In a win-win situation for both the BSNL and Soma, the state-owned PSU has entered an agreement with Soma Networks for providing WiMAX services. BSNL will not make any investment on this new unproven technology. Soma will install network and offer services on a revenue share basis. The field is open for other WiMAX providers as BSNL has non-exclusive arrangement with Soma.

As per the deal SOMA will roll out mobile WiMax across three States — Gujarat, Maharashtra and Andhra Pradesh — to provide wireless broadband coverage to nearly 200 million people over the next 3 years.

Prior to this, the largest mobile WiMax project was the one announced by Sprint-Nextel, aimed at providing coverage to 100 million people in the US. This will be the first deployment of mobile WiMax version based on standard 802.16e in India.

Sprint-Nextel, however, selected big vendors with end-to-end in-house capability (Motorola, Samsung and NSN) for its project, which initially aimed to cover 100 million people by the end of 2008.

For this project, SOMA will have to manufacture, deploy and install thousands of base stations. Being a small player, SOMA will need to significantly ramp up its capabilities, both in terms of manufacturing and professional services, in a relatively short period of time. The size of the deal also implies challenges to SOMA''s Taiwanese ODM partners for CPEs, especially when considering that price points in India have to be as low as possible.