Idea Cellular, has successfully retained the crucial 900 MHz spectrum and won 54 MHz of 900 MHz Spectrum, out of overall win of 79.4 MHz Spectrum, for nine of its leadership Service Areas covering over 73% of the company’s revenues. The provisional results of the spectrum auction were announced by the DoT earlier.
Idea’s successful bid has helped it retain its spectrum in the 900 MHz band ensuring business continuity and customer service for over 106 million subscribers in these nine markets and related benefit for Idea’s overall subscriber base of over 155 million.
In this Spectrum Auction, Idea has also acquired additional spectrum in the 1800 MHz band in six key Service Areas, 2100 MHz in the strategic metro market of Kolkata, and additional 5 MHz on 900 MHz in Maharashtra for second carrier of 3G services. This will enable Idea to further expand its 3G Services to 13 circles covering 80% of its overall revenue and enable 4G roll out on 1800 MHz in 10 Service Areas covering 61% of Idea’s gross revenue.
The 9 MHz spectrum won in Maharashtra will enable Idea to deploy 3G services on 900 MHz (in addition to the existing 2100 MHz band), at an opportune time. Idea will therefore have 3G networks of 900 MHz band in Maharashtra and Delhi, which as per the Q3FY15 TRAI data are No.1 and No. 3 markets in India.
|Spectrum Band||Circle||Quantum of Spectrum Acquired (MHz)|
|900 MHz||Andhra Pradesh & Telengana||5.00|
|Madhya Pradesh & Chhattisgarh||7.40|
|Maharashtra & Goa||9.00|
Idea’s participation in the auction was necessitated due to the renewal of its licenses due in December 2015 /April 2016 across nine key markets namely Andhra Pradesh & Telengana, Gujarat, Haryana, Karnataka, Kerala, Madhya Pradesh & Chattisgarh, Maharashtra & Goa, Punjab and UP West, where it held the most efficient spectrum band of 900 MHz. These markets collectively represent nearly 70% of Idea’s subscriber base and contribute 73% of the company revenues. The spectrum win in these circles will ensure business continuity for another 20 years and help Idea strengthen its leadership in these markets.
With the acquisition of 79.40 MHz across three spectrum bands of 900, 1800 & 2100 MHz in the recent auction, Idea now has a total of 270.7 MHz of spectrum on a pan-India level.
Including this Auction and November 2012 Spectrum Auction, Idea has managed to acquire /renew new licenses with liberalized spectrum for 16 out of the 22 Service Areas, which is among the highest for any telecom operator. The company has next renewal of only four Service Areas in the Year 2021 and remaining two Service Areas as late as Year 2026.
The total spectrum bid made by Idea is valued at approximately Rs. 30,100 crores. The company will be availing of the deferred payment facility offered by the Government and likely to pay Rs. 7,732 crores as upfront payment, and the remaining amount in 10 equal annual instalments starting after a moratorium of 2 years.
With spectrum license renewal behind, the company will now return its focus on building the subscriber base, growing different steams of revenue and mobile data usage while providing a truly world class service to its 155 million customer base.