Tata Tele to spend $500 mn for 3G rollout: executive

Tata Tele to spend $500 mn for 3G rollout: executive

Bangalore: Tata Teleservices, India’s No. 4 mobile carrier, launched its 3G wireless data services ahead of larger rivals and on Wednesday said it will roll them out across its nine telecom zones by the end of year.

Tata Tele, 26% owned by Japan’s NTT DoCoMo, has set aside $500 million for spending on 3G networks, managing director Anil Sardana said at a media briefing.

India’s top mobile operator Bharti Airtel plans to launch 3G services before the end of 2010 while No. 3 operator Vodafone Essar is eyeing a launch in the January-March quarter of 2011.

Last month, Vodafone Essar, controlled by Vodafone, said it plans to spend up to $500 million within two years on its 3G networks.

“As the consumers see value in what 3G can provide... the total wallet size for telecom will increase," said Deepak Gulati, executive president of the mobility business.

He predicted consumers would spend 10-15% more on telecoms in the next year due to 3G services.

Tata Tele will disclose pricing of its 3G services in a week, Sardana said. They will initially be available in 25 towns as of Thursday and will expand to cover 125-150 towns by the year’s end, he said.

The company, which won rights in an auction this year to offer 3G services in nine of India’s 22 telecom zones for Rs5, 864 crore ($1.3 billion), is also talking to other operators to offer these services beyond its nine zones, he said.

Tata Tele had more than 80 million mobile and fixed-line subscribers as of the end of September.

India is a late adapter of 3G and is the largest economy without the premium services on a large scale, though the state-run telecoms firms have 3G services in some areas.

With 3G services, carriers’ margins are expected to improve as data services offer a higher profit than voice. But premium services may take time to pick up in a price-sensitive market like India.