New Delhi: The government has formally kicked off the process of setting up so-called 3G, or third generation, mobile phone services in 22 telecom services areas by inviting companies to bid for rights to manage the auction of radio frequency, or airwaves, used for these services.
After this, the government will move ahead to invite telecom operators to bid for the actual 3G licences.
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The government aims to raise up to Rs40,000 crore, or 75% of its revenue deficit, by selling the spectrum electronically.
A 3G mobile phone service allows customers to surf the Internet or download content, including music and video, at speeds faster than current technologies allow.
According to the request for proposals, or RFP, document on the website of the department of telecommunications (DoT), the process for selecting an agency for electronic auction will begin on 18 August and will be completed with the finalization of bids on 23 September.
A pre-bid conference will be held on 27 August with DoT clarifying questions from the bidders on 29 August. The submission of technical and financial bids has been set for 3 September.
Technically qualified bidders will be finalized and declared on 18 September and will be followed by opening of financial bids for electronic auctioning the next day.
T.V. Ramachandran, director-general of the Cellular Operators Association of India, or COAI, the GSM lobby, welcomed the guidelines.
KEEPING TRACK (Graphic)
Auctioning of spectrum is to be conducted for the three metro cities of Delhi, Kolkata and Mumbai; five category “A” circles, eight category “B” circles, and six category “C” circles. They have been grouped based on the number of potential subscribers in each area.
Spectrum refers to the airwaves that allow communication between wireless devices, such as mobile phones and walkie-talkie radios.
DoT has said that firms that are registered under Indian company law, foreign companies incorporated in a country outside India or a joint venture of such companies will be eligible to bid for as an agency for conducting electronic auction. These firms, DoT said, shall not have any equity directly or indirectly in any telecom or Internet service providers in the country, and no telecom or Internet service provider should have equity in the bidder.
DoT has specified that the bidder should have a combined networth of at least Rs25 crore, or $5.84 million, and also should have conducted at least five e-auctions for a total value of at least Rs2,500 crore, or $584 million, in the last three years.
According to 1 August government guidelines, the ministry intends to sell spectrum blocks of 2.1GHz band for 3G services and spectrum blocks in 2.3 and 2.5 GHz bands for broadband wireless access, or BWA.