Telecom CEOs are unanimous: no more 3G auction delays

Wed, Nov 4 02:05 AM

With barely a fortnight to go before a pre-bid conference kicks off the process for 3G and WiMAX spectrum auctions on January 14, the telecom industry has its fingers crossed. The sector's major players have been holding their breath for close to a year now for these auctions to take place, but time after time their hopes have been dashed by delays.

When FE spoke with CEOs of the country's top mobile firms, the underlying message was simple: India is already far behind schedule and with the contentious issue of reserve prices resolved in August, there should be no further postponements. The auctions have already been pushed back from the original December 7 date by more than a month.

Manoj Kohli, CEO of the country's largest telecom operator, Bharti Airtel, could barely conceal his company's impatience. "Indian consumers have waited far too long for the technology and we at Airtel are keen to participate in the 3G spectrum auction. We have the strongest balance sheet and virtually no debt. We don't even need to raise money from the market. If all goes well, we could launch the service by Diwali next year."

Martin Pieters, CEO of the country's second-largest GSM operator, Vodafone-Essar, is normally media shy—since assuming office a couple of months ago, he has refrained from commenting upon most industry issues. But Pieters was hardly reticent on 3G. "We feel 3G services should be made available to consumers in India as soon as possible. We are ready for it and hope that the auction is carried out at the earliest," he told FE.

Tata Teleservices, the country's sixth-largest mobile operator, is just as raring to go. Managing director Anil Sardana said, "The 3G goalposts have been moved more than a few times, depriving Indian consumers of next-generation telecom services. TTSL has been advocating and awaiting quick rollout of 3G services in India, especially as our networks are 3G-ready. Since the eGoM has already charted out the path forward, we are hopeful that the government will adhere to the set timeline."

Analysts explain the mobile firms' eagerness. With average revenue per user (Arpu) falling and 2G facing a severe spectrum crunch, 3G services would be an important differentiator. Not only would it bring in higher Arpu customers, but also by migrating customers to 3G, the 2G spectrum crunch would ease, enabling the accommodation of more subscribers without compromising on quality of service.

Auctions were supposed to be held within 90 days of the eGoM resolving the number of slots for which auctions would be conducted and the reserve price. DoT did come out with a December 7 auction schedule, but failed to release the necessary information memorandum on time.

Communications & IT minister A Raja blamed the delays on the defence forces for not vacating some 20 MHz spectrum required for 3G. He sought the finance minister's mediation in getting the spectrum freed. But with the finance minister in no mood to entertain any further excuses for the delays, DoT announced a revised schedule for holding the auctions from January 14. Accordingly, the pre-bid conference is slated for November 16.

"After inviting foreign operators to participate in the world's fastest-growing telecom market, if the government repeatedly fails to hold the auctions, irrespective of what the reason may be, it will show the country and its policymakers in a very poor light," an official with a foreign telecom operator that is preparing to participate in the auctions told FE.

Inside News

Editor's picks