I am in Singapore right now, and one of the big telecommunications topics is the India 3G license auction. The bidding is apparently close to coming to an end and once it ends, the winning companies will get to spend what they bid, for the right to utilize the license(s) they won. According to the Merriam-Webster dictionary, one definition of spent is also "drained of energy or effectiveness." And after all the spending going on with regards to India and the 3G license auction, one has to wonder about the ability of the operators to actually deploy the infrastructure within a decent amount of time, mainly because the infrastructure causes more money over and above the license.
If you go to http://dot.gov.in, you will see the state sponsored website regarding the status of the auction. As of May 16th, a company winning a license in each of the 22 zones would pay 15815 crores or $3.5 billion if I read the tables right and did the math right. Remember there are multiples licenses to be awarded.
Are these bids realistically priced or not? Well, India is one of the largest mobile subscriber markets in the world. If a company wants to "win" in India, it has to have a 3G license. And as I wrote about 6 weeks ago, with huge subscriber growth per month in India, the 3G networks also will play a key role in simply having bandwidth available for subscriber growth. So the 2G networks will play a key role for some time, likely for the lower ARPU customer base. And the 3G networks, as we know, will play a critical role in the higher ARPU mobile data and video services that can come with them.
I will be in India for VAS Asia 2010 in July and I will report back on what's going on there. Should be interesting.
