Foreign telecom operators, who are aspiring to enter the Indian telecom space through the 3G licence auction route, should not participate in the auction process at present as their growth prospects are limited by regulatory and market factors, said a recent report.
They should keep themselves out of the race for the time being and wait for a better time, suggests the same report by research firm Strategy Analytics.
“We believe that foreign operators should adopt a wait-and-watch approach as the licencing and pricing policies will most likely change,” said Rahul Gupta, author of the report.
Foreign operators like AT&T, Deutsche Telecom, NTT Docomo and others, who have been eyeing the domestic market for a long time now, finally have a chance to enter the world’s fastest growing telecom market; however, looking at the current 3G auction policy, it is advisable for them not to participate in the race, the report said.
The report titled ‘3G Scenario in Emerging Markets’ says the government’s 3G policy is not suitable for the foreign players at present due to a number of factors like pricing structure and strict timeline.
“The opening of the 3G licencing process to global players would have been well received initially but on further review, the complexity of the process, the upfront payment requirements and the proposed tight timeline will limit international investment,” observed the report.
Firstly, the upfront payment of almost 500 million dollar without any guarantee of being able to get a licence will frighten many of the operators, it added.
As per a recent statement made by communications minister A Raja, the 3G auction process is set to be completed by October. (PTI)