Virgin Mobile, Spice Group bid for 3G franchise deal of MTNL

BK Modi-promoted Spice Group and British Virgin Mobile have bid for MTNL's franchise deals to offer 3G services in Mumbai and Delhi.

"Virgin Mobile and Spice Group have bid for our 3G franchise deal. We will finalise the bidder(s) in a month," Kuldip Singh, director (technical), MTNL told PTI.

Spice Group, which had sold off its mobile services business to Idea Cellular, has business interests in telecom, mobile software and retail stores.

Virgin Mobile, on other hand, is owned by Virgin Group of the UK. It already has a franchise agreement in India with Tata Teleservices for providing telecom services under the Virgin Mobile brand to the youth segment.

MTNL had invited bids in July for a franchise deal to sell its 3G mobile services on a revenue-sharing basis.  MTNL is seeking a partner with the expertise to help it kick start its 3G deployments before competitors in private sector, like Bharti Airtel and Vodafone Essar, can enter the fray.

The government has announced the spectrum auction base price and the auction is likely to take place soon. This involves sharing of cost, risk and reward, with the partner bringing expertise and equipment funding to the table.