Limited mobility is not a part of technology feature. This was used in one of the operators specifications. The view of the operator was to restrict subscriber mobility to a level below that is being offered by the GSM operator.

CDMA is another mobile standard. This standard was being extended to provide fixed wireless service. In a WLL scenario, it is inherently possible to receive and make calls within the service area, subject to the possibility of mobility of telephone instruments. In other words if the handset could move, one could get the advantage of mobility in a given base service area. If the phone was fixed, then it became a fixed wireless phone. Is it fair for the existing GSM operators? Was any mobile operator fair to the subscribers? Was DoT fair in their broad decision? These questions need to be answered.

Limited Mobility (How Limited?)
One could restrict the mobility to either a Base Trans-Receiver Station (BTS) area or a group of BTS areas. BTS can safely provide 2-km service radius in the urban areas. The Base Station Controllers (BSCs) control groups of BTS. If different BSCs are made to speak to one another, one could get complete mobility in a larger area. This simply means that the mobility becomes subscribers choice, as he chooses the handset. This evolves automatically from the fact that if WLL is provided, mobility of the subscriber is imminent. At the maximum, the operator can restrict his mobility to a BTS area or a BSC area or a group of BSC areas. Incidentally, lesser the BTS in numbers greater will be the mobility area. In addition under radio propagation conditions, service area spillage is imminent.

As NTP mentions WLL as a usable technology, perhaps it is difficult at this stage to restrict WLL from the armory of basic operators. Consequently, the limited mobility offers various options to the subscriber. But then, what are the options? We need to study business cases for different areas (metros and circles). Variables that impact service and business are too many. Assumptions need to be made. Different models taking real costs and prices into account have been made for different, yet realistic scenarios and inferences drawn. These inferences could help make decisions or could stimulate healthy dialogue for consensus and for the overall welfare of all.

The Controversy
The controversy arose when basic service licenses were to be issued. Why? One has to go back into GSM licensing to understand this. GSM licenses were issued for metros and circles. (Circles, for all purposes can be assumed to be the states, example UP (E), MP, Tamil Nadu, AP, etc). As the licensing procedure would have it, the prospective GSM operators quoted higher prices for circles (in anticipation of large subscriber base) than the metro GSM bidders. Circle license prices were high. To cap this, some rules on spectrum charges interconnect requirements and high backbone system costs, etc, made circle operations not so lucrative as the metro operations. Low subscriber base and low potential added to the non-viability of GSM operations in the circles. Circles also needed longer backbone networks that added to increase investments.

Now when basic licenses for circles and metros were to be issued, DoT said that limited mobility (within the SDCA) would be permitted and that spectrum shall be allocated on first-come-first-serve basis. However, this criterion was not clear. Cellular operators felt that mobility through CDMA WLL shall have an impact on the continued viability of GSM services in metros and further choke circle operators. Moreover, it was felt that there was none level playing field vis--vis DoT and MTNL.

So, the controversy stemmed out of GSM operators business cases. A comparison of conditions as existed now are given in Table 1.

Prima facie, it would seem, from the GSM (mobile) operators point of view that they have an unfavorable case. At this stage, we need to study the cases of metro GSM operations and circle mobile operations separately. The study shows that GSM metro operations are viable while the circle operations are not. Given the WLL mobility, the new business case for GSM has to be studied for circle and metros separately. GSM Vs CDMA (limited mobility), balance sheet has been worked out with certain assumptions and near real prices based costing. Two comparisons have been carried out, one for metros and the other for circles.

P Hari Har Kumar, CTO, Aircell Digiline India

A comparison between GSM metro operator, CDMA WLL by private operator and CDMA WLL by MTNL/DoT, has been depicted below. It is assumed that all the three stated services, which had started in 1995 and reached a subscriber base of 300 K in 2001.

n CDMA network by private operator with prevailing conditions shall be viable after three years from commencement of services. This is due to the fact that the call charges are Rs 1.2 for 3 minutes as compared to Rs 10 (average) for one minute.

n CDMA private operators would have required initial support by way of zero percent revenue sharing for the first three years.

n MTNL, as such, has unfair advantage. In the present scenario, GSM operators can not survive with MTNL CDMA WLL. MTNL does not have to spend money on backbone and infrastructure because MTNL already has enough infrastructure, which can be shared for such services. Subscribers are expected to use GSM network less if the tariffs are different. Call handling capacities of GSM mobiles are limited due to spectrum limitations. Another band will enhance equipment costs.

n MTNL should also pay entry fee and revenue sharing, so as to create level playing field with other private operators.

n CDMA handset is much more expensive, hence subsidy shall be required to improve penetration.

n In order to reduce breakeven period, in case of CDMA networks, revenue sharing should be zero percent for the first three years.

n In case of GSM, greater spectrum should be allocated to avoid early saturation of GSM network capacities. Because, when call charges are reduced to compete with CDMA WLL service, network capacity cannot be enhanced to the same proportion as the call volume/subscribers.

n GSM operators should not be charged Rs 1.2 for revenue sharing for landline calls.

n GoT-IT has to consider circles and metros separately. Should ensure level playing field vis--vis DoT/MTNL operations to make NTP meaningful.

A comparison between GSM circle operator, CDMA WLL by private operator and CDMA WLL by DoT has been depicted below. It is assumed that all three stated services started in 1995 and reached a subscriber base of 50K in 2001.

n GSM network in the circles, in current conditions, cannot survive. (Assumed Rs 3/min call). This is basically due to very high license fee paid in earlier years while subscriber growth could not take off in spite of low airtime charges as compared to the metros. Other reasons for high costs included a need for very long backbone, spread out coverage area, thereby
requiring large number of base stations
in proportion to the low number of subscribers.

n Revenue sharing amount should be
reduced in circles to make the business case viable for GSM operators. It is
recommended to be zero percent for three years and at par with CDMA WLL
services.

n WPC charges in circles to be reduced. Interconnect charges to the fixed operator for landline calls should be removed.

n CDMA is viable, provided the switch at each SDCA is not insisted upon.(Assumed Rs 1.2/3 min call)

n CDMA WLL by DoT in the circles will be profitable provided a zero percent revenue sharing is charged for the first three years as the amount shall be used to provide handset subsidy to increase penetration.

n GoT-IT has to consider circles and metros separately. Should ensure level playing field vis--vis DoT operations to make NTP meaningful.

This case considers that the existing GSM operators are expanding their network in metros while basic service operators deploy new CDMA network. Subscribers growth and revenue pick up is seen at the end of the third year. This also assumes that GSM operator also charges Rs 1.2 per 3 minutes. Other assumptions are given below.

Inferences

GSM present network + expansion Oct 1995 to 2004 (8 years)/New CDMA WLL network (1.4.2001 to 31.3.2009): An eight-year scene.

This case compares an eight years scenario for the GSM as well as CDMA network. This assumes if CDMA had also started in 1995, what would the scene be in 2004.

To let GSM grow, an additional spectrum should be released with 900 MHz/1,800 MHz band. The above cases assume that limited mobility shall be permitted. Without limited mobility, there is no case for CDMA WLL. Such subscriber growth is not possible without low tariffs, handset subsidy and large network capacities. GSM tariffs at 40 paise a minute has been assumed. Subscribers shall benefit. As the fourth operator bids will command more premiums the government will benefit, however, permission for fourth operator should not be at the cost of squeezing spectrum from three operators. Instead, the fourth operator should be allocated spectrum in 1,800 MHz band. There is no denying that he will be at a disadvantage by being given 1,800 MHz reach and cost of dual handsets.