Telecom Roundup: 3G Auction Delayed, 19 Million Subscribers Added in Dec

3G Auction is facing a serious hurdle, after DoT found out 8 loopholes in the policy.

DoT’s finance and wireless wing have questioned the legal implications of having the 3G auctions for CDMA operators in addition to raising concerns over the department’s move to restrict the CDMA auction only to existing players.

Fresh entrants in India’s telecom scene that win 3G spectrum — essential for offering value-added services such as video conferencing and ultrafast internet on mobiles — in the auctions to be held next month will be placed last in the queue of the 343 applicants for 2G airwaves, DoT had said in response to bidders’ queries. This sudden policy flip-flop by the communications ministry meant that new entrants, which win 3G spectrums, don’t stand a chance to get 2G spectrum. As per the country’s 3G policy, successful bidders will get 5 MHz of 3G airwaves. While this is not enough for new players entering the telecom market, it will be enough for existing GSM players to migrate to 3G. The DoT had earlier said standalone 3G winners would get 2G spectrum on a priority basis. – ET

This issue will further add to 3G auction woes and might deter foreign companies from participating.

19 Million Users in December

Telcos added 19 million users in December 2009, and the rally was led by Tata Teleservices (added 3 million subscribers).

Airtel added 2.85 million subscribers, while RCom added 2.8 million subs.

Vodafone refutes tax claim on Hutch deal

Vodafone earliest lost the Income Tax case in Bombay HC and has filed a detailed 1,800 page response to the show-cause notice issued by the Indian tax authorities in October 2009 (more).

If Vodafone loses the case, it will have to cough up to $4Bn and this case will set a benchmark for cross-border deal.

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