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Airtel Buys 100% In Qualcomm’s 4G Business In India

Bharti Airtel now has spectrum to launch 4G services in four more circles, and more importantly, in the key cities of Mumbai and Delhi, as well as the states of Haryana and Kerala, following the acquisition of 100% stake in Qualcomm’s broadband wireless entity in India – Wireless Business Services Private Limited – for an amount that is, as yet, undisclosed. Airtel now is in a position to offer 4G services in Delhi, Haryana, Karnataka, Kerala, Kolkata, Maharashtra, Mumbai and Punjab.

However, even with spectrum in four circles prior to this acquisition, Airtel has launched 4G services only in Bangalore, Kolkata, Pune, Chandigarh, Panchkula and Mohali. In May 2012, Airtel had made an initial investment of approximately $165 million (Rs 927.39 crore approx) to acquire 49% in Qualcomm’s India entities. It bought 2% more a couple of months ago, thus giving it a majority stake.

Do check out our coverage of the 4G auction results in 2010, which will give you an indication of who else has 4G spectrum which they are currently doing nothing with.

Airtel’s 4G services don’t appear to be doing particularly well either: the company had to reduce prices, but, apparently capped speeds to 10mbps. Airtel is also the company that capped download speeds for its broadband customers with an unfair “Fair Usage Policy”.

A timeline of Qualcomm’s 4G initiatives in India:

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June 2010: Qualcomm had won BWA spectrum in four circles including Delhi, Mumbai, Kerala and Haryana for Rs. 4912.54 crore, with Mumbai being the costliest circle for the company at Rs 2292.95 crore.

July 2010: Qualcomm brought in India-based Tulip Telecom and Global Holdings as its LTE rollout partners for $28 million since foreign companies are allowed to own a maximum of 26% in telecom ventures in India. Qualcomm applied for an ISP license to offer Internet services with four partner companies namely Wireless Broadband Business Services (Delhi), Wireless Broadband Business Services, Wireless Broadband Services (Kerala) and Wireless Broadband Business Services (Haryana).

December 2010: Qualcomm along with Ericsson had demonstrated LTE TDD at 2.3 GHz in Gurgaon, India. The demo live streamed multiple high definition video feeds to a mobile van in Gurgaon, using Qualcomm chip-set based USB dongles.

Jan 2011: India’s Foreign Investment Promotion Board (FIPB) had approved Qualcomm’s proposal to invest up to Rs. 796.9 Crore in its Indian Broadband Wireless Access venture, enabling the company to roll out Broadband Wireless Access services in four circles in India, in partnership with telecom operators.

September 2011: DoT rejected Qualcomm’s bid for a license to offer Internet services stating that Qualcomm’s bid came in December, after the  the deadline for inviting the bids had expired and three months after DOT had issued letter of intent to Qualcomm. It also noted that Qualcomm had nominated four different ISP companies instead of one, in order to get a Category-A ISP license, which did not comply with the NIA rules mentioned in the letter of intent.

Following the bid rejection, Qualcomm had claimed that it had complied with the application process and the grounds for rejecting its application were baseless since its locally incorporated partner companies had sent their bids in August. Qualcomm informed that DoT had asked for a clarification from the company in November, after the 90 day window period had expired, to which it had replied in December.

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October 2011: Qualcomm made some key management changes and was successful in getting a stay from the Telecom Dispute Settlement Appellate Tribunal (TDSAT), on the Department of Telecom’s decision of rejecting its bid.

February 2012: TDSAT had directed DoT to issue the ISP licence and allot spectrum to Qualcomm, within a week of the company paying dues amounting to Rs 410 crore, to its Indian partner, Tulip Telecom.

March 2012: After an 18-month delay, DoT had issued an Internet Service Provider (ISP) license to Qualcomm.

May 2012: DoT allotted BWA spectrum to Qualcomm enabling the company to offer wireless broadband services in the country.

May 2012: Bharti Airtel 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.

Sep 2012: CCI approves merger of Qualcomm’s four BWA businesses into a single entity – Wireless Business Services Private Limited

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July 2012: Airtel Increases Stake In Qualcomm’s Indian 4G Biz To 51%

Written By

Founder @ MediaNama. TED Fellow. Asia21 Fellow @ Asia Society. Co-founder SaveTheInternet.in and Internet Freedom Foundation. Advisory board @ CyberBRICS

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

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