In India, one rarely witnesses or anticipates “launch hype” around product introductions in the share prices of their makers. This is quite unlike the US or Hong Kong where stocks often rise in a spectacular fashion on the back of first few days/weeks’ successes of some new gadgets or sales at new property projects. So, could the 3G launch be an exception?
First let us see why most people are unenthused ? First, companies have paid apparently astronomical amounts to be able to start the business and none have bothered to justify why. Second, the 3G service launches in most countries in the past were a normal event with a few benefits here and there but nothing that changed the prospects of telecom service providers comprehensively. As such, what is paid as licence fee should be sunk cost in an efficient market by now. But what is more important for forward looking investors is whether 3G could change the prospects or expectations of telecom companies compared to the existing forecasts.
Why it is likely to be different in India ? – A Contrarian’s Views –
India’s information hungry locals have already skipped laptop/desktop revolutions to a large degree and have directly moved to the more useable latest generation cellphones. There is a possibility, quite a strong possibility according to the authors of this note, that 3G subscribers as a percent of total will reach as high as 25% or more by 2015.
Well what about the Spectrum for so much Data Transfer, Future Auctions etc. Technically not a feasible solution so far.