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Summary:

Qualcomm plans to bid for a chunk of spectrum in India’s upcoming 3G auction. Qualcomm doesn’t want to operate a network – nor does it want to deploy a 3G technology — it wants to jumpstart demand for 4G chips and provide better mobile broadband.

Qualcomm plans to bid for a chunk of spectrum in India’s upcoming 3G auction, the chipmaker said today. Qualcomm is taking a page out of Google’s playbook — the search engine giant bid for spectrum in the U.S. but never had any plans to become a network operator. The San Diego-based chip maker doesn’t really want to be a network operator nor does it want to deploy a 3G technology — it wants to jump-start demand for its 4G chips and meet India’s demand for mobile broadband. From its release:

“Qualcomm has a history of participating in spectrum auctions to expedite the commercialization of new wireless technologies. By participating in India’s BWA spectrum auction, Qualcomm can foster the accelerated deployment of TD-LTE.”

If the chip firm wins a chunk of spectrum in the 2.3 GHz band, it will want to promote TD-LTE, a version of the fourth-generation wireless standard that uses less total spectrum in deployment. Qualcomm is also making the bet that India will want to skip quickly from a 3G to a 4G service, a bet China Mobile is also making with its upcoming TD-LTE deployment.

Each generation of mobile broadband technology adds more capabilities for data, which we here in the U.S. are already consuming at a network-crushing pace. Bringing in LTE networks with more capacity will help with both speed and the total amount of data that can be transferred over the air. For cell-phone users in India, which has seen its 3G spectrum auctions delayed for years, there had been talk of skipping 3G and hopping right to 4G services that could handle current and future demand.

Qualcomm is also aiming to jump-start market demand for its chips in end devices in India and China (the two most populous countries), especially as its 3G royalties begin a decline in coming years. Qualcomm has to be worried by the increasing deployment of WiMAX-based services, which don’t really require the company’s technology and thus will fail to line its pockets.

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  1. Any ideas about the Indian government’s rules for allowing foreign companies to bid on its national spectrum?

    1. Previously, foreign companies with Indian partners have bid and won the auction.

    2. Foreign companies can apply to take part in the auction, but subsequently they will have to bring Indian minority shareholder(s) on board. India has a foreign ownership limit of 74% in telecom operators.

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