U.S. chipmaker Qualcomm Inc plans to bid in India's Broadband Wireless Access (BWA) auction to help spearhead the launch of its next-generation technology into the world's fastest-growing wireless market.
The planned auctions of up to four 3G licences and 2 BWA licences in each of 22 regional zones is scheduled for April and could raise $7.7 billion, mostly from 3G, which allows high-speed Internet access and data transfer on mobile phones.
BWA technologies are important, however, as they enable high-speed wireless data links with better coverage than fixed-line broadband -- key for Internet penetration in India's rural hinterlands, which have poor last-mile fibre connectivity.
There is no restriction on the technology companies can use to provide services for 3G or BWA and Qualcomm said its interest in the auction was aimed at faster deployment of long-term evolution technology (LTE) in India, as it bets on the "inter-operability" between 3G and BWA.
"In India, the broadband potential is massive," Kanwalinder Singh, president for Qualcomm's Indian and South Asian operations told reporters at a news conference.
"Certainly over a five-year horizon, this is an attractive proposition for us," he said, adding rival WiMax technology's business case would be challenged as it did not have inter-operability with 3G networks.
Most international carriers so far have picked LTE to help cope with the surge in data traffic from mobile data cards and smartphones, as the equipment costs are lower than for rival WiMax.
Nordic telecoms operator TeliaSonera launched the world's first LTE services in Norway and Sweden last year and Singh said 59 LTE network commitments had been made in 28 countries, of which 22 networks are expected to be launched commercially by 2010.
Russian state telecoms giant Svyazinvest has chosen LTE technology for its fourth-generation mobile networks, its chief executive said in published comments on Wednesday.
TO BID 'SERIOUSLY' YET 'RESPONSIBLY'
Qualcomm, which previously won spectrum bids in the United States and Britain, was the first applicant for the Indian auctions, for which Friday is last date for submitting applications.
The actual auctions start from April 9. First the 3G auction will be held and two days after it closes, the BWA auction will kick off, the Indian government has said.
New Delhi has set a base price of 17.5 billion rupees ($385 million) for the BWA spectrum in all of India, but bids are expected to come at higher levels. For all-India 3G spectrum, firms have to bid over a base price of 35 billion rupees.
Analysts have estimated firms will have to spend between $1 billion and $1.5 billion for winning 3G spectrum alone as the number of slots are limited and competition is high.
"We certainly intend to bid seriously... We intend to bid responsibly," Qualcomm's Singh said, in response to a question about how aggressively the firm will bid.
"It's premature to talk about that but we have certainly done our home work."
Foreign firms must rope in an Indian partner if they win spectrum in the auctions, as the country's rules restrict direct overseas holding in telecoms firms at 74 percent. Qualcomm said it intended to have Indian partners if successful.
Among other global firms, Vodafone and Telenor, whose ventures already operate 2G mobile services in India, have said they would bid for 3G spectrum.
AT&T, which has been trying to get a foothold in the Indian market, could be a bidder for 3G, while media have also linked Google to be keen for the BWA auction.
(Editing by Simon Jessop)
