The lack of spectrum and, in some cases, its inefficient utilisation is taking its toll on the quality of service and call drops are becoming exasperatingly frequent. So much so that in late 2006, a survey by the Telecom Regulatory Authority of India revealed that only one of 128 cellular operators meets the overall customer satisfaction benchmark of 95 per cent.

"It's beginning to hurt. The network sucks due to lack of spectrum," agrees Rajat Mukerji, vice president, corporate affairs, Idea Cellular.

The Aditya Birla group company's entry into the lucrative Mumbai circle is one of those affected by the spectrum roadblock.

"We want a pan-India presence and hope to get clearances soon to have a nationwide footprint," Mukerji says.

Meanwhile, playing the high volumes game is a threat to operators' margins. Already, the average revenue per user (Arpu) for GSM services is falling (from Rs 316 in December 2006 to Rs 298 in March 2007) and although CDMA Arpu is increasing (from Rs 196 to Rs 202 over the same period), it is still lower than the GSM figure.

It doesn't help, either, that pre-paid customers comprise over 85 per cent of the total cellular subscriber base and account for an overwhelming 96-97 per cent of all incremental additions.

Typically, prepaid customers run up lower bills and are a floating population with high churn levels. "It is like choosing between the devil (having pre-paid subscribers) and the deep sea (not having them at all)," says an analyst.

The churn will only increase, as will competition, if (when?) Trai introduces number portability (by which a subscriber can retain his mobile number even if he changes the service provider).

A para-military force soldier from India's Rapid Action Force (RAF) calls relatives on her mobile phone during a farewell function ahead of her unit's departure to Liberia on a United Nations Peacekeeping mission. It was the first time the world body deployed an all-female unit.

Photograph: Raveendran/AFP/Getty Images

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