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India 3G auction postponed until January 2010

India's Department of Telecommunications (DoT) this weekend announced plans to auction 3G licences in January 2010, confirming earlier speculation that the government is unlikely to meet its 7 December deadline.

The new schedule published on Saturday as part of a revised Information Memorandum (IM) revealed that the auction is due to open on 14 January, while bidding for frequencies in the 800-MHz band and broadband wireless access (BWA) spectrum is due to start two days after the 3G auction closes.

The auction was due to begin on 7 December under the schedule announced by the DoT in September; however, speculation that the process was set for further delay was sparked when the revised IM – originally due to be published on 29 September – failed to materialise.

The new schedule announced on Saturday is still subject to change despite the IM's release.

"The government reserves the right to determine the overall timetable of the auctions or to amend it from time to time," said the DoT.

After years of delays the regulator has been coming under mounting pressure to press on with India's 3G auction.

The DoT blamed the most recent hold up on the failure of the country's defence forces to vacate airwaves needed for 3G services. The defence ministry has so far refused to release the spectrum until it has tested an alternative backbone network that is currently being built by state-run operator BSNL.

The ongoing delays last week prompted India's finance minister Pranab Mukherjee to call on the DoT to quickly resolve any outstanding issues and press ahead with the auction before the end of the year.

He warned in a strongly-worded letter to telecoms minister Andimuthu Raja that further delays would send mixed signals to potential investors and jeopardise the 300 billion rupees ($6.45 billion) of revenue that the 3G auction stands to generate.

Although the publication of the revised IM signals the process is moving ahead, timing the auction to take place shortly after the Christmas period could prove problematic for some of the foreign telcos planning to participate; for instance, the final date for applications is 21 December.

Furthermore, although foreign companies will be allowed to participate in the auction directly, the rules stipulated by the DoT say that universal access service (UAS) licences can only be awarded to an Indian company. This means that successful foreign bidders will need to form an Indian subsidiary before they are allowed to commercially launch 3G services.

"Award of spectrum does not confer a right to provide any telecom services, and these are governed by the terms and conditions of the licence obtained by the operator," said the DoT.

In what could complicate matters even more, the DoT is currently being investigated by India's Criminal Investigation Bureau (CBI) for alleged irregularities in the awarding of 2G licences to new entrants in 2008.

The CBI searched the regulator's offices on claims it conspired with private companies to cap the number of licence applicants and that no competitive bidding took place.

Источник: Total Telecom

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