This section features background information and resources relevant to the current research theme. It includes resources produced by WDR and external sources and is organised by regions and topics. An archive of resources recommended in previous research cycles is also available along with news from the WDR/Intelecon Regulatory News Service.
India: Rural Mobile Auction Results Print E-mail
Friday, 13 April 2007
Results are now in for the bidding process held by the Department of Telecom (DoT) to provide mobile services to 250,000 villages in 81 clusters.

New Delhi Reliance Communications and Bharat Sanchar Nigam Ltd (BSNL) won a majority of the Universal Services Obligation (USO) funds available. At the end of the third and final round of bidding, Reliance won 72 clusters of villages. BSNL won contracts for 58 clusters of villages.

Seven operators participated in the bidding. DoT selected three operators per cluster. The bids quoted are so aggressive that instead of paying the operators for rolling out services in rural areas, the Government will receive money. Based on the operators’ bids, the Government will get about US$ 23,000 a year. Most bids were for negative amounts. While the amount the government will receive may be insignificant, it is interesting that the Government was willing to give away up to US$ 187 million annually to the winning operators.

Idea Cellular, Hutchison Essar and Aircel each won rights to offer service in 15 to 20 clusters. The operators who have won the bids will get the benefit of using “passive infrastructure”, set up with support from the USO fund, without paying any fees to offer mobile service in the rural market. Passive infrastructure comprises land, tower, power connection, and associated civil and electrical works that enable operators to offer mobile service. A majority of this infrastructure will be set up by BSNL, which won a total of 80% of the tenders, winning contracts to set up 6,125 mobile towers out of the total 7,871 passive cell sites envisaged by the Government.

While currently mobile networks cover about 60% of the population, the USO project will extend coverage to an additional 25% of the population who are currently without access to telecommunication facilities.

Source: The Hindu Business Line - WDR/Intelecon Regulatory News.