India's auction of BWA spectrum has ended, and the country looks set to have two technologies running in its 2.3GHz TDD spectrum, following wins in four regions by Qualcomm. The chip giant had bid in the auction in order to gain a foothold for its favored TD-LTE technology, in a country whose broadband wireless agenda has been dominated by WiMAX - but with TD-LTE at least a year away from full commercialization, this could create unwelcome delays to India's broadband expansion in key circles like Delhi.
The auction ended after 16 days and 117 rounds, raising $5.48bn for two sets of licenses, plus the national license already shared by state-owned BSNL and MTNL (the latter in Delhi and Mumbai, BSNL everywhere else). These two will be required to pay the same price as the private bidders and their retrospective fees will raise the total to $8.23bn.
The big national winner was not one of the big three cellcos - all of which were hoping to add BWA spectrum to their recent 3G hauls. This would have supported convergence and boosted their overall frequencies, in a country where all carriers are spectrum starved and capacity is desperately behind demand. Instead, only Infotel Broadband Services gained spectrum nationwide. The somewhat obscure player is a member of the WiMAX Forum and indicated it would use WiMAX for its national build-out because of the immediate availability of cost effective infrastructure and devices.
Eleven telcos had bid for licenses, including the major cellcos Bharti Airtel, Reliance, Idea Cellular, Aircel, Vodafone and Tata Communications. However, they were already cash-strapped after arguably overpaying for their 3G spectrum a few weeks earlier, and Reliance said it exited the BWA process a week ago as bid prices started to exceed its business case estimates. Bharti did win spectrum in four of the 22 circles, but said prices had gone higher than it had expected, and will pay INR33.14bn for its holdings. Other winners were Aircel, in eight circles, Tikona in five, Qualcomm in four and Augere in one. All except Qualcomm are expected to use WiMAX in order to start build-out quickly, to meet India's desperate shortage of broadband access.
Qualcomm was quick to celebrate its own wins, which are significant for TD-LTE because they include the key population centers of Delhi and Mumbai, where the firm's consortium will compete against MTNL's WiMAX network, already underway, and Infotel's. The US firm paid $1.05bn for its holdings, which it will consider a bargain to gain a foothold in one of the world's largest markets for its preferred technology. The platform may have a tiny position compared to WiMAX, but if nothing else, this will add to the credibility of TD-LTE as a standard with an ecosystem that stretches outside China, and may prepare the ground for FD-LTE, when India auctions its mobile broadband spectrum at some unspecified future date. At this stage, the major cellcos are expected to enter the fray again and acquire new frequencies around 2.6GHz for HSPA expansion and/or 4G.
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