have mainly been used by BSNL to provide connections to remote regions. Private players have been unwilling to invest in rural connectivity.

“Sharing of infrastructure would bring down the capital expenditure, thus making it cost effective for mobile service providers to ensure faster rollout in remote areas of the country,” a senior DoT official said.

The government proposes to use the USO fund to build about 10,000 telecom towers to be shared by at least three operators to provide 3G services in rural areas.

“3G or third generation technology could be the answer to ‘last mile’ connectivity issues that prohibit Internet connection in rural India,” said Sudipto Basu, a telecom analyst.

The biggest hindrance to 3G services for villages was the pricing, analysts said. The operators will find it viable to initially offer the services in the metros as they will have to shell out a huge sum as licence fee that necessitates a high price for the service.