BWA auction launched; government expects Rs15,000 crore

The auction for Broadband Wireless Access (BWA) spectrum started today, with telecommunications minister A Raja expecting to reap Rs15,000 crore from it.

This comes after the recently concluded 3G auction alone earned the government over Rs67,000 crore, while the government expected only up to Rs40,000 crore from the 3G and BWA auctions combined.

Eleven telecom companies are in the fray - Bharti Airtel, Reliance WiMax, Idea Cellular, Aircel, Augere Mauritius Ltd, Infotel Broadband Services, Qualcomm, Spice Internet Service Provider, Tata Communications Internet Services, Tikona Digital Networks and Vodafone Essar - for two slots of spectrum. The bidding is expected to be as aggressive as it was for 3G services.

The reserve price is Rs1,750 crore for a pan-India BWA spectrum licence. After experiencing success in 3G spectrum auction the government is now hopeful that the BWA auction would also bring higher revenue windfall.

''I expect the competition will be very high for BWA ... as competitive as 3G. I am expecting Rs15,000 crore from the BWA auction,'' Raja said in Hyderabad on the sidelines of an international telecom conference.

Global investment bank Rothschild and telecom auction services provider Dot.econ are advising the government on the BWA auction.

The department of telecommunications says the aim of the auction is to award spectrum transparently and fairly to generate revenue for the public purse, ensuring effective competition and getting a market-determined price for the spectrum.