3G winners may be allocated 2G spectrum

29 Sep 2009

According to a document prepared by India’s telecom ministry, those companies that are successful in bidding for 3G licences and spectrum will also be allocated 2G frequencies, the Economic Times reports. The memorandum is due for release within the next few days, but it is understood that it indicates that new entrants will only be offered 2G spectrum ‘subject to availability’. The move is thought to have been motivated by complaints made by several foreign parties interested in the UMTS licensing process, some of which claim that they could not consider placing a bid in the 3G auction process unless able to offer full mobile services.

Despite the decision, the auction may still struggle to convince those companies seeking both 2G and 3G spectrum, due in part to concerns over the level of available frequencies; the Department of Telecommunications (DoT) can only allocate new 2G spectrum in most circles after the defence forces give up those frequencies that they currently hold. On top of this, there are thought to be over 300 pending 2G applications, which would mean that those operators joining the queue for frequencies face a lengthy wait.

The government has also clarified that those operators seeking to participate in the upcoming 3G auctions, which will take place in December 2009, will be required to acquire unified access service licences (UASL) prior to commencing commercial services. Whilst a UASL in India comes with 4.4MHz of 2G spectrum, the state has yet to confirm, however, whether international operators would be given this spectrum at the time that they obtain the licence.