Winners of broadband wireless access (BWA) spectrum will soon get a head-start over their 3G counterparts as the government will allot spectrum to the winners immediately. The move will allow BWA winners to roll out their networks across the country and start offering services on a commercial basis in the near future.
An early rollout of BWA services is possible since BWA spectrum is available with the telecom department and can be allotted soon. On the other hand, defence forces currently occupy 3G spectrum, which will be vacated only in August.
Ashok Chandra, joint wireless advisor, department of telecommunications (DoT) didn?t specify the date by which the spectrum would be allotted but said that it would be allotted immediately. DoT would issue letters of intent to BWA winners within a week?s time and spectrum would be allotted as soon as the formalities are completed, JS Deepak, joint secretary, DoT said.
This spells good news for Mukesh Ambani-led Reliance Industries, which made a surprising entry into telecom with its acquisition of Infotel, which won BWA spectrum for all 22 circles. The company will be able to test the waters on a pan-India basis on the new technology platform without any competition from incumbent telecom operators. No single telecom operator was able to secure a pan-India slot in either the BWA auction or the 3G auction.
As reported by FE on June 22, RIL is in talks with state-run MTNL to franchise its 3G services in Delhi and Mumbai. If the deal materialises, RIL will be ahead of other operators as MTNL?s 3G network is functional with close to four lakh subscribers. In contrast, incumbent operators will be able to start 3G services only by September, after defence forces vacate the spectrum in August as per an understanding between the defence ministry and DoT.
Apart from Infotel, the country?s largest telecom operator Bharti Airtel won only four BWA circles, while Aircel won in 8 circles. Infotel emerged the only pan-India winner and RIL acquired the company for Rs 4,800 crore within hours of the completion of the BWA auction. Among the other BWA auction winners, Tikona won five circles while Augere Mauritius won the Madhya Pradesh circle.
CDMA chip maker Qualcomm won a slot in four circles but the company will test the spectrum for its LTE technology and not use WiMAX, which is an established BWA technology. However, most incumbent telecom operators like Reliance Communications, Idea Cellular, Vodafone-Essar and Tata Teleservices pulled out of the auction and didn?t win a slot in any circle.
The price of a pan-India slot for BWA was Rs 12,847 crore. The government auctioned two slots to private operators at a reserve price of Rs 1,750 crore in the 2.3GHz band. One slot was reserved for state-run MTNL and BSNL.