Why it's still good to be a govt cellco in India

13 Aug 2008

It was the week that saw spectrum head starts for India's state telcos, cash problems for NextWave, patent blues for SiRF and the kind of popularity that the iPhone could do without.

India's wireless broadband landscape took a major step forward during the week as the Ministry for Communications and Information Technology approved spectrum for both 3G and mobile Wimax - albeit whilst also giving government-owned companies a head start.

State-owned Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telecom Nigam Ltd (MTNL) each received single blocks of 2.1 GHz spectrum for 3G services in New Delhi and Mumbai. Both carriers also received one 20-MHz block of 2.5 GHz spectrum for Wimax services. The move means neither carrier has to go through the auction process to get spectrum, although they will have to pay the government an amount equal to the highest bid for spectrum from private players.

Meanwhile, on the Wimax side, there's still an additional block of 2.5-GHz spectrum up for grabs, as well as two 20 MHz blocks of spectrum in the 2.3 GHz bands. The Wimax Forum, which plans to add an Indian certification lab to its existing network by the end of 2008, is predictably pleased, and says that blocks in the 700 MHz and 3.3-3.6 GHz bands will be auctioned as they become available.

However, the week wasn't all good news for at least one Wimax player. NextWave Wireless said its cash is running out, sending the company's shares down to a 52-week low on Friday. Chairman and Chief Executive Allen Salmasi said the global economy was to blame. Either way, it adds up to a slowdown in wireless broadband equipment sales, and could herald the beginning of a Wimax vendor shakeout.

But where some seem doom, others see opportunity, and Proxim Wireless sees plenty of opportunity in Motorola's recently announced re-organization of its Home & Networks Mobility Group. During the week, Proxim announced an investment protection plan to all Motorola customers and resellers of Motorola equipment, extending preferential pricing to these groups if they move way from Motorola's Symbol, MeshNetworks, Canopy or Orthogon products and buy Proxim's WLAN, Wi-Fi mesh and point-to-point solutions

In other business news, Sierra Wireless purchased Junxion for an undisclosed amount. Junxion offers the Junxion Box that essentially creates a hotspot that allows users to remotely connect to Wi-Fi and share 3G connections. Sierra plans to incorporate Junxion with its mobile and machine-to-machine groups.

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