Auction for BWA begins; Rs.15,000 crore expected

New Delhi/Hyderabad, May 24 (IANS) The Indian government expects a revenue of Rs.15,000 crore ($3.2 billion) from the auction of airwaves for broadband wireless access (BWA) services which kicked off Monday, Communications minister A. Raja said.

‘I expect the competition will be very high for BWA… as competitive as 3G. I am expecting Rs.15,000 crore from the BWA auction,’ Raja said in Hyderabad on the sidelines of an international telcom conference.

BWA spectrum is essential for rolling out Worldwide Interoperability for Microwave Access (WiMAX) services enabling hand-held devices and laptops to access the Internet.

It will allow the winner companies to offer high-speed Internet access as well as internet telephony and television services. The spectrum can also be used for voice and high-speed data services.

As many as 11 companies — Bharti Airtel, Reliance WiMax, Idea Cellular, Aircel, Augere Mauritius Limited, Infotel Broadband Services, Qualcomm, Spice Internet Service Provider, Tata Communications Internet Services, Tikona Digital Networks and Vodafone Essar — are participating in the BWA auction.

It is a simultaneous online auction for two slots in each of the country’s 22 service areas. The government has set Rs.1,750 crore as the base price for a pan-India slot.

The government has already allocated one block of 20 MHz of unpaired spectrum each to Mahanagar Telephone Nigam Ltd (MTNL) and Bharat Sanchar Nigam Ltd (BSNL) in their respective service areas.

The two state-run telecom firms will have to pay the winners’ price.

The successful bidders in this auction can use the assigned frequency for commercial purposes immediately after they get the spectrum.

Global investment bank Rothschild and telecom auction services provider dot.econ are advising the government on the auction.

The auction to award spectrum for third generation (3G) telecom services concluded last week, fetching Rs.67,718.95 crore ($15 billion) to the state exchequer.

The government had estimated to rake in Rs.35,000 crore ($7.75 billion) from the auction of airwaves for both 3G services and broadband.

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