The smaller package, worth more than $100 million, is for the network switching system. Some 11 consortiums are bidding for the contract, with each group containing a local company registered with the Information & Communications Technology (ICT) Ministry as a general contractor and a foreign equipment supplier. The six foreign companies working with the local consortiums are Huawei Technologies and ZTE, both of China, France's Alcatel, Sweden's Ericsson, Finland's Nokia and Germany's Siemens. An estimated $50 million software package associated with the switching system will be supplied by local companies through direct negotiations, rather than tender.

International suppliers are also bidding with local consortiums for the second package, comprising the base switching system. The package has been split into six regions - Tehran, Tabriz, Hamadan, Mashad, Isfahan and Shiraz. According to Irancell chairman Ebrahim Mahmoudzadeh, it has not been decided whether companies will be able to work on more than one region. Work in each region is expected to be worth $70 million-80 million. Irancell was formally awarded the second operator's licence in November after almost two years of negotiations. The company is a consortium of South Africa's MTN and Iran Electronic Industries (IEI), itself a partnership between the Defence Industries subsidiary Sa Iran and Mostazafan & Janbazan Foundation. MTN replaced Turkcell as the 49 per cent foreign partner after negotiations failed.