NEW DELHI, INDIA: The wait for next generation telephony is finally over with an empowered group of ministers Thursday fixing the base price of third generation (3G) radio waves at Rs..3,500 crore. It had been earlier pegged at Rs..4,040 crore.

The ministerial group also fixed Rs..1,750 crore as the base price for pan-India WiMax or wireless Internet spectrum.

While the Finance Ministry had earlier suggested Rs 4,040 crore for 3G and Rs. 2,020 crore for WiMax, the Department of Telecom had worked out it to be fixed at Rs. 2020 crore and Rs. 1010 crore respectively. Hence the base price for 3G auction had been a major bone of contention between the DoT and the Finance Ministry.

The government is hopeful of completing the spectrum auction within 90 days of the announcement of the base price and of earning about Rs.25,000 crore from the auction of 3G and WiMax spectrums.

"We welcome the government's decision to expeditiously complete the planned auction of 3G spectrum," said Manoj Kohli, chief executive and joint managing director Bharti Airtel.

"We believe 3G will drive the wireless broadband revolution in both urban and rural India, contributing to inclusive growth. Bharti Airtel looks forward to participating in the auction."

The mandate of the empowered group, which was set up under Finance Minister Pranab Mukherjee and includes Raja, was to fix the base price for the spectrum auction and the number of operators to be allowed in each telecom circle for offering 3G services.

However, the apex body of GSM telecom operators - Cellular Operators Association of India (COAI) - is not happy with the pricing and called it "exorbitant".

"The price is too high for 3G," T.V Ramachandran told IANS.

Asked if the industry would oppose the pricing, he said: "We would not oppose it. But what has been decided is unfair."

The ministerial group has decided to auction only five slots in the 3G spectrum, with one slot already allotted to state-run telecom operators Bharat Sanchar Nigam and Mahanagar Telephone Nigam.

Raja said with only four slots being auctioned among private players, the bids are likely to go higher than estimated, yielding additional revenues as a result.

For WiMax, only three slots will be sold, he told reporters.

The ministerial group lowered the base price to Rs..3,500 crore for 3G spectrum, from the earlier level of Rs..4,040 crore decided upon informally by Raja and Mukherjee, following representations from industry.

The telecom ministry will now announce the detailed programme for the auction, which will include pre-bid conference in the next few weeks.

Third generation telephony services allow faster connectivity than what is available now, and will enable applications like Internet TV, video-on-demand, audio-video calls and high-speed data exchange.

Apart from Mukherjee and Raja, the other members of the ministerial group are Defence Minister A.K. Antony, Home Minister P. Chidambaram, Agriculture Minister Sharad Pawar, Information and Broadcasting Minister Ambika Soni, Law Minister M. Veerappa Moily and Planning Commission Deputy Chairman Montek Singh Ahluwalia.

©IANS