New Telecom Network Guidelines For India in June

The government is expected to issue guidelines for third generation (3G) and wireless broadband (WiMax) networks by June, according to Minister for Communications and Information Technology A Raja.

"By June the guidelines will be issued for 3G and WiMax," Raja said at an industry conference, adding that these networks would be rolled out by January 2009.

Once the 3G and WiMax networks are rolled out, mobile users in India will have access to high-end data applications on their mobiles, including high speed interactive gaming and Internet access, video conferencing, video streaming and various other multimedia features.

The government had unveiled the broad guidelines of its 3G policy in November last year.

Raja said all the radio frequencies for offering 3G and WiMax services would be offered via an auction process, where all telecom firms - existing operators, licence holders and new international players - would be allowed to bid.

He said that this platform would help increase broadband penetration in the country.

According to a senior telecom department official, the new base price for 3G spectrum (where each operators gets 10 MHz) is most likely to be Rs 16 billion ($40 million) for Delhi, Mumbai and other category A cities.

Operators in category B cities like Chennai and Kolkata will have to shell out Rs 8 billion ($20 million), while for category C cities the base price will be Rs 3 billion ($7.5 million).

"All this would add up to Rs 28 billion for an all-India licence," said an official.

CDMA players will be allocated 3G spectrum in the 800 MHz band. They would have to pay an amount proportionate to the highest bid for spectrum in the 2,100 MHz band.

The official said that players offering 3G and WiMax services will also be subject to an additional spectrum charge of 0.5 percent of their total revenues, which will be increased to one percent after three years of allotment of 3G spectrum.