Spectrum auction of 46 mega hertz (MHz) in the 900 MHz band and 385 MHz in the 1800 MHz band kicked off on a positive note on Monday.
As per an official statement released, “Bids have been received in all 22 service areas in 1800 MHz band and in all three service areas in 900 MHz band. Thus, bidding has taken place in all the service areas in both bands.” Going by the data available by the day-end, Government received bids around Rs 23,479 crore for spectrum under 1800 MHz band in the 22 service areas. The three circles under the 900 MHz band generated bids close to Rs 16,685 crore by the end of the seven rounds of auction.
Eight telecom firms, including Bharti Airtel, Vodafone and Reliance Jio Infocomm, are in the fray in the auction from, which the Government expects to garner at least Rs 11,300 crore in the current financial year. The Department of Telecom (DoT) has put on the block about 385 MHz of radiowaves in the 1800 MHz band and 46 MHz in the 900 MHz band. Seven rounds of bidding took place on Monday and as per official sources, in the first few rounds more focus was on the 1800 MHz band.
As per sources, by the time third round of bidding had finished, companies bid excessively for spectrum in Delhi and Kolkata circles in the 900 MHz band and for 1800 MHz band, it included UP (West), UP (East), Gujarat and Bihar. The next round went complete to UP (West) and Gujarat circles in the 1800 MHz band while in the fifth round, demand for Bihar circle picked up. Mumbai and Kolkata circles for the 900 MHz band also shot up during the fifth round, sources added.
In the sixth round, telecom firms bided heavy for spectrum in all the three circles of the 900 MHz band. Experts had earlier said that after Reliance Jio jumped in the race to bid for spectrum in 900 MHZ, there would be fierce competition between Airtel and Vodafone, as they require spectrum as their licenses are going to expire in November 2014, and Reliance Jio.
This auction is of most importance to Bharti Airtel and Vodafone, especially after the Supreme Court refused to interfere with the order of the telecom tribunal dismissing the pleas of Bharti Airtel, Vodafone, loop and Idea for a stay on the spectrum auction and extension of their licenses by another 10 years.
The Government is conducting this third round of spectrum auction following a Supreme Court order in the 2G case directing that all radiowaves freed from the cancellation of 122 licences in February 2012 should be auctioned.
Earlier the 3G auction held in 2010 lasted for 34 days, while the offer in November 2012 lasted for two days and the sale in March last year was a big disappointment as only one player participated and it ended in just one day. In November 2012, Rs 9,407 crore of bids were received for spectrum worth Rs 28,000 that was offered. In March 2013, no GSM operators bid at the auction and only CDMA operator Sistema Shyam bought spectrum of about Rs 3,600 crore in eight of the 21 service areas.
Vodafone needs to get spectrum in Delhi, Mumbai and Kolkata; Airtel in Delhi and Mumbai, and loop Mobile in Mumbai to continue operations as their licences expire in November. The Government is hopeful that all the spectrum offered will be sold in the auction. The Government has set a target of Rs 40,874.50 crore for this fiscal from spectrum, including the auction amount, one-time spectrum charge and annual regular licence fee.