India’s Reliance Industries likely to bid for spectrum: report

Reliance Industries (Mumbai, India) is likely to participate in the forthcoming auction of frequencies that were previously awarded in 2008 but seized by authorities earlier this year, according to a story in India’s Economic Times newspaper.

The company already owns spectrum through its Infotel Broadband subsidiary, but it is not allowed to provide voice services over those frequencies.

Reliance Industries (Mumbai, India) is likely to participate in the forthcoming auction of frequencies that were previously awarded in 2008 but seized by authorities earlier this year, according to a story in India’s Economic Times newspaper.

The company already owns spectrum through its Infotel Broadband subsidiary, but it is not allowed to provide voice services over those frequencies.

According to an unnamed source of the newspaper, representatives of Infotel Broadband have been attending meetings organized by the Department of Telecommunications about the spectrum auction.

The same source is reported to have said that Reliance is most likely to bid directly but might decide to fund a spectrum purchase by another company before acquiring that company.

Reliance bought Infotel Broadband on the same day the company won pan-India licenses to provide wireless broadband services.

A company spokesman declined to comment on the issue, according to the Economic Times, but Reliance would be in a strong position to make a bid, with 70,732 crore rupees ($13 billion) in cash at the end of June.

An acquisition would also allow it to offer both voice and data services to customers and compete alongside India’s best-known mobile-phone brands.

India’s government intends to auction airwaves in the 1800MHz and 800MHz frequency bands from November 12.

The spectrum was previously awarded in 2008, but authorities cancelled licenses earlier this year after finding there had been irregularities in the auction process.

Companies that had their licenses revoked – including Uninor, controlled by Telenor (Oslo, Norway) – are expected to bid for the spectrum they lost in the new auction.

According to the rules of the forthcoming auction, new entrants will have to pay a minimum of 14,000 crore rupees for pan-India services in the 1800MHz band, and a minimum of 9,100 crore rupees for pan-India services in the 800MHz band.

New entrants competing for 1800MHz spectrum will have to bid for at least four 1.25MHz blocks in each service area, while those chasing 800MHz frequencies must bid for at least two blocks of 1.25MHz in each service area.