CDMA chipmaker Qualcomm which won broadband wireless spectrum (BWA) for four circles at Rs 4,912 crore is exiting the business. Since regulations bar sale of spectrum,Qualcomm will sell its company which acquired spectrum,in a move akin to Infotel Broadbands acquisition by Reliance Industries after the auctions. Qualcomm had decided to venture into the telecom services arena in India with its proprietary LTE-TD technology,a rival to WiMAX,promoted by Intel. However,the company intends to keep the LTE-LD flag flying even after its exit,insisting that a potential buyer use this technology. The San Diego,California-based Qualcomm has always been a technology company working with mobile operators and device manufacturers,but not entering direct services. Its participation in BWA auctions was the first step towards this. In a presentation to potential buyers,a copy of which is with FE,Qaualcomm says that it wants to sell 100% and is not interested in selling a minority stake. Since regulations cap foreign investment at 74%,Qaulcomm had divested 26% stake to GTL Infrastructure and Tulip Telecom for Rs 268 crore. In response to a number of inquiries Qualcom has received from various Indian wireless operators regarding the sale of Qualcomm's BWA spectrum,Qualcomm has prepared the outline of the terms and conditions under which it would be prepared to sell such spectrum, the company said. The company now plans to divide its arm which won the spectrum into four separate companies,or alternatively,into two,to make a complete exit. Qualcomm is looking at garnering a minimum of Rs 4,912 crore it paid for the spectrum and an undertaking that the buyer would use LTE-TD. Qualcomm has BWA spectrum for Mumbai,Kerala,Delhi and Haryana. If it sells in two blocks,one company would comprise of the Mumbai and Kerala and the other Delhi and Haryana. A Qualcomm spokesperson said that the company's stated position is to work with 3G and BWA operators and promote LTE-TD technology and then exit its India LTE venture. However,it cannot comment on details. Analysts said that since the regulations do not permit spectrum sale,if Qualcomm wants to get out of operations it has no option but sell off the company. The government has not put any lock-in clause on the winners of either 3G and BWA spectrum. Immediately after the auctions,Infotel which was the only company to acquire spectrum in all circles was acquired by RIL.
