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Bharti Airtel has floated a request for proposal for buying telecom equipment for upgrading its third generation mobile network.
The company has specified in the tender document that it wants to buy gear that can operate in both 2100 MHz band and 900 MHz band.
The operator’s network is currently managed by different vendors including Ericsson, Nokia Solutions and Huawei. Though Airtel has not specified the size of the project, suppliers can look forward to a multi-million dollar deal.
Two counts
The new RFP is significant on two counts. First, this indicates that telecom companies are back to investing big money in rolling out networks. For the last two years, there has been no major procurement of telecom equipment in the country owing to the market slowing down. Recently, Vodafone also announced that it will invest Rs 7,000 crore in upgrading its network. This could trigger other telecom companies to start investing in network, which is good news for consumers. Secondly, the tender condition indicates that Airtel is gearing up to fight it out to retain the 900 MHz spectrum band and use it for 3G services. At present, this frequency band is being used by operators to offer 2G voice service. For 3G services, telecom companies are using only the 2100 MHz band.
But operators, including Airtel, which currently own spectrum in 900 MHz band, have to surrender it back to the Government under a new policy. This will be re-auctioned so that all operators have an equal chance of buying it.
Due to laws governing mobile transmission, 900 MHz band is considered to be superior for data services compared with 2100 MHz. Airtel currently has 3G spectrum in the 2100 MHz band in 13 circles but it could buy more spectrum in the other areas in the next round of auction.
Nextgen networks
When contacted an Airtel spokesperson declined to comment. But market watchers said that since telecom operators have clear plans to use 900 MHz for deploying next generation networks, the Government must ensure that spectrum is priced right. Already there is a war of words between the Government and the opposition party BJP on this issue.
While the Department of Telecom, backed by the recommendations of the telecom regulator, has proposed to lower the reserve price of spectrum from the previous round of auction, BJP leader Yashwant Sinha had alleged that such a move is intended only for the benefit of a few incumbent telecom operators.
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