3G mobile service set for India launch

Decks were cleared today for launching 3G mobile and broadband services in the country, with the government allocating air waves to private operators after making certain amends to the licence terms.

The operators are authorised to use the spectrum for a period of 20 years from today, according to the amended licence conditions that allows companies to offer 3G services till the validity of the spectrum even if their telecom licences expire prior to that.

The government has imposed a roll-out obligation, under which the service providers would have to cover at least 90 per cent of the service areas in the metros within the next five years.

Bharti Airtel, Vodafone, RCom, Tatas, Idea Cellular, Aircel and S Tel were the operators who had bagged 3G spectrum in the auction in May that fetched the government over Rs 51,000 crore apart from about Rs 16,000 crore from the two telecom PSUs -- BSNL and MTNL.

BSNL and MTNL were awarded spectrum more than a year ago in view of their obligation to procure equipments through cumbersome process of inviting tenders. BSNL offers services throughout the country, except Delhi and Mumbai where MTNL is the operator. The operators have been awarded 5 Mhz of spectrum in each circle they won in the auction.

In the two metros of Delhi and Mumbai, three operators - Bharti Airtel, Vodafone and Reliance Communication had emerged the winners while no operator could bag pan-India spectrum in the auction that was conducted between April 9 and May 18 this year.

The government had auctioned three 3G slots throughout the nation, while four slots were offered in five circles. 3G allows high-speed mobile broadband access enabling users to download full length movies, make video calls and watch live television programmes.

According to the amendment, if the operators fail to achieve the roll-out obligations, they would be given extension for one more year after paying 2.5 per cent of the spectrum acquisition charge per quarter.

Also, in case of two companies merging, only one slot of spectrum can be retained, according to the amended rules. The operators will have to pay the upward revised spectrum usage charges ranging between 3-8 per cent depending upon the quantum of spectrum held by them.