Updated: 3G Auction completed after 34 days of bidding

[Honest 836]

DoT's 3G global bid hits snag

30 May, 2008, 0209 hrs IST, TNN

NEW DELHI: The department of telecom’s (DoT) plan to carry out certain amendments to the Unified Access Service Licence (UASL) to allow foreign firms that do not have a presence in India participate in the 3G auctions has hit another roadblock. TRAI chairman Nripendra Misra has shot off a letter to the DoT warning the government that as per the TRAI Act, the recommendations of the regulator should be sought before the DoT can make any amendments to the UASL licence.

Mr Misra’s communication also adds that if the DoT failed to follow this protocol, it could lead to legal complications. The TRAI chairman in his letter to the DoT has also enclosed a copy of the regulator’s revised recommendations of 3G auctions, where it has reiterated that foreign players and new domestic players should not be allowed to bid.

The DoT has planned to make changes in the licence conditions to bypass TRAI’s recommendations and allow foreign players to bid for 3G spectrum. The regulator and the DoT has been involved in a standoff over allowing foreign players to participate in 3G auctions. So far, DoT has been unable to bring out the 3G policy due to its differences with TRAI.

While DoT and finance ministry want new players—including foreign companies—to participate in 3G auctions, TRAI is opposed to the move. Despite DoT asking TRAI to reconsider its stand against allowing international majors, the regulator has refused to budge.

‘The auction for 3G licenses should be restricted to existing operators because they have already made huge investments in infrastructure and will be better placed to deliver 3G services efficiently at low incremental cost,” the regulator had argued. Going a step further, TRAI chairman Nripendra Misra has written to the finance ministry to drop its demand for a global auction.

Meanwhile, communications minister A Raja who met finance minister P Chidambaram on this issue on Wednesday has said that there was ‘broad consensus between both ministries on 3G’, implying that foreign players would be allowed.

“There is a broad consensus on issues concerning 3G telephony But the final decision will be taken after another round of meeting with the Finance Minister,” Mr Raja had told reporters on Wednesday. Last week too, Mr Raja had said that foreign players would be allowed to bid: “If there is common auction or open auction, there will be no bar (on foreign players)”.

Mr Raja also added that he and Mr Chidambaram would meet the Prime Minister to take his guidance on the issue before announcing the policy guidelines for both 3G and WiMAX.

As reported earlier by ET, the DoT has referred the matter to the Attorney General of India (AG). In a bid to avoid legal complications, the DoT wants the AG to clarify whether foreign companies who do not hold telecom licenses in India can be permitted to place their bids during the 3G spectrum auction.

[Honest 836]

TRAI-DoT differences widen on 3G; issue may go to eGoM

1 Jun, 2008, 1557 hrs IST, PTI

NEW DELHI: Government may refer the issue of allowing foreign players in the third generation telephony, which allows faster data transfer, to an empowered-Group of Ministers as differences between DoT and regulator TRAI widen.

The Department of Telecom (DoT) is in favour of allowing foreign players in the 3G segment, while TRAI says it should be limited to existing players as permitting foreign players would negatively affect the affordability of services.

A section in the DoT has also expressed concern over TRAI's interference on policy issues and said the regulator's powers are limited to giving recommendations and the policy has to be framed by the government.

TRAI had earlier written a letter to the Finance Secretary cautioning the ministry over permitting foreign players in 3G services and also to the Telecom Secretary, saying there would be enough competition among the existing mobile operators.

Asked whether the issue has been referred to the eGoM, sources said DoT has not taken a final view but a decision is likely soon.

Communication and IT Minister A Raja is understood to have discussed the matter with Prime Minister Manmohan Singh and Finance Minister P Chidambaram, sources said, but the outcome of the meetings was not known.

Raja had recently said foreign players will be allowed to offer 3G services in India and modalities of allocating spectrum through auction for 3G services would be worked out soon as the matter has been referred to the Law Ministry.

"Whether there is common auction or open auction there is be no bar on foreign players," Raja had said. The country allows 74 per cent foreign direct investment in the telecom sector.

The government is planning to start 3G telecom services by January next year. 3G enable faster data connectivity as well as efficient utilisation of scarce spectrum, sources said, adding that final guidelines for the services as well as for auctioning of spectrum would be announced soon.

The sources said policy guidelines have been delayed as the issue was struck over foreign players participation and differences between TRAI and DoT have widened significantly.

According to them, DoT and Finance Ministry are in favour of allowing foreign players to bid for 3G spectrum to enhance competition and get a higher value for the scarce resource. TRAI says including foreign players would not only complicate the process but also increase the delay in the 3G rollout.

[Honest 836]

Tighter security drill on cards for 3G firms

7 Jun, 2008, 0021 hrs IST, TNN

KOLKATA/NEW DELHI: In the backdrop of an unresolved BlackBerry security row and an impending rollout of 3G mobile services in India, the government has decided to tighten the security drill for prospective 3G mobile service licensees.

The communications ministry will soon direct all companies who want to bid for 3G spectrum to provide national security agencies the suitable monitoring mechanism to track high-speed data transmission on 3G mobile networks. As a precursor, the DoT has asked Telecom Engineering Centre (TEC) to come out with a comprehensive set of regulations for monitoring 3G mobile services. Significantly, DoT has directed its technicial wing, the TEC, to frame the regulations in consultation with the national security agencies.

In an internal communique dated May 27 to TEC, the DoT said: “3G services are likely to be introduced in India soon. These services would entail very high speed data transmissions. It is felt that the present monitoring systems may not be able to handle and deliver the required legal intercept.

The TEC is requested to take advance action for drafting the requisite government regulations in consultation with the national security agencies.” Elaborating, the DoT internal note adds: “There is an urgent need to finalise the necessary monitoring/security-related government regulations before the commencement of 3G mobile services in India.”

DoT sources said that the TEC has been asked to submit norms to monitor 3G services by the month-end. The TEC norms will allow lawful interception without compromising the security of the data and will also specify that telcos must enter into tie-ups with third party software providers who have the tools to monitor, intercept and retian electronic records, sources said.

Put simply, the government is looking at creating a platform where a copy of data sent between two 3G users via their mobile handsets are saved on the servers of the operators in a decrypted format where they can be viewed and forwarded. Such systems are already place in several countries, especially Europe and the US, where mobile traffic is stored in a readable and intelligible format, and is delivered to authorised security agencies in real time. It is also learnt that the TEC norms will specify that traffic originating and terminating in India must not be carried outside the country.

In this light, a senior government official said: “The world over, most countries have their own standards for electronically monitoring voice and data traffic on high-speed digital wireless networks. The US CALEA (Communications Assistance for Law Enforcement Act, 1994) regulation is a classic case in point.

While it could well serve as a model, it is for the TEC and national security agencies like Intelligence Bureau, to take a call on the ideal set of norms to deliver the required legal intercept.” Elaborating, the official added: “The upcoming security guidelines from TEC will hopefully pave the way for greater coordination between future 3G mobile service providers, the DoT and the national security agencies.”

DoT’s decision to monitor 3G mobile servcies may face stiff resistance. Many believe that since a majority of the traffic would continue to be voice and not high-speed data in a 2G (Edge) or 3G digital mobile scenario, there is little sense in coming up with draconian laws. “What is the point of monitoring 3G services, when a majority of such mobile traffic will continue to be voice. Since the monitoring mechanisms for tracking 2G voice communications already exist, what is the point of coming up with a separate bunch of regulations to track 3G mobile data traffic.”

[Honest 836]

Vodafone asks DoT not to follow US model for 3G bid

6 Jun, 2008, 0136 hrs IST, TNN

NEW DELHI: The Vodafone group (which owns a controlling stake in Vodafone Essar) has asked DoT not to be influenced by the high prices that the US government got during the recent spectrum auctions. Instead, the UK-based global telecom major has asked the DoT to consider the methodology followed by countries such as Egypt, Kenya, Turkey, Nigeria and Indonesia, and arrive at a benchmark price for the spectrum auctions in India. The logic: these are non-European countries with moderate GDP per capita who had awarded 3G licences recently, Vodafone said.

Vodafone also blamed the recent US auctions and said that this development had resulted in many governments around the world exploring the prospects of getting similar returns. ‘The large sums raised by the US government are likely to increase the determination of other governments to find spectrum of their own.

It is important to note that the frequency released in the US at 698-806 MHz will not be harmonised with the spectrum being targeted in Europe (790 - 862 MHz) or in African or Asia”, the company’s business arm for emerging markets, said in a communication to the DoT.

The telco has also pointed out that it debatable whether US prices indicate likely proceeds in other markets. “Overall US cellular operators face greater spectrum scarcity than their European counterparts at a time when many are also undertaking wholesale migrations between different technology platforms of a kind which are simply not being attempted elsewhere,” the company said.

According to Vodafone, the US auctions were different since telcos were forced to bid for additional spectrum to restore parity with AT&T. This is because, AT&T had purchased spectrum from Aloha last year and held a clear advantage as the quantum of radio frequencies it held was higher then other operators in the US.

Vodafone has also argued that the auction structure also meant that bidders were seeking to build large contiguous footprints and in the process were bidding against local bidders with a potentarrive at a benchmark price ially higher valuation. “This kind of structure is specific to the US as national licenses remain the norm elsewhere,” Vodafone’s communication added.

[Honest 836]

Raja's 3G foreign push hits DoT roadblock

9 Jun, 2008, 0032 hrs IST, TNN

NEW DELHI/KOLKATA: Even as communications minister A Raja has gone public several times over his intentions to let foreign players bid in the upcoming 3G auctions, serious differences appear to have cropped up within department of telecom (DoT) over this issue.

DoT has prepared a note for prime minister listing out the advantages of limiting the upcoming 3G auctions to existing players. The note also lists several disadvantages of allowing foreign players in via an international competitive bidding as suggested by the finance ministry and Mr Raja.

Incidentally, the DoT note to the PM comes even as Mr Raja and finance minister P Chidambaram are slated to meet Mr Manmohan Singh to press their case for a global 3G auction. It is also learnt that the DoT had a high-level meeting with telecom regulator TRAI, who has bitterly opposed the entry of new players, before preparing the note for the PM.

ET has learnt that the primary reason for a section of DoT supporting TRAI and not Mr Raja on 3G is on account of the upcoming probe by the Central Vigilance Commission.

Sources confirmed that the CVC will soon open a probe against the communications ministry on three grounds, the DoT’s move earlier this year to award licences for Rs 1,651 crore, a fee fixed in 2001, for failing to follow TRAI’s recommendations of 2003 that future allocation of 2G spectrum should be via an auction process and also over the DoT’s move to allot start-up 2G spectrum to dual-technology licence holders such as Reliance Communications, ahead of other applicants in the queue for radio frequencies. “Against the background, a significant section does not favor Raja,” a source added.

What complicates the matter even further is that amidst all these developments, another section of the DoT known as the Wireless Planning and Coordination Wing (WPC), has come out with the draft recommendations for 3G policy, which states that all players, international majors, new domestic entrants and even non-licence holders be allowed to bid.

The WPC, in its draft policy, has proposed a base price of Rs 160 crore for metros and category A circles, Rs 80 crore for category B and Rs 30 crore for category C circles.

However, the new DoT note to the PM complicates issues further for Mr Raja. This is because, the note lists four advantages for allowing only existing licensees to bid, current players can ensure enough competition, roll-out will be faster as existing players can provide services in 6-8 months while the time period is likely to be 2-3 years for new players, rollout of exclusive 3G networks by new players will be expensive and will result in higher tariffs and 5 MHz of spectrum will not be sufficient for new players for their 3G network rollout.

At the same time, it also says that if an international competitive bidding as suggested by the finance ministry is adopted, since there were already 342 applicants who are waiting for licenses and 2G spectrum, and these players my go to court and delay the process.

Besides, it also points out that telecom regulator TRAI in its recommendations had said that only existing license holders be allowed to bid, while adding, “Many developing countries have been allotted 3G spectrum to existing 2G licence holders. In UK, the 3G auctions in 2001 got large revenues but the rollout was delayed for several years."

The DoT note to the PM comes immediately after yet another communication from TRAI chairman Nripendra Misra. TRAI in its latest communication to DoT secretary Siddharth Behura dated May 24, has listed out six legal complications over allowing foreign players to bid for 3G spectrum.

[Honest 836]

TRAI again warns against foreign bid in 3G spectrum auction

11 Jun, 2008, 0015 hrs IST

NEW DELHI: There seems to be no end to the ongoing controversy over allowing new domestic entrants and international majors to enter the upcoming auction for 3G spectrum. Telecom regulator TRAI has sent yet another communication to the department of telecom (DoT) warning the government against any proposal to allow international majors to bid for 3G spectrum.

TRAI, which had recommended that the 3G auctions be limited only to existing telcos, is bitterly opposed to the plan of both—communications minister A Raja and finance minister P Chidambaram—to have an international auction. So far, DoT has been unable to bring out the 3G policy due to its differences with TRAI.

TRAI Chairman Nripendra Misra in his latest communication to the DoT secretary Siddharth Behura has warned that allowing new players to bid for 3G spectrum will give these companies a backdoor entry to offer 2G services in India. (Currently, all mobile services offered in India run on 2G or second generation cellular networks).

TRAI’s logic: Successful 3G bidders will compulsorily have to acquire a UAS licence before they can begin operations. The UAS licence entitles them to 4.4 MHz of start-up 2G spectrum. TRAI has also argued that the claims of 342 UAS applicants who are currently waiting for spectrum in different states cannot be overlooked ‘because the grant of UAS licence is strictly on the basis on seniority which is the date of application’.

Mr Misra has also said that allowing international majors may result in a scenario where only one or two of the existing 12 plus operators in a circle will get 3G spectrum. “This will result in migration of high value/creamy/layer of subscribers from the existing operators to these 1-2 operators. This may result in creating chaos in the telecom sector apart from effecting the balance sheet of existing operators in a major way,” the TRAI chairman added.

TRAI has also told the DoT that since new players, if allowed, would launch 3G services in phases, subscribers of these operators will initially get these high-end services only in select areas where they have networks in place.

“This will result in subscriber dissatisfaction as this subscriber will not be able to get any mobile service in areas where 3G network has not been rolled out. On the other hand, the existing licensee needs to provide only an overlay 3G network over their existing 2G network. This apart from facilitating a faster rollout will also ensure that the subscribers are able to at least a voice based services in the whole of the service area.”

[Honest 836]

3G operators must go rural

12 Jun, 2008, 0026 hrs IST

NEW DELHI: Telcos in the upcoming 3G auctions will not be allowed to restrict these high-end services to just metros and large cities. The department of telecom (DoT) has decided that service providers will be subject to ‘spectrum hoarding cess’ of 2.5% of the amount they bid for 3G spectrums, for every quarter, if they fail to meet the stringent rollout obligations stipulated by the government. This implies, successful 3G bidders cannot roll-out limited services, nor sit on the radio frequencies allotted to them.

The DoT has also finalised the rollout norms. Under this, within three years of being awarded 3G spectrum, the telco’s services should be available in a minimum of 30% of all district headquarters and cities and towns in that circle, off which at least 10% should be in rural areas. At the end of five years, the telco’s services must be present in 90% of the metro area and 50% of all district head quarters and cities and towns, of which a minimum 15% should be in rural areas.

“If operators do not achieve their roll out obligations, they would be given one year within which to fulfill their roll out obligations. Within this one year, the operators would be fined a spectrum hoarding cess of 2.5% of their winning auction bid per quarter. If operators do not complete their rollout obligations even within this one year, their spectrum assignment would not be canceled and spectrum allotted via an auction to a new operator,” the DoT said in an internal note.

The DoT note also adds that the period of spectrum allotment, based on the auctions would be 20 years from the date of allotment of radio frequencies. “If the period of existing telecom licence of a successful bidder is expiring before this period of 20 years of spectrum allotment/licence for 3G services, its existing UAS licence will be extended to a date of 20 years from the date of 3G spectrum allotment at a price.

This price would be determined by multiplying the number of years of licence extension required by the pro-rata annual licence fee of the UAS licence,” the note added. The DoT, in another note, has also said that the government could raise about RS 1840 crone by extending the licence period to Telcos who successfully bid for 3G spectrum.

As reported earlier by ET, state-owned Telcos BSNL and MTNL need not participate in the upcoming 3G auctions. Instead, they will be allotted one block of spectrum at the price paid by the highest bidder. The DoT has also finalised the base price for third generation spectrum — Rs 160 crore for metros and category A circles, Rs 80 crore for category B and Rs 30 crore for category C. ET has first reported last year that these base price figures, which are double that prescribed by telecom regulator Trai, would be adopted by the DoT.

[Honest 836]

FM favours global auction for 3G

13 Jun, 2008, 0022 hrs IST

NEW DELHI: Finance Minister P Chidambaram and communication minister A Raja are learnt to be in favour of endorsing an international competitive bidding for allocating 3G spectrum. In a meeting on Thursday, Mr Chidambaram is said to have asked Mr Raja to put in place policies that will pave the way for auction of 2G spectrum, both for new players and existing operators. Also present in the meeting were DoT secretary Siddharth Behura and finance secretary D Subba Rao. The developments could not be confirmed as ET’s calls to Mr Raja’s mobile went unanswered.

The decision by both ministries on 3G implies that international communication majors and new domestic players will be able to participate in the upcoming auctions. At stake were four things: Entry of global telecom majors who do not yet have a presence in the world’s fastest-growing telecom market, future profitability of incumbent telcos, the size of revenues accruing to the government from spectrum auction, and the cost of telecom services for the consumer.

Sources said all these issues were discussed and both ministries had decided to endorse an ‘open global auction’, despite telecom regulator Trai and existing operators here being bitterly opposed to the move. The decision by both ministries also implies the issue of allowing foreign players may not be referred to the Group of Ministers (GoM) as recommended by the attorney general of India.

Mr Chidambaram, in an earlier communication to Mr Raja, has said that 3G auction among existing license holders, as recommended by Trai, was not a workable option. He had also added that international competitive bidding model may be used with several clauses to ensure rollout of services and that the auction is restricted to serious contenders.

While it could not be confirmed, sources said that during the meet, Mr Chaidmanbaram also empahised that all allotments of 2G spectrum beyond 6.2 MHz be auctioned. Currently, all telecom services in the country operate on 2G radio frequencies. If this is methodology is followed, additional chunks of spectrum to existing players will be awarded by an auction process as against the existing policy where additional radio frequencies are allotted when the service provider reaches certain pre-defined subscriber base.

Sources added that during the meet, Mr Chidambaram also said that the prices raised by auction should be applied retrospectively to existing telcos who already hold spectrum beyond 6.2 MHz.

While the finance ministry has been constantly demanding that 2G spectrum be auctioned, it is not known if Mr Raja and the DoT will agree to this as the existing policy entitles GSM players to a maximum of 15 MHz per circle and CDMA players up to 7.5 MHz/circle. Besides, any move to auction 2G spectrum would also require changes in existing guidelines and appropriate amendments to the existing license terms and conditions.

The finance ministry had earlier sought that if the DoT fails to auction spectrum both for new players, cross technology license holders and existing players, then all players be charged a one-time fee of RS 1,312 crone for every MHz of radio frequency allotted to them. If implemented, this will imply that all new entrants, who have paid Rs 1,651 crore entry fee, which guarantees them 4.4 MHz of GSM spectrum, would have to shell an additional Rs 4,121 core.

In a bid to ensure a level playing field, the finance ministry had also proposed that the one-time spectrum fee must be applied to existing telcos from the time their spectrum capacity crossed 6.2 MHz. On this basis, several leading GSM players will have to cough up over Rs 3,000 crore as they hold up to 10 MHz of radio frequencies. ET has not been able to establish if the Mr Chidambaram and Mr Raja had discussed this model during Thursday’s meet.

[Honest 836]

3G bidders may have to furnish experience certificate

14 Jun, 2008, 0210 hrs IST

NEW DELHI/KOLKATA: In what will be a rude shock to all new telecom entrants, the department of telecom (DoT) plans to incorporate a clause in its upcoming 3G policy, mandating all potential bidders to have a ‘minimum period of exposure to telecom sector’ to be eligible to bid for 3G spectrum. According to a top source in the communication ministry, the eligibility criterion, or this clause will stipulate that “all telcos should have a proven experience in the telecom sector in India or abroad for a minimum period of one year, and must also have a subscriber base of at least 500,000.”

This means that the likes of Unitech, Datacom, S Tel, Swan Telecom and several others who recently bagged telecom licences cannot participate in the 3G auctions. Besides, it will also rule out the participation of most of the 20-plus firms who are awaiting the grant of telecom licences from the government.

The DoT has the law ministry’s go ahead in the matter, which has said that any possible exclusion of telecom newbies from the 3G race on ‘lack of experience’ grounds would be legally tenable and pose no hurdle for the government. “In respect of new licensees who do not have any prior exposure in the telecom sector, it may be stated that no right has accrued by them for bidding for 3G spectrum. If by fair application of this of pre-qualification norms, some of the existing licensees get excluded due to lack of requisite experience it should not be a legal hurdle in going ahead with the 3G auction,” the law ministry said in its communication to the DoT.

In fact, going further, the law ministry has listed out several judgements from the Supreme Court to assure the DoT that a policy of this nature would pass the courts scrutiny, if it were to be challenged. For instance, the law ministry has pointed out that in the 1994 Tata Cellular vs. Union of India, the Supreme Court had observed that the ‘terms of the tender cannot be open to judicial scrutiny because the invitation to tender is on the realm of the contract’, while also adding that ‘the government must have the freedom of the contract’. The law ministry has, therefore, said that it was within the DoT’s powers to lay down the terms of the contract.

The law ministry has also addressed the DoT’s concerns that new entrants (who hold telecom licenses) can go to the court on the grounds that such eligibility pre-conditions are against Trai’s recommendations that all existing license holders be allowed to bid for 3G spectrums. “It may be pointed out that while Trai recommended that the auction for 3G licenses should be restricted to existing UASL licensees, they only considered the commercial aspects of 3G spectrum and not the right of the existing UASL licensees. It is not in the case of Trai that existing UASL licensees has accrued any right in participating in bidding for 3G licences,” the law ministry’s communication added.

DoT sources also said that finance ministry too was in support of having a ‘minimum period of exposure’ clause. Finance minister P Chidambaram in a recent communication to telecom minister A Raja had said that that international competitive bidding model for the 3G auction must be used with several clauses to ensure that the auction is restricted to serious contenders.

[Honest 836]

DoT keen to offer number portability by mid-2009

15 Jun, 2008, 0122 hrs IST

NEW DELHI: It seems that Sanchar Bhawan is moving at a breakneck speed over the number portability. If you think that the issue is mired by innumerable bottlenecks, here comes the news that the ministry is working overtime to ensure the rollout of this technology-intensive system by the promised June 2009 deadline.

“On June 11 and 12, four major players made their case in front of a high-level DoT team on why they are best equipped to deal in portability. Telcordia, NeuStar, Syniverse and IBC have been filtered after a detailed process. These are US-based companies and have been providing this facility in a dozen other countries. CDot was also present there,” said a senior official in the DoT’s committee on MNP (Mobile Number Portability).

MNP puts enormous power in the hands of the consumers to reject their telecom service providers and opt for another one. This allows the consumers to keep the same number even if they chose to change the service provider.

After these presentations, the next phase will be to float a tender document inviting bidders. “This is new for us and these presentations helped us in understanding what exactly we will be dealing with. After this it is easy for us to prepare the bid document. We don’t want any controversy later, so these presentations gave us an insight of what exactly the bidders want,“ said a senior DoT official.

According to DoT officials, it requires a Rs 80-100 crore investment that will be made by the bidders. The ministry hopes to finalise everything in another two to three months. These companies will bid for setting up clearing houses that would be required for allowing number portability.

TRAI had forwarded to DoT the draft Request for Proposal (RFP) for selection of a single centralised operator for providing and operating mobile number portability solution in the country.

However, in a recently held meeting of the committee, some members opposed this and were in favour of exploring the option of four Mobile Number Portability Clearing House Administrator (MCHAs) and Number Portability Database (NPDB) on grounds of security and anti-monopoly. However, the ministry now is planning to allow two such operators to provide services in India.

“It is a time of convergence and we don’t want to get in too many players. But keeping in mind the large number of population using mobiles, we will limit it to two players,” said the official.

Each service provider will have to be connected to all the MCHAs and NPDB. The companies that will win the bid would act as MCHAS.

[KingofKalyan 0]

DoT keen to offer number portability by mid-2009

Few days before I read a news.. which said DOT would offer in mid of 2008

God knows how long will we have to wait for it

[vmsanghrajka 0]

I think it will actually take another 2-3 years before its completely implemented and available for us..

[KumaarShah 143]

Both 3G and MNP will not be available till end 2009 for us. Effectively you will have to continue suffering the poor services provided by your operator for almost 2 years. And when MNP does comes about, you will have to forget ONNET calls as they will be removed by all operators. Further, MNP will prove to be expensive initially.

As for 3G, wait wait and wait, maybe the next party in power may decide to junk 3G and go in for 8G or 9G as and when it may become available. Our babus are afraid that they may be caught live accepting bribes/etc when 3G is operational, so they will postpone it for some reason or the other.

[raccoon 53]

And when MNP does comes about, you will have to forget ONNET calls as they will be removed by all operators.

That is VERY bad!!! I for one dont think MNP is at all worth it, if it means increased call rates for me!!!

[vmsanghrajka 0]

I think otherwise. I believe, on-net calls would be offered by almost all operators then.. MNP will usher lots of competition which will be good for us.. I know lot of us believe that calling rates would go up, but i believe otherwise.. MNP will mean better service and cheap calling rates (unless big operators form a 'cartel')..

[Honest 836]

NSA review of defence deal may delay 3G rollout

27 Jun, 2008, 0041 hrs IST

NEW DELHI: There may a new twist that could further delay the release of spectrum by the defence forces towards commercial telephony.

National Security Advisor (NSA) is examining all joint commendations made by the defence, communication & IT ministries before releasing the radio frequencies to ensure that the issue of national security is not compromised, said minister of state for defence MM Pallam Raju at the conference organised by industry body Assocham on Thursday.

At present, cellular companies such as Bharti Airtel, Vodafone Essar and BSNL cannot launch 3G telecom services such as mobile TV, interactive gaming and high-speed internet on mobiles unless 3G spectrum vacated by the defence forces is reallocated to them.

“The decision on allocation of spectrum would come only after getting NSA’s observations,” Mr Raju said. The minister also added that the delay in allocating spectrum to Indian Inc has been primarily because the government could not evolve an alternate communication networking system for its armed forces as it has legacy of equipment that are not spectrum friendly.

“Now that the alternate advance telecom system is being restored for the defence and armed forces, spectrum release should not be a problem and the decision on release of spectrum would be taken shortly,” Mr Raju added. The minister, however, did not make any commitment on whether spectrum allocation would be accomplished by the this year-end.

Last year, the telecom and defence ministries had reached an informal agreement under which the latter was to vacate about 25 MHz of 3G spectrum (radio frequencies) to meet the immediate requirements of telecom operators.

It was then decided that the finer details of releasing the radio frequencies and the time frame for the same will be decided by a technical committee headed by national security advisor NK Narayanan. Both ministries also said that the committee would assess the long-term requirements of defence, telecom and other sectors that require radio frequencies, before laying out the future road map for spectrum vacation, its utilisation and allotment.

Sources said that the initial plan was to release about 25 MHz of 3G spectrum by December 2007 and 65 MHz more by March, 2008, but these have been held up on account of two fronts: One, the NSA is yet to clear the same, and second, the DoT is yet to provide an alternative fibre optic network to the defence forces.

At the same time, the defence and telecom ministries are currently involved in a standoff as the former has also asked DoT to spend an additional Rs 3,020 crore to upgrade the alternate network (taking the total cost to Rs 4,000 crore) while adding that this network should be provided without any rental and annual maintenance cost.

[KumaarShah 143]

Spectrum auction: 3G ticket to kick off at Rs 2,260 cr

NEW DELHI: The communications and IT ministry is learnt to have finalised a reserve price of about Rs 2,260 core for telecom companies that want to participate in a pan-India auction for third generation (3G) spectrum in the upcoming policy, which is slated to be announced in the next couple of days.

This is exactly double the reserve price recommended by the Telecom Regulatory Authority of India (TRAI) in its recommendations.

ET has also learnt that the communications ministry, has also decided to allow international communication majors to participate in the auctions for 3G spectrum, but with a rider that foreign firms should have provided 3G services for a minimum period of one year.

The government’s move to allow foreign firms is in contradiction with the TRAI’s recommendations. Existing Indian telcos are also bitterly opposed to the entry of foreign players in the 3G space in India.

Sources said that the new 3G policy would state that telcos would not have to share revenues with the government for the first year of operations. But from the second year, they would have to share 1% of their revenues from these high-end services.

The policy will also have stringent roll-out obligations, service providers will be subject to ‘spectrum hoarding cess’ of 2.5% of the amount they bid for 3G spectrums, for every quarter, if they fail to meet the stringent rollout obligations stipulated by the government, sources added. However, these could not be independently confirmed.

The DoT has arrived at the Rs 2,260 crore figure as follows. The base price for metros and category A circles is Rs 160 crore, while for category B and C circles it is Rs 80 crore and Rs 30 crore respectively. India has four metros, five category A circles, eight category B circles and 6 category C circles.

Meanwhile, there was intense speculation that the 3G policy would be announced on Tuesday. When contacted, a top Department of Telecom source confirmed that the policy has been cleared ‘in principle’ and that they were waiting for telecom minister A Raja to officially announce it. The DoT source also confirmed that there would be ‘no bar on foreign players in bidding for 3G spectrum’, but refused to divulge any further.

The new policy will be a welcome relief for the global telcos who want to enter India via the third generation (3G) route. Despite repeated warnings from TRAI, the government had decided to go in for a global auction and allow new telecom aspirants, including foreign players to participate after the Union law ministry, which studied the issue, has said that it saw no legal hurdles if the government went ahead with the move.

Mr Raja had always maintained that the government wants foreign telecom majors to be allowed to bid for 3G spectrums as this would push up the government’s revenues from the auction. Mr Raja has been supported by finance minister P Chidambaram who has been pushing for a global auction on the grounds that a 3G auction among existing licence holders (as suggested by TRAI) was not a ‘workable option’.

[KumaarShah 143]

BT not in race for 3G services; to serve enterprise clients

3 Jul, 2008, 1737 hrs IST, PTI

HONG KONG: Global communications service provider BT said on Thursday that it would not bid for launching next generation (3G) telecom services in India, but was looking to serve the enterprise segment. The UK-based company is not interested in entering the consumer segment and would rather focus on providing telecom services to the enterprise segment, BT Asia Pacific President Allen Ma told reporters. Department of Telecommunications (DoT) had last year granted international long distance (ILD) and national long distance (NLD) licences to BT. With the government deciding to allow foreign players to offer 3G services in India, it was expected that the likes of BT, AT&T Inc., Deutsche Telekom AG and NTT DoCoMo Inc would show interest in entering the Indian market, the second largest in the world for wireless telephony after China. However, Ma said: "We are not planning to offer telecom services to the consumer segment in India." BT, the oldest telecom service provider, has been trying to brand itself as a networked IT solutions provider than a telecom player. It is planning to strengthen its services segment in the Asia Pacific region and is looking at acquiring companies offering IT services in India. "Globally, the market for networked IT solution services is nearly $100 billion which is growing at 115 per cent in the Asia-Pacific region. India has a very stronghold in IT services. We are looking at acquiring companies having IT capabilities to strengthen our Asia-Pacific operations," Ma said. Across the globe, BT would focus on four main verticals for offering networked IT solutions such as financial sector, manufacturing and logistics, pharmaceuticals and media and broadcasting. In India, the company would focus on the financial sector and media and broadcasting, he added. BT counts Star TV, NDTV, INX and financial service providers such as ICICI and Bank of Baroda among its clients. The company is open to both organic and inorganic growth in the country. However, the focus would be more on acquisitions. However, he declined to comment on the size and scale of the deals. After South East Asia, India is the second largest market for BT in the Asia Pacific region, which accounts for half of the company's global revenues. Asia Pacific and specially India is emerging as an important market for BT as more and more companies are outsourcing there non-core, but mission critical services to others. Moreover, the companies are not looking at vendors but for business partners who can help grow their business, he said.

[Honest 836]

3G guidelines still sometime away

7 Jul, 2008, 2003 hrs IST, PTI

NEW DELHI: The much-delayed 3G policy, which is understood to have got the Prime Minister's approval last week, may yet take some more days to see the light of day as the procedure of PMO returning the guidelines to DoT could be time-consuming.

Moreover, the guidelines have to approved by the Telecom Commission. But its Chairman Siddharth Behura is out of the country and the norms can only be notified after he signs them with the approval of the Commission.

Sources said it it is unlikely that the 3G guidelines would come out before July 15.

Telecom Minister Raja had on Friday met Singh in the presence of Finance Minister P Chidamabaram and apprised him of the 3G norms according to which foreign players could participate in spectrum auction.

The issue of pricing for 2G (second generation) spectrum was also discussed at the meeting.

Both the ministries carry different views on 2G spectrum pricing, which revolves around two points a one-time levy for the already allocated spectrum to telecom companies beyond the contracted value and increasing the annual revenue-share as formulated DoT .

The Finance Ministry, however, wants to auction 2G spectrum for better realisation.

According to sources, the Prime Minister gave the approval for one-time pricing beyond 6.2 MHz of spectrum (radio frequency) in terms of enhancing the spectrum fee by 1 per cent more of Adjusted Gross Revenue.

Few months ago, the PM had said spectrum is a scarce resource and that it needs to be priced appropriately.

A 3G licence would allow operators to offer high speed Intertnet, broadband and video as well as real-time interaction to customers.

[Honest 836]

TRAI agrees to DoT proposal to raise base price for 3G auction

11 Jul, 2008, 1902 hrs IST, PTI

NEW DELHI: TRAI today said it has agreed to the proposal of Department of Telecommunications (DoT) for hiking the base price for the third generation spectrum (3G) auction.

"We have agreed to the DoT's recommendations that the reserve price should be raised," TRAI Chairman Nripendra Mishra told reporters here, adding that the all successful 3G bidders will have to match the highest bid.

DoT had proposed to raise the base price for auction to about Rs 2,200 crore for a pan-India licence.

Earlier, the regulator was not in favour of raising the reserve price. But DoT asked the regulator to reconsider its earlier recommendations that the reserve price of spectrum should not be raised and that new players should not be allowed in the bidding process of 3G spectrum auction.

The minimum bid price for a pan-India licence is Rs 1,400 crore for 3G.

However, the regulator has with held its earlier stand that no new players be allowed in the bidding process. "I strongly believe that only the existing licensees be permitted to participate in the auction, but DoT is competent enough to take a final call," Misra added.

But it is believed that the government has already decided to allow new players including foreign ones to take part in the auction and raised the reserve price for pan-India auction.

The regulator added that it has accepted DoT's suggestion of raising the reserve price of Broadband Wireless Access (BWA) spectrum auction. "We have recommended separate price structures for separate circles," he added.

[Honest 836]

TRAI takes DoT call on 3G, WiMAX reserve price

12 Jul, 2008, 0353 hrs IST, ET

NEW DELHI: The long-drawn feud between the communications ministry and telecom regulator TRAI over the third-generation (3G) mobile services policy has come to an end. TRAI has decided to approve the department of telecom’s plan to double the reserve price for pan-India 3G spectrum auction to Rs 2,260 crore. The regulator is likely to inform DoT of its decision on Saturday.

TRAI on Friday also cleared DoT’s proposal to hike the reserve price for pan-India broadband wireless access (BWA) spectrum — popularly known as WiMAX — to around Rs 840 crore (Rs 60 crore for metros and category A circles, Rs 30 crore for category B and Rs 10 crore for category C circles).

This implies that a telco bidding for both 3G and WiMAX spectrum on a pan-India basis will have to shell out a minimum price or reserve price of around Rs 3,000 crore.

While TRAI continues to oppose DoT’s plan to allow new players — both domestic and foreign — from participating in the 3G auction, it acknowledges that since DoT has followed the proper procedure of referring the 3G policy back to it, the government has the authority to over ride the regulator’s final recommendations.

Telcos, however, refused to comment on TRAI’s approval of the doubling of 3G base price. “So far, neither the government nor TRAI has announced the new base price. We are awaiting the official announcement of the policy,” said an executive with a telco. “The base price has no value for either 3G or WiMAX. Since there are so many players, the auction amount will be very high. DoT would have got the same price in the auction even if it had retained the original base price,” explained a senior executive with another telco.

Internet service providers, however, slammed TRAI’s move to hike the reserve price for WiMAX spectrum.

“Hiking the reserve price for WiMAX spectrum will have a negative impact on the growth of broadband. So far, the country’s broadband growth has been miserable and both DoT and TRAI have done nothing to correct this,” president of the Internet Service Providers Association of India (ISPAI) Rajesh Chharia told ET.

ET had first reported on July 2 that DoT had finalised the 3G policy and hiked the reserve price to about Rs 2,260 crore while also allowing new entrants and international communications majors to participate. DoT had doubled the base price prescribed by TRAI in 2006 and fixed it at Rs 160 crore for metros and category A circles, Rs 80 crore for category B, and Rs 30 crore for C circles, respectively. Since there are four metros, five category A circles, eight category B circles and six category C circles, the base price for a company bidding for pan-India 3G spectrum works out to around Rs 2,260 crore.

While TRAI has okayed DoT’s move to hike the base price for 3G and WiMAX spectrum auctions, the regulator has refused to drop its opposition to communication ministry’s move to allow new players and international communications majors to participate in 3G auction. TRAI wants the auctions to be restricted to existing players.

However, a top TRAI source told ET that the issue of permitting new players, including foreign telcos, to take part in 3G auction was now settled. “We have maintained our stance. DoT has followed the protocol and sought our views. They are well within their right to over rule our recommendations. So this issue is over,” the official explained.

The regulator has also endorsed DoT’s proposal that following the 3G and WiMAX spectrum auctions, all successful bidders be mandated to match the highest bid offer. TRAI had suggested the highest bid should be retained and all other successful players ought to be mandated to match the price of the second-highest bidder.

If the regulator were to send its reply on the 3G policy on Saturday, DoT is likely to unveil the final policy guidelines next week. The 3G policy will be a welcome relief for the global telcos who want to enter India.

[@ksh@T 20]

DoT dilutes pricing for excess spectrum; may cause huge losses

NEW DELHI: The Department of Telecom has diluted the proposed pricing of excess spectrum held beyond the contracted limit by mobile operators, which may cause a loss of over Rs 5,000 crore every year to the government.

According to highly placed sources, the DoT had originally planned to impose annual fixed charges ranging between Rs 15 crore to Rs 290 crore (depending upon the area and amount of spectrum) and also increase the fee as percentage of gross revenues of a mobile operator.

While the revised plan envisages only a marginal increase in the annual fee as percentage of gross revenue by one per cent for spectrum (radio frequency) beyond 6.2 MHz and two per cent for eight MHz and above.

This would fetch the government only Rs 1,250 crore, compared to over Rs 6,000 crore as per the original plan, sources said.

As per the original plan, the DoT had proposed annual charge of Rs 290 crore for 12 MHz of spectrum in metros and also double the fee to 10 per cent of gross revenue from existing level of five per cent.

The Telecom Commission is scheduled to meet on July 18 to consider the proposal and if implemented, this will not only legalise the excess spectrum held by various mobile operators, but would also leave no scope for new operators to expand their operations due to paucity of scarce resource.

Some of the new operators, when contacted, voiced their opposition to the proposed scheme saying this was in sharp contrast to Prime Minister Manmohan Singh's suggestion during India Telecom Summit 2007 that revenue potential of the spectrum for the government must not be lost sight of.

Communication and IT Minister A Raja also met Singh and Finance Minister P Chidambaram earlier this month and discussed the revised proposal and the same has been sent to the Telecom Commission for its approval.

Sources also said that revised pricing would be implemented both for GSM and CDMA based mobile operators having spectrum beyond 6.2 MHz in case of GSM and the equivalent amount of spectrum held by the CDMA service providers.

The new operators, who are yet to start services and have been allotted start-up 4.4 MHz of spectrum, are of the view that the DoT had earlier also succumbed to the pressures of existing mobile operators as it withdrew the report of Telecom Engineering Centre (TEC) suggesting tough subscriber linked norms for allotment of additional spectrum beyond 6.2 MHz.

Sources said that a Memorandum for Telecom Commission has been prepared based on the revised pricing regime and the same has also been distributed among various members and would be taken up for approval on July 18.

[Honest 836]

Telecom Commission to deliberate on 3G policy

13 Jul, 2008, 1215 hrs IST, PTI

NEW DELHI: Telecom Commission will deliberate on the 3G spectrum auction guidelines formulated by the Department and within the next two weeks the policy will be out, Telecom Minister A Raja said.

"3G guidelines almost over...it is going to be deliberated in Telecom Commission... Within 15 days time, it is going to be announced... It is now on the agenda of Telecom Commission," Telecom Minister A Raja said.

Raja has already got the Prime Minister's approval to go ahead with 3G spectrum auction that is likely to see foreign players' participation in the bids and is expected to fetch good revenues to the exchequer.

Sources, however, said the announcement of the policy could be after July 22, after the UPA government survives the a vote of confidence in Parliament. But the Commission which is the highest policy-making body will be ready with its approval for the policy anyway.

DoT now also has telecom regulator TRAI's approval on a higher reserve price, of about Rs 2,260 crore for telecom companies that want to participate in a pan-India auction for third generation (3G) spectrum.

This is exactly double the reserve price recommended by the Telecom Regulatory Authority of India (TRAI).

The department, however, could not have TRAI's nod for foreign players' participation in the process. Existing Indian telcos are also bitterly opposed to the entry of overseas operators in the 3G space in the country.

The base price for metros and category A circles is Rs 160 crore, while for category B and C circles it is Rs 80 crore and Rs 30 crore respectively. India has four metros, five category A circles, eight category B circles and 6 category C circles.

The new policy will be a welcome relief for the global telcos who want to enter India through the 3G route. Raja had said the government wants foreign telecom majors to be allowed to bid for 3G spectrums as this would push up the government revenues from the auction.

Companies such as AT&T Inc, Deutsche Telekom AG, Etisalat and NTT DoCoMo Inc. have expressed interest in the Indian market.

[Arun 795]

Govt to announce 3G policy after vote of confidence

15 Jul, 2008, 2026 hrs IST

Press Trust of India

Government is understood to have decided to announce the guidelines and final policy for third generation mobile services only after proving its majority in Lok Sabha on July 22.

According to official sources, the policy has been finalised and even telecom regulator TRAI has also endorsed Department of Telecom's view to increase the reserve price for 3G spectrum (radio frequency).

TRAI sent back the recommendation on July 14 and Telecom Commission is scheduled to meet on July 18 to consider the 3G policy but it would be announced only after winning the trust vote in Lok Sabha, they said.

DoT had earlier said that foreign players would be allowed to participate in the auctioning process for spectrum for 3G mobile services and if they succeed they would be issued fresh licenses to offer the services.

TRAI had earlier opposed the move to allow foreign players but reconsidered DoT's suggestion and approved it.

Government is estimating to garner about Rs 40,000 crore from the auctioning of spectrum for 3G mobile services and as per the proposed guidelines each player can bid for two blocks of 5 MHz of spectrum in designated band.

Agreeing to DoT's proposal on doubling the reserve price of 3G spectrum for a pan-India license, TRAI has suggested a higher price for the same based on a fresh calculation.

Question is what if the government fails to prove majority? When will the policy be announed then?

[KumaarShah 143]

^^^

If the govt. falls, so will ADA as he is now linked to them very closely through Samajwadi Party. again no MTN takeover also..... no GSM launch also.......He he he

Edited July 16, 2008 by KumaarShah