x
Mobile services

Reliance Jio Entry Hots Up Indian Auction

Reliance Jio's entry into India's forthcoming spectrum auction looks set to ignite bidding during an airwaves sale that was already expected to garner more than 900 billion Indian rupees ($14.5 billion) for the country's government (See India Targets $10.3B From Spectrum Auctions.).

With the process due to begin on March 4, eight service providers have now applied to participate in the auction of frequencies in the 800MHz, 900MHz, 1800MHz and 2.1GHz bands. As well as Reliance Jio, those players include Bharti Airtel Ltd. (Mumbai: BHARTIARTL), Vodafone India , Idea Cellular Ltd. , Reliance Communications Ltd. , Tata Teleservices Ltd. , Aircel Ltd. and Uninor .

The stakes were always going to be high. Bharti Airtel, Vodafone, Idea and Reliance Communications -- India's big four -- are battling to retain licenses in the 900MHz band, used to support voice and text-messaging services.

But in joining the race, Reliance Jio has ensured that bidding will be even more aggressive. As the only operator with a nationwide license for Broadband Wireless Access spectrum (in the 2.3GHz band), Reliance Jio is planning to launch 4G services later this year. It also managed to pick up some 1800MHz spectrum during auctions held last year.

Even the absence of Sistema Shyam TeleServices Ltd. seems unlikely to subdue bidding. The operator, majority owned by Russia's Sistema JSFC (London: SSA), has decided not to bid in the auction, partly because spectrum on offer in the 800MHz band is not contiguous with existing holdings, hindering its ability to provide higher-speed services. (See Spectrum Pricing Provokes Jitters in India .)

Sistema had been the only operator to bid for 800MHz spectrum during an auction held in March 2013. But other players will probably view 800MHz as a decent alternative in circles (areas) where there is a risk they may lose their 900MHz licenses. Reliance Jio is also likely to bid aggressively in both the 900MHz and 800MHz bands.


For all the latest news from the wireless networking and services sector, check out our dedicated mobile content channel here on Light Reading.


In the meantime, Bharti Airtel, Idea and Reliance Telecom (a unit of Reliance Communications) have taken legal action in protest at some of the auction rules. Bharti Airtel claims these are preventing it from bidding for additional spectrum in the Karnataka, Mumbai and Delhi circles, where it already owns as much spectrum as authorities allow. Reliance Telecom has filed a petition urging the government to raise the limit on 1800MHz spectrum holdings. Idea has also complained to authorities the auction rules put operators needing to renew licenses at a disadvantage.

With court cases threatening to delay auction proceedings, the coming days are likely to witness a surge in legal activity as authorities and operators look to resolve their differences.

— Gagandeep Kaur, contributing editor, special to Light Reading

Jatins 2/19/2015 | 5:07:15 AM
Reliance Jio 90,000 crore is a huge money to shell out for upcoming auctions. Reliance is historically known as someone who is good to go for losses to kill competition from day 1. While the company may focus on 800 MHz band, it will also bid for 900 and 2100 MHz. Bharti seems to be best placed in these auctions. 
HOME
Sign In
SEARCH
CLOSE
MORE
CLOSE