Researching mobile Phone Industry & India's 3G auction

There are difficulties in doing research related to cell phone market. Cell phone users are widespread across regions and before researching anything related to cell phones, the sample size taken should be well enough to represent all sectors. The validity of the research conducted should be verified. Biased responses should be avoided. The sample size should be large enough to arrive at a conclusion. One may encounter problems when analyzing from small sub samples.

In the case of the article, cell phone usage and political preferences may not correspond to those that are most commonly used to weight polls. It is now very difficult, for instance, to get young people on the phone when using a land line-only sample. More than 50 % of all adults from age 25-29, for instance, are cell phone-only, and two-thirds are either cell phone-only or cell phone-mostly. The numbers are actually slightly better for adults aged 18-24, who are more likely to be living in a college dormitory, or still to be living at home, where a land line will usually be available. Coupling this with the fact that young people have grown up in a call-screening culture, and their response rates are often completely inadequate.

The main problem with the study is that weighting seemed to work just fine for multiple pollsters during the 2008 election when there was a historic turnout of alleged cell phone only demographics.

One of the ways by which Indian cell phone providers can track usage and billing statistics is through concentration on demographics.

Nine telecom companies forked over $14.6 billion to the government for coveted 3G mobile spectrum. The question now is: Will they ever get their money's worth?
The auction further broken India's hyper-competitive mobile market and forces Indian telecoms to make steep payouts even as a price war crushes profit margins.
Moreover, converting customers to 3G in a nation whose work force is still dominated by small farmers could prove challenging. Many Indians in rural areas, which have driven subscriber growth, may be content with affordable, basic voice services for years to come. Many companies feel that they overpaid.
It remains to be seen how companies will tie up or consolidate to provide nationwide coverage to their 3G subscribers.

The auction format and severe spectrum shortage along with ensuing policy uncertainty drove the prices beyond reasonable levels. This fractured auction results, with smaller players would lead to a further splintering of the mobile industry.

It's also not clear to analysts whether most Indians need 3G spectrum. India's mobile market is far from mature, adding 20 million users a month, many of them in rural villages where they have little use for the fancy data services, video calls and high-tech graphic applications that 3G makes possible. Only 5 per cent of mobile owners have handsets with 3G capability.

The telecom industry has been India’s biggest infrastructure success, and the operators would like to see good times continue. To recover their investments, the 3G spectrum winners will have to focus on customers with high ARPUs. In a country where the ARPU is already low, overpaying for 3G will definitely affect the bottom line. Whether telecom can pull off this gamble remains to be seen.