3G Auction likely by April 1st week -- 4 Private operators in each circle

In a move that will give the long-pending auction process for 3G spectrum a big push, telecom minister A Raja on Monday said the government will issue a notice inviting application (NIA) for bids from operators by the end of this week. The auctioning of 3G spectrum would start after 45 days of issuing the notice, he added, indicating that the auction would take place only by the next fiscal starting April 2010.

“NIAs will be released this week. Then, auction can take another 40-45 days,” Mr Raja said. The government will auction four slots of 3G spectrum in each circle, in addition to the one already allotted to state-owned telcos BSNL & MTNL, he added. The ministry got moving after the Prime Minister’s Office asked the Telecom Commission, the apex policy-making wing of the Department of Telecommunications (DoT), to wrap up the auction of 3G spectrum by March 31, 2010. It also asked DoT to ensure that each circle has four private players offering 3G services, besides the state-owned telcos BSNL and MTNL.

The 3G spectrum auction has been delayed by close to two years due to glitches over freeing up of spectrum and fixing bid prices. The defence ministry, which is supposed to release the airwaves held by them in phases once the alternative fibre network for the armed forces is ready, earlier accused the telecom department of not fulfilling its commitment of building the fibre network.

The law ministry also objected to a clause in the draft NIA that successful bidders may ask for compensation in case they were not allotted spectrum within the stipulated time. However, the telecom minister on Monday said all these differences among the ministries have been resolved.

For consumers, the urgency shown for the upcoming auction of 3G airwaves means they will be able to access high-end data services including ultra-fast internet, video-conferencing, interactive gaming and mobile TV services by next year when the operators roll out their commercial 3G services.

Currently, all telecom services in the country are offered on the 2G platform, except state-owned telcos BSNL and MTNL who already have commercial 3G services in place. While 2G widely caters to the voice market, 3G is believed to spur data traffic in the country.