Make 3G base price affordable: Airtel CEO

The proposed base price of $20 million in 3G spectrum auction is prohibitive, said Sanjay Kapoor, Bharti Airtel's chief executive officer (CEO) for India and South Asia.
“To draw a high spectrum price is like killing the golden goose,” Kapoor told The Daily Star during his short visit to Dhaka last month.
He deems the proposed base price to be high in comparison to emerging markets, particularly in Africa, and suggested that it be kept at the very minimum level and let the market mechanism work out the value.
Citing India as an example, he said the high spectrum prices do not present a “strong business case”.
“Indian subscribers have been enjoying 3G services for two years now, but the penetration remains very small in comparison to the overall size of the market.”
“How will the operators create a business case with the inflated spectrum prices? Ultimately, the customers will have to pay for the prices,” the Airtel CEO said.
He further said the company would be “very happy” if the proposed base price was made “more affordable”.
With the regards to the Indian and Bangladeshi governments' decision to launch the 3G service via the state-owned operators, he said it is not a conducive idea.
“Multiple operators are needed to set up the technology. One operator can not produce the ecosystem needed to operate the service.”
He is however hopeful that the 3G technology will eventually bear its fruits.
“As the penetration grows, so will the dividends -- in most countries it took 5 or 6 years.”
Kapoor also touched upon the issue of the lack of profitability of all mobile operators in Bangladesh bar Grameenphone, blaming the country's business-unfriendly regime.
“Taxation in Bangladesh is far too high in comparison to other countries. But the mobile tariffs are very low. In fact, it is the second lowest in the world. The revenue source is very diagonal.”
To be able to provide good-quality service to the customers the industry has to be profitable first, he said.
“But for that, industry-friendly policies and regulations are required,” said Kapoor, while stressing the need for more than one operator to be profitable for the industry's sustainability.
It will eventually become unfeasible to make the investments required to keep up with the constantly evolving technologies -- if there are no profits, he said.
“In the end, customers would be the losers.”
Airtel, which has been in operation in Bangladesh since 2010 after purchasing Warid Telecom's majority stake, ranks among the top five mobile service providers globally in terms of subscribers.
Innovation, a robust business model, prompt execution, leadership, high-skilled management and the concept of 'customer is king' are the ingredients behind the success of the company that operates in 20 countries of South Asia and Africa, Kapoor said.
“The company has two separate management teams: one for Africa and the other for South Asia. We never divide our attention.”

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