Business
India's spectrum auction elicits Rs.60,000 crore in six rounds on Day One
New Delhi, March 4
A total of six rounds of
bidding took place on Day One of the auctions of radio frequency
spectrum, or airwaves, for telecom operators with a total offer for
Rs.60,000 crore, sources said on Wednesday.
"We have received
bids in all bands. There was some good bidding in the 800 MHz and 1,800
MHz bands, whereas 2,100 MHz is yet see some traction. Auction will
continue tomorrow (Thursday)," a source said.
The bid amount is already 50 percent more than what the government had budgeted for.
The
total spectrum put to auction is 103.75 MHz in 800 MHz band, 177.8 MHz
in 900 MHz band and 99.2 MHz in 1,800 MHz band for second generation
(2G) telephony.
The government has also put up 5 MHz in the 2,100 MHz band third generation (3G) telephony.
The
eight telecom service providers participating in the auctions are --
Reliance Communications, Reliance Jio, Bharti Airtel, Vodafone India,
Tata Teleservices, Uninor, Idea Cellular and Aircel.
They have together submitted earnest money of Rs.20,435 crore, which is two-and-a-half times what had been called for.
The
Department of Telecom (DoT) has selected Kolkata-based mjunction
services -- an information technology and internet company promoted 14
years ago as a 50:50 venture by Steel Authority of India Ltd and TATA
Steel -- for conducting the spectrum auction.
The auction is taking place from 9 a.m. to 7.30 p.m. Monday to Saturday.
The
matter of auction was under litigation even before it started. But the
Supreme Court has permitted the government to go ahead with the process
from March 4 but await its directions before finalisation of the bids.
The
reserve price approved is Rs.3,646 crore pan-India per MhZ in 800 MHz,
Rs.3,980 crore for 900 MHz band pan-India, and Rs.2,191 crore pan-India
in 1,800 MHz band. The government also approved a reserve price of
Rs.3,705 crore per megahertz for 3G spectrum.
As per estimates,
at the base price alone, the auction will translate into some Rs.82,000
crore, even as the actual process is estimated to fetch around
Rs.100,000 crore.
In December 2015, seven licences each of Idea
Cellular and Reliance Communications, four licences of Bharti Airtel and
six licences of Vodafone will complete their 20-year term after which
they have to be renewed. In total, there are 29 licences in 18 service
areas which expire in 2015-16.
The bidding process is using fixed internet protocols for the e-auction as dynamic IP addresses are not allowed.
The
objectives is to obtain a market-determined price of spectrum in the
bands through a transparent process, ensure efficient use of spectrum
and avoid hoarding, stimulate competition in the sector, promote rollout
of the respective services and maximise revenue proceeds from the
auctions within the set parameters, officials said.
The 2010
auctions took 34 days and 183 rounds of bidding. The one in 2012 lasted
two days while a year later, it took just over four hours, but these
were smaller ones. In 2014, it took place over 10 days with 68 rounds.
After
10 days of aggressive bidding by telecom service providers, the
government had garnered an Rs.61,162.22 crore from the auction of
900-MHz and 1,800-MHz spectrum in last year's auction.