In a bid to capture a larger pie in telecom infrastructure, GTL Infrastructure will develop 6,700 shared towers by March 2008, at a cost of Rs 2,030 crore. The company has already inked a deal with Spice and Idea for shared infrastructure projects. Each tower would accommodate three to four operators.

Reliance Communications and Hutch are the other major players in this field.

Vikas Arora, VP, marketing, GTL, said, "Sensitive installations such as defence, ports, railway and regulatory authorities do not permit construction of towers. Shared towers are the only option for such areas. And with the union ministry's aim to take the mobile penetration to the rural areas, operators will have to share towers. It will give them a competitive edge."

Since ARPU is at 0.002 dollars in India, sharing infrastructure is an option to lower costs. It will work on an anchor tenant basis, and fees would be paid in the form of rentals. However, the rent to be charged would be decided later.

Prakash Ranjalkar, chief operating officer & director, GTL, says that the company will raise equity to suit the project requirements. It has Rs 1,000 crore in the bank - Rs 320 crore equity and Rs 700 crore debts. He adds, "We are willing to raise money and look at equity partners." He informs that GTL is planning to acquire 10,000 existing towers at a cost of Rs 800-Rs 900 crore. "At present, these towers do no have a sharing capacity. We are working on strategies for those and would disclose details at a later stage."

Andrew Seybold an analyst with Andrew Seybold Group LLC has identified data voice as the current rage. He says, "India stands next to US in the usage of data voice. Indians spend 451 minutes on data voice versus Hong Kong that spends 407 minutes. The US spends 789 voice minutes over telephone."

"The split ratio between voice data ARPUs is 73:27. I expect the model to follow in India. At present, India has the lowest ARPUs at 0.002 dollars," adds Seybold.
According to G.Venkatesh, CTO, Sasken, "Telecom players need to work on a long term strategy for voice based offerings."

In November, Reliance Communications approved a scheme for transfer of existing wireless towers to a 100% subsidiary. Anil Ambani, chairman, ADAG in a press statement said, "This is the first of a series of initiatives we will be taking to remain asset-light, and enhance our competitiveness, ultimately leading to unlocking of further value for the benefit of our nearly 2 million shareholders."

Nripendra Misra, chairman, TRAI, expressed," The capital costs for creating new infrastructures are formidable. It is estimated that 60% roll-out cost of a mobile service is towards setting up of passive infrastructure and only 40% contributes towards active infrastructure / electronics. Therefore, passive infrastructure sharing among mobile service providers assumes crucial importance, as it allows more than one service provider to leverage and ride on common infrastructure."

It is observed the growing mobile subscriber base is putting immense pressure on the scarce resources of spectrum, infrastructure and interconnection. As of today, lack of point of interconnect is a critical bottleneck hampering the expansion of telecom service. It is also adversely impacting the quality of service parameters of all the service providers.

Infrastructure Sharing can also promote greater service-based competition and reduce infrastructure duplication.