Idea Cellular has signed a pact with Videocon Telecommunication to buy out its spectrum in Gujarat and Uttar Pradesh West Circles. The deal stands at Rs 3310 crore, for a quantum of 2×5 MHz contiguous blocks of 1800 MHz in each service areas, with a right to use spectrum until December 2032.
The spectrum will help Idea deploy 4G (LTE) services in these areas. According to reports, Idea will also take over the outstanding ‘deferred payment liability’ of Videocon Telecommunications payable to the DoT.
The payments are for the spectrum being acquired for service areas of Gujarat and Uttar Pradesh (West) in the November 2012 auction.
MD of Idea Cellular Himanshu Kapania said that the by the first half of 2016, the company will launch its 4G based services in 750 towns and by acquiring this spectrum, it will be in a position to add more cities for the launch. The deal will help Idea in increasing its 4G footprint in 12 key circles. This will contribute 62 per cent of its revenue, and touch 170 million customers.
The upcoming launch of Relaince Jio’s 4G services has stepped up the competition in the Indian telecom industry, with players like Idea upgrading their networks and offering 4G services to their customers.