3G data cards, dongles sell well in India


As 3G wireless services catch on in India, so does the demand for data cards and dongles, the plug-in devices used for wirelessly connecting PCs, laptops, notebooks and netbooks to the Internet.

Earlier this month Qualcomm estimated that there are already over half-a-million 3G subscribers in India, thanks to aggressive rollouts by Reliance Communications, Tata Teleservices and Bharat Sanchar Nigam. Most of these subscribers connect to the Internet via dongles and data cards. Qualcomm estimates that at least one million 3G devices will be shipped into India by the end of 2009 though new spectrum is yet to be auctioned.

Users of datacards/dongles in India are estimated by Frost & Sullivan analyst Marc Einstein to rise to 5.55 million by 2013. India would come a close second to China (7.4 million dongle/datacard users by 2013).

While Reliance and Tata Teleservices have deployed EVDO (evolution data optimised) networks using their existing spectrum in 800 Mhz band, BSNL is rolling out HSPA (high speed packet access)-based 3G services. Over 40 cities and towns, including smaller places like Vijayawada, Coimbatore and Vadodara, have already been covered by the three operators. But most subscribers are latching on to RCom and Tata Tele's recently-launched high-speed Internet services through USB data cards priced at around Rs 3,000.

Not to be outdone, BSNL this month invited bids for the supply of 250,000 data cards for 3G. This is for the current fiscal ended March 31, 2010. The bid security amount is Rs.11.4 million. The successful bidder will have to start supplying 25% of the data cards contracted for each month from the third month of getting the contract to the sixth month.

Qualcomm is enabling the growth of the 3G ecosystem in India by making available affordable devices through a wide range of partners. 3G dongles, for example, have already moved from $50 to the $40-mark and Qualcomm is working towards making it available for $25 (Rs1200). Though at present 3G data cards and dongles are being sold by the operators, Qualcomm is working towards making them available off-the-shelf so they can be used with a pre-paid 3G connection from the operators. Reliance has even started offering pre-paid internet dongles.

Mobile operators also have a stake in monetising the demand for 3G data cards and dongles, to complement their mobile broadband offerings and to enable them to amortise equipment and licences faster.

3G dongle and data card services have seen promising uptake all over Asia-Pac, Frost & Sullivan senior industry analyst Marc Einstein notes: "Dongles and datacards are increasingly a preferred connectivity device of choice for Asia-Pac's broadband subscribers given the slim form-factor of the devices, faster 3G speeds and competitive service plans available." He reckoned that by 2013, more than one in every three new broadband subscriber will use dongles or datacards for their mobile broadband needs, giving fixed broadband players a run for their money.

"3G technologies have come a long way since the world's first 3G network premiered in 2001 offering peak speeds of 384Kbps-child's play when you consider what mobile broadband is capable of delivering today," says Einstein. "3G networks today boast of peak speeds of 21Mbps and can potentially peak at 50Mbps to 100Mbps in the next two years." He adds "Mobile operators are aggressively exploring this business segment to make good their already costly investments in 3G infrastructure and provide [at least] comparable [to fixed] broadband connectivity in developed markets like South Korea and Japan where consumers are willing to pay a premium for mobile laptop access."

Some even feel that dongles and data cards would affect growth of the WiFi hotspot market. The argument is that armed with a mobile broadband dongle or data card, any shop, office, library etc becomes a WiFi hotspot.

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