Reliance plans $500m 3G tender, abandons CDMA for 3G?

According to a report in the Economic Times of India, a decision to issue the tender was made over the weekend in RCOM following the government’s unveiling of its 3G licensing guidelines.

The government announced last Friday that it will auction 3G licences, which include spectrum in the 2.1 GHz band, in the coming months.

“The tender covers equipment supply and servicing for commissioning of the 3G network,” an unnamed source told the paper. “The leading global vendors who are in preliminary talks with RCOM for the 3G deal include Huawei, Alcatel Lucent, Nokia Siemens Networks, ZTE and Ericsson.” The tender document is expected to be sent to the vendors in the next three or four days.

Despite RCOM’s success with its CDMA offering, the new 3G infrastructure is expected to be rolled out over RCOM’s GSM infrastructure. RCOM currently offers GSM services in eight circles but is rolling out a nationwide GSM network after it won the rights to offer pan-India GSM services in December.

The company has said it plans to spend some $6 billion in rolling out its pan-India GSM network for its fiscal year ending March 2009. In January, it awarded a US$600 million contract to Huawei to roll out a nationwide GSM network.

RCOM currently has 43 million CDMA subscribers and eight million GSM subscribers.

DELHI GSM LAUNCH: At the same time, Reliance announced that it will expand its GSM service to the city of Delhi, which is the first circle beyond the operator’s original eight circles. The operator said it is testing the network out with 1,000 employees and plans to launch commercial services when the trial run is completed.

Similarly, company sources told the Economic Times that the operator is readying commercial GSM launches across the country as soon as the network is ready.