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Global Economics

India's BSNL to Launch 3G by Next June

State-run Bharat Sanchar Nigam expects to receive Ericsson equipment by the end of the year and roll out the new service six months later

State-run telecom major Bharat Sanchar Nigam Ltd (BSNL) hopes to roll out its third generation (3G) mobile services by June next year, using the technology of Sweden's Ericsson, a top company official has said.

"We hope to receive the equipment from Ericsson from December. It will take some six months to roll out the services. We will earmark around 10 million lines for the initial launch," the official, who did not wish to be identified, said.

He was referring to the tender for 45 million lines worth $1.75 billion floated two years ago, where Ericsson was given 60 per cent of the order—and out of that, 10 million have now been earmarked for the 3G service.

The 3G service not only allows much faster communications but also a wide range of applications such as high-speed net access, video calls, fast music and video downloads, interactive gaming and global positioning over internet.

The official said BSNL also proposed to open another mega tender for 90 million lines worth some $9 billion by the end of this month. Of this, 50 per cent of the lines would be set aside for 3G telephony, he said.

"But we will have a mid-term assessment of the roll-out since we are still not sure about the potential of 3G in the country. It is an expensive service and we have to understand how much demand there will be."

Communications Minister A Raja had August 1 announced the much-awaited guidelines for the auction of spectrum, or airwaves, to launch third-generation (3G) mobile phone services in the country.

State-run Mahanagar Telephone Nigam Ltd (MTNL) that provides telecom services in Delhi and Mumbai, and BSNL, which caters to the rest of the country, need not bid for spectrum allocation, but have to pay the highest price, he said.

BSNL officials, however, said that the perception that the state-run companies will get a head start of three-four months over private players due to the government norms was misplaced.

"The procedures we have to follow for buying technology or equipment are time-consuming because we are a state-run company. So whatever time we have in hand will be taken away by that," a BSNL official said.

"Besides, we have to pay the same amount for spectrum which the private player will be required to. So, it is not as though we have been given the licence and the airwaves on a platter," he added.

As in June this year, BSNL had 41.96 million wireless subscribers and 30.866 million wireline subscribers all across the country, excluding the two major metros of Mumbai and Delhi.

The state-run company has set aside a capital expenditure of Rs 16,000 crore for the current fiscal.

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