Only 3 pvt players for 3G services; spectrum auction on Feb 12

The successful bidders would be asked to pay 100 per cent of the bidding amount in March this year.

Last Updated: Jan 11, 2010, 23:49 PM IST

New Delhi: The government is learnt to have decided to allow only three private players to offer 3G mobile services for which the spectrum would be auctioned next month and the successful bidders would be asked to pay 100 per cent of the bidding amount in March this year.

"In the case of 3G auction, the Government has decided to assign by auction up to 3 blocks of 5x2 Mhz of paired in the 2.1 Ghz band in each of the 22 circles," said the draft Notice Inviting Application. The NIA is the legal document containing all relevant information for the bidders.

The said amount of spectrum will be in addition to the one 2x5 Mhz block already allocated to BSNL and MTNL.
In view of spectrum being vacated by the Defence in tranches, the successful bidders would be alloted the air waves simultaneously in September to start 3G mobile services.

Winning bidders will deposit 25 per cent of the bid amount within five calender days from the date of auction and remaining (75 per cent) within 15 calender days, according to the draft NIA.
The auction is expected to he held on February 12.

The NIA is believed to have stipulated September 2, 2010 as the date for commercial launch.

Department of Telecom official were not available for comments on the timing of the NIA to be made public so that applications can be invited formally from the prospective bidders. But sources said it would be issued this week.

Telecom Minister A Raja had earlier said four private players will be allowed to offer 3G services. But lack of immediate availability of radio waves from defence made DoT go for 3 players.

The draft said the last date of inviting applications is January 25. Pre-qualification of the bidders will be held on February 5 and the mock auction to start on February 9 and 10.

3G spectrum is also available for Rajasthan, Assam and North East which was not earlier on the list of auction due to unavailability of the radio waves, according to the draft.

"It is to be made clear that some of the 3G spectrum that is being offered for auction is in the process of being vacated by the present user and it has been decided that successful bidders in the auction will be allowed to launch commercial operations using the spectrum from September 2, 2010," it said.

For the avoidance of doubt, successful bidders will be allocated specific frequency blocks within 15 days from the date of payment of the bid amount and will be allowed to import equipment and conduct testing, the draft added.

Further, efforts are being made to make one more block of spectrum 2x5 Mhz spectrum in 2.1 Ghz band available by January 2013, it said further.

The reserve price for Delhi, Mumbai, Maharashtra, Gujarat, Andhra, Karnataka and Tamil Nadu is Rs 320 crore. The all-India reserve price for 3G licence is Rs 3,500 crore.

Government had earlier said spectrum auction would take place for four slots on January 14. But differences with the Finance Ministry over payment schedule and the defence ministry over spectrum release led to the delay.

Finance Ministry is expecting Rs 35,000 crore from the 3G spectrum auction and had budgeted for the current fiscal to bridge the fiscal deficit.