Broadband wireless bids shoot 34.5 per cent above base price on first day

The auction for broadband wireless access services seems to be going the way of the 3G auction. On Monday, the first day of the auction, bids closed at Rs2,353 crore for a nation-wide licence, a 34.5-per cent increase over the Rs1,750 crore base price fixed by the government.

Total revenues from the sale of three slots of BWA spectrum at the end of the first day of bidding stood at Rs6,940 crore.

The 3G auction had risen only 12 per cent over the base price on the first day. "I expect the competition will be very high for BWA, as competitive as 3G. I am expecting Rs15,000 crore from the BWA auction,'' telecommunications minister A Raja had said on Monday (See: BWA auction launched; government expects Rs15,000 crore). 

The government is auctioning two slots of 20 MHz of pan-India BWA spectrum. As in the case of 3G, state-owned telecom firms Bharat Sanchar Nigam Ltd and Mahanagar Telephone Nigam Ltd are not participating as they have already been allotted the airwaves; but they will match the winning bid at the end of the auction.

BWA spectrum allows companies to offer high-speed WiFi internet access as well as Internet telephony and television services. It can also be used for voice and high-speed data services.

Eleven companies are bidding for broadband wireless access spectrum – two more than those that bid for 3G spectrum. Apart from Bharti Airtel, Reliance, Idea Cellular, Aircel, Vodafone and Tata Communications Internet Services, the BWA list has four new players - Augere, Tikona Wireless, Infotel Broadband Services and Qualcomm, while Spice is making a comeback into the telecom space. Infotel belongs to Anant Nahatta, the son of HFCL owner Mahendra Nahatta.