India's Sistema Shyam wins spectrum in eight circles

Indian CDMA operator Sistema Shyam TeleServices has announced that it has won 800Mhz spectrum in eight of the country’s circles. The operator was the only company to bid for 800MHz spectrum and has paid INR3,639 crores ($680m) for its licences, which are technology neutral and will be valid for 20 years.

The operator, also known as MTS India is the joint venture run by Russian operator Sistema and the Shyam Group of India.

The move has resulted in an overall decrease in the operator’s footprint in India. In February 2013, the operator shut down its operations in ten of the country’s telecom circles, claiming the decision was made based on “several factors” including spectrum pricing and the levels of competition in those markets.It also had 21 licences cancelled in February 2012, when India’s Supreme Court revoked all licences allocated in the initial 2G auction in 2008, due to allegations of corruption.

The company said that while bidding for spectrum this time around, it considered a range of variables including spectrum pricing, number of carrier slots available, levels of competition and future data potential in the circles. Based on its criteria, MTS India decided not to bid for spectrum in Mumbai, Maharashtra and UP East circles, the operator admitted. Its customers in those three circles must now switch carriers, the firm said.

The Circles won by MTS India include Delhi, Kolkata, Gujarat, Karnataka, Tamil Nadu, Kerala, Uttar Pradesh (West) and West Bengal. The company will also continue operating in Rajasthan, which was not affected by the February 2012 Supreme Court order.

“Given the range of variables we have considered and the spectrum cost for 800Mhz, it was a big challenge to arrive at a core list of eight circles and to bid accordingly,” said Vsevolod Rozanov, president and CEO at Sistema Shyam TeleServices.

“With the Rajasthan circle also a part of MTS India’s footprint, we would be able to service 40 per cent of the country’s population, address over 60 per cent of data business potential, safeguard 75 per cent of our current revenues and significantly optimise our losses. Our go forward plan includes building an even stronger MTS brand in the country by focusing on our data centric-voice enabled strategy.”