Wimax big loser in India's BWA auction
Two clear winners emerged from India’s broadband wireless auction last week: the government and the TD-LTE camp.
The government will net over $8.2 billion from the auction of three licenses in the 2.3GHz band. This is in addition to the almost $15 billion in revenues it secured from last month’s sale of 3G spectrum – double the government’s forecast.
The aggressive bidding in both auctions is a byproduct of India’s chronic spectrum shortage.
But mobile incumbents Vodafone India, Reliance Communications, and Idea Cellular saw sense in walking away from the crazy BWA prices, which is not surprising given their high 3G spectrum fees of $2.48 billion, $1.83 billion and $1.23 billion respectively.
Next to the government, the TD-LTE proponents – led by China Mobile which is pushing the technology as an evolution upgrade for Wimax operators worldwide – emerge as also victorious.
In India, the world’s hottest market for broadband services, the TD-LTE camp now have two aspirants willing to aggressively market the new technology: Infotel Broadband Services and Qualcomm.
Infotel, soon to be a subsidiary of Indian conglomerate Reliance Industries (RIL), intends to be a serious mobile broadband player.
The firm will spend $970 million initially on rolling out TD-LTE. This is on top of the $2.76 billion it will pay for spectrum at 2.3GHz across all 22 circles.
The TD-LTE camp would struggle to find a more eager technology proponent than billionaire Mukesh Ambani, which until last month could not compete in the mobile arena because of a non-compete clause with his brother, Reliance Communications boss Anil.
Qualcomm too has big plans for TD-LTE, having won 20MHz apiece of spectrum in the premium circles of Delhi and Mumbai as well as Kerala and Haryana for 49.13 billion rupees or $1.06 billion.
Qualcomm plans to divest over a 50% stake in its Indian BWA venture, starting with 13% stakes each being bought by GTL Infrastructure’s Global Holding and Tulip Telecom, reports Business Standard, which cited banking sources.
Qualcomm will separately inject 46 billion rupees into the Indian venture, said the report.
That could leave only Aircel to run the main technology race for the Wimax camp, presuming of course it goes down the Wimax route, since it won spectrum in eight regions for 34.38 billion rupees.
But Maxis-controlled Aircel – India’s seventh largest cellco - has also just had to folk out $1.39 billion for 3G spectrum in 13 zones.
The Wimax community had once dreamed of India as its star Asian performer.