Tata Teleservices to gradually shut down CDMA network, writes off its equipment value: Report

By July 5th, 2016 AT 2:16 PM

Tata Teleservices Limited (TTSL) is reportedly shutting down its CDMA operations running on the 850 Mhz band across all 22 circles, even as telecom licenses for several circles such as Mumbai, Andhra Pradesh and Maharashtra are due for renewal in September 2017, according to an Economic Times report.

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TTSL’s airwaves across all 22 circles in the band can’t be used for 4G as they weren’t bought in auctions, the report said, adding that the telco is also writing off its equipment value.

The report added that the ailing telco may look to buy some 850 Mhz band spectrum in the three circles of Andhra Pradesh, Mumbai and Maharashtra – where its permits are up for renewal in the upcoming sale – plus some in the 1800 Mhz band, sources said. The telecom operator is may have a coffer of around Rs 7,000 crore for the upcoming spectrum auction to acquire airwaves in both these bands, which can be used for 4G services.

The upcoming auctions are scheduled for early September. The Tata group recently approved investment of Rs 3,000 crore in Tata Teleservices at a board meeting held on June 25.

Even as the company may look at acquiring airwaves in the forthcoming auctions, it is unlikely to be too aggressive in the market,” according to a person privy to the matter, who told ET that the company doesn’t want to stay invested in the business for the long term.

TTSL, however, informed the publication that it’s too premature to talk about shutting off any specific service at this juncture.

“Telecom licenses for several circles such as Mumbai, Andhra Pradesh and Maharashtra are due for renewal in September 2017. Tata Teleservices Ltd and Tata Teleservices (Maharashtra) Ltd will evaluate their options on technologies based on various factors including the outcome of the spectrum auction to be held shortly,” it said in a statement.

In the quarter that ended on March 31, Tata Teleservices Maharashtra, listed on stock exchanges, running Mumbai and Maharashtra service areas for Tata Teleservices, reported Rs 29 crore loss as a “provision for impairment of CDMA fixed assets” given that the license is expiring in September 2017. The statement indicated the withdrawal of CDMA services.

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