India's Department of Telecommunications (DoT) doesn't just form and implement government policy. It operates, as a monopoly, India's entire phone network. Hungry for money, it is in the process of privatising. It will create an independent telecom regulatory authority, to manage cellular services - two private operators in competition in each zone, and basic telephony services.
Scared that the DoT's half a million employees may go on strike, the DoT will not itself be privatised. It will compete with one private operator in each zone, or circle - to use their preferred term. On June 7th and June 23rd the DoT announced the bids for cellular and basic services respectively. Licences for cellular services in major cities were awarded to private companies last year.
On August 5th, the government opened the financial bids for cellular services, listed below. On August 31st, it opened the bids for basic telecom services, also listed below.
CELLULAR SERVICES - OPENED BIDS
The top two bidders are listed here for each circle, followed by a list of the other bids. Contracts were to be awarded to two companies in each circle - the second highest bidder would be given the opportunity to match the highest bid, followed by the third highest bidder, and so on (so that the two eventual licensees pay the same fee). The huge gaps between bids in many circles has posed problems. Now there will probably be caps in the number of circles given to a single operator. Surprisingly, top bidders appear to be in favour of this, as they would like to concentrate on some circles and save on licence fees. Low bidders want caps too, of course, or they will get no licences.
It is not clear whether the bidders will be involved in the decision as to which circles they give up and which they retain, and if they do give up a circle, then whether their high (but now retracted) bid will have to be matched by other potential licencees for that circle. This is not going to be sorted out till the bids for basic services are opened, probably in early October, as providers would naturally prefer to offer cellular services in circles for which they are likely to win basic service licences as well.
Values rounded to the nearest million dollars.
Circles Bidder 1 Value Bidder 2 Value
Group A
AP - JT MOBILE 319 BPL 308
GU - BIRLA 571 BPL 393
KA - MODI 444 (a) BIRLA 420
(b) JT MOBILE 420
MA - BIRLA 528 BPL 466
TN - BPL 266 HINDUJA-HCL 172
Group B
HA - ESCORTEL 78 AIRCEL DIGILINK 76
KE - BPL 165 ESCORTEL 123
MP - CELLULAR COMM 19 RELIANCE 2
PU - MODI 403 JT MOBILE 291
RA - MODI 122 AIRCEL DIGILINK 67
UE - MODI 72 KOSHIKA TELECOM 67
UW - ESCORTEL 129 KOSHIKA TELECOM 82
WB - RELIANCE 13 (sole bidder)
Group C
AN - (no bids)
AS - RELIANCE 0.4 (sole bidder)
BI - KOSHIKA TELECOM 43 RELIANCE 0.8
HP - BHARTI TELENET 5 RELIANCE 0.4
JK - (no bids)
NE - HEXACOM INDIA 0.5 RELIANCE 0.4
OR - KOSHIKA TELECOM 28 RELIANCE 0.8
For circles (regions) graded A, B and C by the government.
Values rounded to the nearest million dollars.
Bids for Group A Circles
AP GU KA MA TN DE
BHARTI | | | | | | |
BIRLA | |1003|1003|2497| |3567|
BPL | | | 878| |1439|2023|
ESSAR | 760| 375| 503|1602| 141|1140|
HFCL |4893|4804| | | |4804|
ISPAT | | |1846|4430| |1846|
MODI | | | | | | |
RELIANCE | 435| 903| 435|2040| 635| 535|
RPG | | 796| | 796|1115|1592|
SHYAM | 535| | | | | 709|
SPIC | | | | | 762| |
STERLITE | 193| | 163| | 283| |
TATA | 580| |1271|3678| |2006|
USHA | | | | | | |
UT |1124| |1254| | | |
VIDEOCON | | | | | 281| |
Bids for Group B Circles
HA KE MP PU RA UE UW WB
BHARTI | 334| | |1170| | | | |
BIRLA | | | | | | | | |
BPL | | 325| | 624| | | | |
ESSAR | 51| | | 288| | | | |
HFCL |1293|3043| |2887| | |2096|2887|
ISPAT | | | |1054| | | 859| |
MODI |1003| | | | | | | |
RELIANCE | 4| 7| 9| 220| 4| 4| 4| 33|
RPG | | | | 159| | | | |
SHYAM | | 401| | 401| 354| | | |
SPIC | | | | | | | | |
STERLITE | | | | | | | | |
TATA | | | | | | | | 435|
USHA | | | | | | | | |
UT | | | | | | | | 371|
VIDEOCON | | | | | | | | |
Bids for Group C Circles
AN AS BI HP JK NE OR
BHARTI | | | | | | | |
BIRLA | | | | | | | |
BPL | | | | | | | |
ESSAR | | | | | | | |
HFCL | | | | | | | 658|
ISPAT | | | | | | | |
MODI | | | | | | | |
RELIANCE | 0.1| 1.4| 4| 0.6| | 0.6| 3|
RPG | | | | | | | |
SHYAM | | | | | | | |
SPIC | | | | | | | |
STERLITE | | | | | | | |
TATA | | | | | | | |
USHA | 1| | 78| | | | 82|
UT | | | | | | | |
VIDEOCON | | | | | | | |
Major partners (for basic services)
RELIANCE Nynex (USA)
HFCL Bezeq (Israel), Shinawatra (Thailand)
ESSAR Bell Atlantic (USA)
ISPAT Hughes (USA)
RPG NTT, Itochu (Japan)
TATA Bell Canada
BPL US West (USA)
SHYAM PTT Guangdong (China), Havis
BIRLA Aditya Birla Group (India), AT&T (USA)
UT Jasmine
USHA Moscow Telecom
STERLITE Telecom Malaysia
BHARTI Stet
VIDEOCON Punwire (India), Deutsch Telecom (Germany)
SPIC Telstra (Australia)
MODI S K Modi Group (India), Telecom Asia
TELECOM CIRCLES - ABBREVIATIONS USED
TECHONOMIST COPYRIGHT NOTICE AND SUBSCRIPTION
(C) Copyright 1995 Deus X Machina, Rishab Aiyer Ghosh. ALL RIGHTS RESERVED.
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This article is from the Indian Techonomist (http://dxm.org/techonomist/), the newsletter on India's information industry. Annual subscription (monthly print edition plus e-mail bulletins) is for US$ 595 or equivalent. For information, contact Rishab Ghosh by e-mail at rishab@dxm.org, call +91 11 2454717 or post to A4/204 Ekta Apts, 9 I.P. Extn, New Delhi 110017, INDIA.