India's 3G Auction Ends, Raises $14.6B

After 34 days of bidding, India's 3G spectrum auction has come to an end, raising 677.2 billion Indian rupees (US$14.63 billion) in fees.

No one operator won spectrum in all of India's 22 circles (service areas). Three carriers -- Aircel Ltd. , Bharti Airtel Ltd. (Mumbai: BHARTIARTL), and Reliance Communications Ltd. -– won spectrum in 13 circles, though because they won in different areas they will pay different amounts. Bharti Airtel's total 3G spectrum bill is INR123 billion ($2.66 billion), while Reliance will shell out INR85.9 billion ($1.86 billion) and Aircel INR65 billion ($1.4 billion).

Idea Cellular Ltd. was successful in 11 circles, for which it will pay INR57.7 billion ($1.25 billion).

Tata Teleservices Ltd. and Vodafone India both won spectrum in nine circles, and startup operator S Tel Pvt. Ltd. has 3G spectrum in three circles. Fellow newcomers Etisalat DB and Videocon Telecommunications Ltd. (a.k.a. Datacom Solutions) failed to win any licenses.

The country's three leading mobile players -- Bharti Airtel, Reliance Communications, and Vodafone Essar -- each prevailed in the key metro markets of New Delhi and Mumbai, where the licenses will cost INR33.17 billion and INR32.47 billion ($717 million and $702 million), respectively. State-owned operator Mahanagar Telephone Nigam Ltd. (MTNL) has already been handed spectrum in those cities -- now it will have to pay INR65.64 billion ($1.42 billion) for that capacity.

The other state-owned operator, Bharat Sanchar Nigam Ltd. (BSNL) , will have to pay the equivalent of the winning bids in the 20 other circles, where it already has 3G capacity. That will cost the carrier INR101.9 billion ($2.2 billion).

The end of the 3G auction now sets the scene for the next sale of Indian wireless airspace, as the BWA (broadband wireless access) auction will start in two days, with 11 bidders (including some that have just finished the 3G marathon) involved. (See Bids Flood In for India's Spectrum Auctions.)

— Ray Le Maistre, International Managing Editor, Light Reading