Feeds

Indian 2G auction turmoil as telcos revolt

Foreign investors blame government

The essential guide to IT transformation

Allegations of discrimination against foreign mobile operators, unfairly high start prices for spectrum bidders and yet more government delays have thrown India’s 2G auctions into chaos once again over the past few days.

The original 122 licenses, doled out in 2008, were cancelled in February after the Supreme Court ruled widespread corruption during the original bidding process, and a new auction deadline was set for 31 August.

However, the government has now agreed to ask the Court for another three months to prepare the auction, sparking concerns from telecoms operators, according to The Hindu.

“Such delays are a matter of concern to us as they prolong the uncertainties we face,” said Telenor Group in a canned statement. “We urge the government to conclude the auction process at the earliest.”

The Norwegian-owned company’s uncertainties have been escalated by its decision to exit the joint venture it shares with local property developer Unitech, after the partnership soured in recent months.

Several other foreign investors in Indian mobile network businesses have complained to the government about the way they have been treated, arguing that the revocation of their licenses in February amounted to a breach of their bilateral investment protection agreements (BIPAs).

The Department of Telecommunications has now been forced to deny such allegations, in the following communication seen by Economic Times:

The government of India is of the view that this judgement applies on a fair and equitable basis on all licences. It is added that there is no discriminatory policy or practice being applied against the licence where you (the investor) has equity investment. All the issues related to licensing are being dealt with as per the law of the land on a fair and equitable basis.

It’s unlikely that any foreign investors would pull out of a country set to leapfrog the UK by 2016 to become the third biggest smartphone market worldwide, but many are unhappy at the interminable delays, and the inflated prices they’ll be forced to pay for the licenses.

The reserve auction price has been set at Rs 140bn (£1.6bn) for 5MHz of nationwide GSM spectrum in the 1800MHz band. Although this is some way lower than the first estimate, it’s still seven times that of the 2008 auctions and will costs even more for CDMA operators.

Vsevolod Rozanov, CEO of Russian firm Sistema issued a strongly worded statement criticising the decision:

Given the realistic sectoral environment and market dynamics, I believe that the reserve price for spectrum as approved by the cabinet is excessively high. There is no rationale to support why the 800 Mhz CDMA spectrum should be priced 1.3 times more than the GSM 1800 Mhz spectrum.

All of which makes the UK’s painfully drawn-out attempts to hold a 4G auction appear positively incident-free by comparison. ®

Build a business case: developing custom apps

More from The Register

next story
Hello, police, El Reg here. Are we a bunch of terrorists now?
Do Brits risk arrest for watching beheading video nasty? We asked the fuzz
Detroit losing MILLIONS because it buys CHEAP BATTERIES – report
Man at hardware store was right: name brands DO last longer
Snowden on NSA's MonsterMind TERROR: It may trigger cyberwar
Plus: Syria's internet going down? That was a US cock-up
UK government accused of hiding TRUTH about Universal Credit fiasco
'Reset rating keeps secrets on one-dole-to-rule-them-all plan', say MPs
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
e-Borders fiasco: Brits stung for £224m after US IT giant sues UK govt
Defeat to Raytheon branded 'catastrophic result'
Yes, but what are your plans if a DRAGON attacks?
Local UK gov outs most ridiculous FoI requests...
EU justice chief blasts Google on 'right to be forgotten'
Don't pretend it's a freedom of speech issue – interim commish
Munich considers dumping Linux for ... GULP ... Windows!
Give a penguinista a hug, the Outlook's not good for open source's poster child
This'll end well: US govt says car-to-car jibber-jabber will SAVE lives
Department of Transportation starts cogs turning for another wireless comms standard
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.