Etisalat to bid for 3G; more new entrants for broadband auction

New entrant on the block Etisalat DB (formerly Swan Telecom) today submitted its application to bid for a 3G licence, along with the usual Bharti Airtel, Vodafone Essar, Tata Teleservices and Reliance Communications.

Etisalat, the UAE-based telco, which has bought a majority stake in Swan is one of the half-a-dozen new operators that are rolling out services in India. Telenor, the Norway-based company which had bought a majority stake in Unitech Wireless, had earlier announced its interest for 3G in a few cities, but not applied so far.

In the broadband wireless access (BWA) space — the technology which enables high-speed wireless broadband — there were a lot more new applicants: Vodafone Essar, Tikona Digital, a company promoted by former Reliance Communication employees, and Tata Communications (formerly VSNL). The other surprise was Qualcomm, so far a chip vendor in India, which applied for the BWA bid yesterday. A few months ago it had reservations about the technology.

When contacted, a telecom ministry official confirmed receiving the applications. The last date for submitting the applications is March 19. Auction for 3G will start on April 9, and after two days of its closing will be the auction for BWA.

In a statement, Tata Communications said it considers wireless to be the best option to rapidly increase broadband penetration in India. The company would finalise its funding plans for the broadband business, including evaluating the option of a strategic investor, after the auction.

The Department of Telecommunications (DoT) will auction three slots of 3G spectrum in most of the circles. The reserve price for pan-India spectrum has been fixed at Rs 3,500 crore. For BWA, there are only two slots with the minimum base price at Rs 1,750 crore for a pan-India licence.

According to the Notice Inviting Applications (NIA) for 3G, out of the 22 circles, five — Punjab, Bihar, West Bengal, Himachal Pradesh and Jammu & Kashmir — will have four private players each. The successful bidders would be allowed to offer 3G services commercially from September 1, 2010. The process has already been delayed a number of times due to differences between DoT and the defence ministry over vacating of spectrum and the number of slots to be auctioned. A mock bidding will be held on April 5 and 6, followed by the final auction on April 9.