Biggest sale of telecom spectrum to happen in August this year: Report

India’s next spectrum auction could happen in early August instead of mid-July as suggested by the telecom secretary JS Deepak, according to a Business Line report, which also said that the Cabinet is likely to take a final decision this week on the pricing and timing of the next round of spectrum auctions.

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Ravi Shankar Prasad last month told media that issues regarding spectrum have been addressed, in the coming two to three months, and 2,000 MHz of spectrum will be auctioned. The report added that the Cabinet may clear the pricing of various frequency bands and the related spectrum usage charge as per the recommendations of the Telecom Commission.

The Telecom Commission (TC), in its latest meeting, had proposed a lower, 3% spectrum usage charge (SUC), from the operators’ adjusted gross revenue for all bands. The Telecom Commission’s decision said that the SUC will be calculated using a weighted average formula based on the total spectrum holding. However, the proposal will be limited only to the upcoming auction.

The cabinet will also take a final decision on the 3 percent lower spectrum usage charge (SUC) proposal.

The Indian government is looking to fetch a whopping Rs 5.36 lakh crore from the auction, which will be the biggest-ever auction in terms of value and is more than double the gross revenue of telecom services industry. The major bands include 700MHz and 2500MHz, which will be auctioned for the first time. Other bands include 900MHz, 1800MHz, 2100MHz and 2300MHz.

The telecom regulator, Trai had recommended Rs 11,485 crore reserve price per unit for 700 MHz band, which has been termed as “steep” by incumbent telcos like Airtel and Vodafone. It is likely that these telcos will refrain from purchasing spectrum in the 700MHz band.

The airwaves in this band are considered the most efficient and stable to offer high-speed data 4G services.

The Defence Ministry is also handing over spectrum in the 2100 (3G) and 1800 MHz bands, requested by the telecom department. Under the swap agreement between the telecom department and the Defence, 15 MHz of 3G spectrum in each of the 22 telecom circles and 201 MHz of spectrum in the 1800 MHz band will become available for mobile services.

This spectrum will be put up for sales for telecom companies, who can look at acquiring it to achieve a pan-India 3G network. At base price, the value of spectrum has been kept at ?30,000 crore.

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17 Comments on "Biggest sale of telecom spectrum to happen in August this year: Report"

 

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Ansari
June 22, 2016 5:45 am 5:45 AM

Another tarrif hike in waiting !!!! A way to tax more to the already crying public.

Govt to become richer, telecom companies to struggle with their finances, public to shell out more.. YET NO NETWORK AND MORE CALL DROPS.

Sudhakar
June 23, 2016 9:39 pm 9:39 PM

So the data tariff per GB with 30 days validity will cross Rs.500 before 2020. Tech slum india.

prem
June 22, 2016 5:02 pm 5:02 PM

yeah..right..jio should not bid for 700 mhz..850 mhz is enough for coverage..instead they should increase capacity by topping 850,1800 n 2300 mhz spectrum..they can also bid for 2500 mhz which can be used for small cells or backhaul purposes

Akhilesh Kr Shukla
June 21, 2016 11:13 pm 11:13 PM

jio already covered max aria (pan India) using 850….
which operators going Invest more than jio using 700 (which only 10-15% better coverage with same speed which is 2-10mbps) ….

Saket Kewate
June 21, 2016 8:31 pm 8:31 PM
Vodafone will surely go for 700mhz. Reasons 1) very minimum 3g spectrum/circle 2) poorest rural coverage, with 700mhz and low Capex it can reach wide areas. 3) Has to maintain top 2 slot and don’t want to loose to Rjio or (Rcom+aircel +mts) 4)Have full bag ready with cash 5)Rural customer will be happy with wide coverage and average speed of 4-5mbps,, so fear of loosing to other 3G/4G operator is minimize. Next Customers to 700 mhz is Telenor. Last in line From Bottom 1)Rjio 2)Airtel 3)Rcom 4)bsnl. So possible out of 22 circle we may see only2-3 circle will… Read more »
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