3G auction price Delhi, Mumbai to command most at $ 128 million and $ 112 million

The must-awaited launch of 3G services of private players would happen only by the financial year 2010-11, say industry experts. 3G auctions are expected to happen by the end of calendar year 2009 and spectrum allocation to take place within the next five months of auctions, followed by the launch of services.

Ambit Capital, estimates in its Telecom Ector report for 2009 that Delhi will emerge out to be the highest priced circle with likely bid amount in the range of $ 128 million (Rs 6400 million). Next to follow will be Mumbai at $ 112 million (Rs 5600 million). The reason for high price point in Delhi maybe due to the fact that there are only two blocks available for auction which may result in competitive and aggressive bidding.

Other circles with high auction price include Gujarat at $ 104 million and Andhra Pradesh, Karnataka, Maharashtra as well as Tamil Nadu at $ 80 million.

Other circles with high auction price include Gujarat at $ 104 million and Andhra Pradesh, Karnataka, Maharashtra as well as Tamil Nadu at $ 80 million.

Access to 3G spectrum will free up huge amounts of capacity on GSM networks and allow operators to offer data services. This means they will be able to provide more bandwidth on their 3G platforms, in turn improving service to higher ARPU subscribers. After the launch of 3G, value added services (VAS) which now constitute 6-10% of the total telecom revenue, would rise to about 20-25% of the total earnings.

Initially, 3G services will be launched in the top 40 cities to target high value postpaid subscribers

MTNL and BSNL have already launched 3G services. BSNL, in its first phase of 3G roll-out, is set to cover 750 cities, MTNL will introduce 3G in Mumbai later this month