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Telcos Place Bids Worth Rs 77,000 Crores for 4G Spectrum

Telecom operators on Monday placed bids worth Rs 77,146 crore in India’s first 4G spectrum auction in more than four years against the government’s expectation of 45,000 crore, communications, electronics, and information technology minister Ravi Shankar Prasad said. The department of telecommunications (DoT) aims to raise at least Rs 3.92 trillion in the auction of 2,308.8 MHz of spectrum. The auction will continue on Tuesday, the minister told reporters.
All three telecom operators, Reliance Jio Infocomm Ltd, Bharti Airtel Ltd, and Vodafone Idea Ltd, which submitted earnest money deposits took part in the auction. The minister said bids were received for radio airwaves in the 800 MHz, 900 MHz, 1,800 MHz, 2,100 MHz, and 2,300 MHz bands. Spectrum in the 700 MHz and 2,500 MHz bands remained unsold on day one.
“Bidding will continue in the first half tomorrow (Tuesday)… There were three bidders in today’s auction versus seven players in the 2016 auction. Of the total spectrum put up for sale, bids of Rs 77,146 crore were received,” Prasad said.
“Telecom operators seem to have bid marginally higher than I expected. However, it is still a fraction of the total spectrum put up for sale. In the case of the 700 MHz band, telcos clearly found its high reserve price a deterrent. This (700 MHz) is a valuable spectrum and if it doesn’t get sold, the government may be forced to lower the prices. The players can afford to wait it seems,” said Mahesh Uppal, a senior telecom expert. Jio has bid for 800 MHz spectrum which will expire in many circles, and high interest in the 2,300 MHz bands, which is predominantly used for 4G in India, indicates that telcos are looking to improve their coverage and service quality, said Uppal.
The government received bids for 89 per cent of the 2300 MHz band, while 65 per cent of the 800 MHz spectrum was taken. Airwaves in the 900 MHz, 1,800 MHz and 2,100 MHz saw 38 per cent, 41 per cent and 9 per cent bids, respectively.
The minister indicated that the 700 MHz band, which has remained unsold so far, could be used for 5G auction. According to experts, the spectrum in the 700 MHz bands can support 5G because of its efficiency, which also makes it the most expensive among those put under the hammer.
“The legal process is that once the price of a spectrum band is put on auction, we will have to go to Trai (Telecom Regulatory Authority of India) for reconsideration of fresh price,” Prasad said.

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