Tikona Digital Networks will be investing $200 million or Rs 1,100 crore to buy 4G network gear, according to a report by The Economic Times. The company has floated a request for proposals (RFP), inviting bids for 4G equipment, as per the report.
Tikona, which has 4G licences in five circles including Gujarat, Rajasthan, Uttar Pradesh-East, Uttar Pradesh-West and Himachal Pradesh, will invest about $40 million in each of its five circle to roll out 4G services. Initially, it plans to roll out its 4G network in Gujarat and Rajasthan region. Tikona won 4G license for these circles in the 2010 BWA auction for which it spent Rs. 1,058 crore. However, Nokia-Siemens and Ericsson, possible vendors for 4G network gear, refused to comment on the story.
Currently, Tikona offers Wi-Fi data connectivity to home consumers and small enterprises. For 4G, Tikona has grand plans of integrating its 4G and WiFi service. The company plans to provide combined service which will offer data connectivity through existing Wi-Fi networks indoors and offer its LTE service outdoors.
Tikona Digital Networks, founded by Prakash Bajpai, has been funded by Goldman Sachs, Oak Investment Partners and Everstone Capital Advisors own 71% in the company.
Current status of 4G services in India
RIL hasn’t revealed its 4G service rollout strategy yet, and it’s been almost close to two years that the company acquired pan-India BWA spectrum through the acquisition of Infotel Broadband, which had won BWA spectrum in all 22 circles in the country for Rs 12,847.77 crore during the 2010 BWA auctions.
Bharti Airtel had BWA licenses in four circles – Kolkata, Karnataka, Punjab and Maharashtra, and has already launched 4G services in Kolkata and Karnataka circles. Apart from that, Airtel also recently signed an agreement with Qualcomm, under which, it has made an initial investment of approximately $165 million (Rs 927.39 crore approx) to acquire 49% interest in Qualcomm’s India entities that hold BWA/4G licenses in Delhi, Mumbai, Haryana and Kerala.
Neither BSNL not MTNL has launched its 4G service yet. BSNL has been reporting losses for the last three years. The operator was also looking to surrender its BWA spectrum and had received the Department of Telecommunications (DoT)’s nod in December 2011. BSNL had paid Rs 8,313.80 crore to acquire spectrum in 17 circles. Although DoT has accepted BSNL’s request, the company will receive a refund only when the spectrum is put on auction.