State-owned BSNL has set an ambitious target of starting next generation 3G mobile services in December to take a lead over private operators and has placed the purchase orders for the northern, eastern and western zones.

In a communication to all Chief General Managers of telecom circles or districts, BSNL has asked them to take further necessary actions at their end so that 3G services are launched by December, 2008.

While announcing the 3G policy, Communication and IT Minister A Raja had given the advantage to telecom PSUs BSNL and MTNL of allocating 3G spectrum ahead of others with a condition that both will pay the price equivalent to the highest bid.

This was done keeping in mind the cumbersome process to procure equipments by the PSUs vis--vis by the private players.

"The 3G Purchase Orders (POs) issued earlier by the circles of north and east zones were kept in abeyance because of non availability of 3G spectrum. As the 3G spectrum has now been allocated to BSNL, the 3G POs will become effective from the date of issuance of this letter (August 11, 2008)," BSNL said in the letter.

Whereas for the western and southern zones, the POs for 3G equipments has been placed with the ITI under reserve quota.

While releasing the radio frequency for the PSU, the Department of Telecom (DoT) has said that one time spectrum fee at a price equal to highest bid as determined in respective areas is payable by BSNL.

"Further, BSNL is also to pay annual spectrum usage charge of one per cent of Adjusted Gross Revenue (AGR) after a period of one year from the date of earmarking of frequencies that is August 8, 2008," BSNL said.