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India's 3G auction suffers further delay

23 апреля 2008

India's Department of Telecommunications (DoT) will auction off 3G spectrum in two phases this year and next due to delays in freeing airwaves currently in use by the country's defence forces, reports the Economic Times.

However, the defence forces will need to keep using a tranche of spectrum earmarked for mobile operators because the construction by BSNL of an alternative network for the armed services is running behind schedule, according to the paper.

As a result, the second phase of the auction cannot take place until after March 2009, by which point the defence forces are expected to have transferred to the alternative network.

This latest delay marks the fifth time the deadline for auctioning third generation licences has had to be extended, according to the report published Monday.

Furthermore, this means in the first phase of the auction there will only be enough spectrum to share between three operators, meaning other hopeful 3G players will have to wait until next year before they have an opportunity to bid for a licence.

"Several operators had already approached the department seeking that only a joint auction be carried out after all three armed services, Air Force, Army and the Navy, vacate radio frequencies," said DoT sources, cited by the Economic Times.

This development is the latest in the ongoing saga of
India's struggle towards 3G deployment.

In March the DoT finally decided to hold a global 3G auction, meaning foreign companies including new market entrants would be allowed to participate.

The Indian government had already given the green light to this move, but the Telecoms Regulatory Authority of India (TRAI) delayed proceedings by arguing that the auction should be limited to existing GSM operators.

What's more, the DoT recently revealed it was mulling whether to raise the base price for a 3G licence from INR10.35 billion (approximately $260 million) for 5MHz, to INR22 billion (approximately $550 million).

This would mean that a new entrant with the option of bidding on two 5MHz blocks would have to pay a starting price of over $1 billion.

Источник: Total Telecom

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