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India 3G auction ends

The government will earn about US$11 billion from the auction

By , IDG News Service
May 19, 2010 09:01 AM ET

IDG News Service - India's auction of 3G spectrum ended on Wednesday after 34 days of bidding, with India's top three operators, Bharti Airtel, Vodafone Essar, and Reliance Communications bagging licenses for the coveted Delhi and Mumbai service areas, according to data released Wednesday by the country's Department of Telecommunications (DOT) said.

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The highest bid for a service area was in Delhi where a license now costs Indian rupees 33 billion ($728 million).

This is close to the base price for a national license across all 22 service areas of the country, which had been earlier set at 35 billion rupees.

The Indian government is now likely to earn 509.6 billion rupees ($11 billion) from the auction.

No single bidder has won in all the 22 service areas. The government auctioned three slots in most circles, with a fourth slot offered in some service areas such as the states of Punjab, West Bengal and Himachal Pradesh.

One slot in each service area was allotted ahead of the auction to government-owned service providers, Bharat Sanchar Nigam (BSNL) and Mahanagar Telephone Nigam. These companies will be required to pay license fees equal to the highest bid in each service area, DOT said last year.

There were nine bidders for the auction, all of whom were incumbent service providers. Bharti Airtel, the largest operator, won in 13 service areas, as did Reliance Communications, the second largest operator. Aircel, another service provider, also won in 13 service areas.

Vodafone's Indian joint venture, Vodafone Essar, which is the third largest service provider, won in nine service areas.

The results of the auction are provisional, and subject to government approval, DOT said. The auction started on April 9.

 

The 3G auction is to be followed by another for spectrum for broadband wireless access (BWA) services. There are 11 bidders in this auction.

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