Thursday, February 28, 2008

AirTel troubles

Apparently Airtel, scheduled to start operations in Sri Lanka this year, have run into some trouble. I like Airtel, it's my operator of choice whenever I'm in India, I've got good memories with it. It worked well for me, and i did do some traveling across states in remote moutanes areas. The Advert above with the two boys playing football is probably my favorite ad on TV.

I was looking forward to the increased competition, I think Air-tel could have given dialog run for their money. I think they have already woken up dialog from a monopoly lethargy and if Airtel do some of the things they do in India, they can lure in customers. Airtel as a brand will have instant recognition from anyone has table, so they have a good start. I don't think I will switch, changing numbers is a bitch unless Air-tel can give me a remarkably better deal.

As for the troubles, a few weeks back in a flight back from Delhi I met a guy from Chandigarh, who's flying to Colombo. He turned out to be a senior telecoms engineer at Airtel, flown down to SL to help with the operations here. I asked him what's taking Airtel so long to set up here, he told me they faced two main problems. one, was permissions issues - Setting up towers and that sort of thing needed all sorts of clearances from the ministry of defense, TRC, and the bureaucracy is taking time. The other, he told me is lack of telecoms engineers, He said latter is going to be a bigger problem in the long-term.

This is probably why dialog have invested in heavily University of Moratuwa, they desperately need the people. All of this is a problem of too much government. in 2006, Lirneasia, a Colombo-based policy research agency concluded the Telecom regulatory environment in Sri Lanka one of the worse in the region and heading in the wrong direction (PDF link). The impact of national security concerns since would only have worsen the situation.

It's heartening however, that the sector has grown tremendously despite having too much regulation. Often times, technology itself is a liberator, government bureaucracies cannot keep up with the dynamism of changing technologies and that's why telecoms 'work' for most people, when fixed-lines become a limiting factor, the industry comes up with CDMA, so on, before the bureaucrats can get their head around that, there'll be another technology.

It just beats me why when simple logic would tell you (and the data backs up the claim) that having barriers to entry, too much of regulation is just bad for business and bad for consumers, yet we are still stuck in this old paradigm of "license-permit" economic (mis)management. sigh.

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