LBS: Stuck In A Conflict

Department of Telecommunications and Indian telecom operators are at loggerheads again and this time the casualty is Location Based Services (LBS).

Operators have failed to meet the DoTs deadline of May 31, 2012 for the deployment of LBS. Telcos have cited unavailability of relevant solutions and the gigantic cost factor. (See LBS: Stuck In A Conflict and IndiaWatch: DoT Sets Deadline For LBS.)

"We found no adequate solutions which work on both GSM and CDMA networks and expect the government to direct us to the right technology which meets their guidelines. Also, we want the government to take a clear stand on who will bear the cost of implementation as it is their requirement," says Rajan Mathews, Director General, Cellular Operators Association of India.

It is unclear why telcos will need solutions that work on both GSM and CDMA networks simultaneously. We tried to find out but despite our best efforts, telecom operators refused to respond to the questionnaire for this story.

Their claim doesn't hold much water since many vendors say they have solutions which are complaint with DoT's demands.

The government had earlier mandated the operators to deploy LBS platforms with location accuracy of 50 meters. COAI had then raised concerns on the cost of implementation and privacy anxiety of subscribers.

Research suggests that the technology's revenue potential is not insignificant. Juniper Research predicts that mobile location-based services will account for US$12.7 billion (INR 706.4 billion) in revenue by 2014. Two major revenue streams of LBS are application downloads and advertising.

Amongst the Indian operators, Tata Teleservices Ltd. is the only one to have deployed LBS platform for its enterprise segment. The telco offers services like vehicle tracking, cargo management and consignment tracking, among others.

With this, one more conflict between the government and operators has emerged besides the countless other prevailing regulatory issues. The government seeks to track down unlawful activities using the service while the telcos are blaming the faulty norms framed by the government. (See Telcos May Move TDSAT Against DoT Penalty, IndiaWatch: 2G Auction In A Delay Loop and IndiaWatch: Tax Dept Seeks Legal View On Vodafone.)

Industry watchers, however, dont approve of the complete indifference by the operators in adopting this service.

"The operators should have a broader view while implementing the location-based service which can be provided as an additional VAS [Value Added Services] to end consumers for information like real-time traffic update and not just for security measures [as needed by the government]," says Katyayan Gupta, analyst at Forrester Research Inc.

He adds that the government should assist the operators on the cost factor and not let the telcos bear the burden alone.

"There should be a public-private partnership system where the government can share a part of the implementation cost," says Gupta.

The government has not yet responded to the missing of the deadline by the operators which worsens the entire issue.

LBS can prove beneficial for end-consumers in the day-to-day life if given a proper thought by the government and operators. (See IndiaWatch: DoT To Penalize Five Telcos, IndiaWatch: DoT Favours 17% Further Hike For 2G and IndiaWatch: DoT Seeks Advice On Arbitration.)

Rimit Singh, Correspondent, Light Reading India