Telecom regulator TRAI on Wednesday suggested a base price or auction starting price of Rs2,720 crore per megahertz for sale of pan-India 3G mobile spectrum in February, about 19 per cent lower than what operators paid in 2010.
The 3G spectrum in 2010 had attracted bids worth Rs16,750.58 crore for a block of 5 Mhz frequencies on pan-India basis which amounts to about Rs3,350 crore per Mhz. The recommended base price is about four times higher on per megahertz basis when compared to reserve price of Rs3,500 crore for 5 Mhz fixed by the Government for last 3G auction. Besides, the Telecom Regulatory Authority of India has recommended that DoT should put additional 15 Mhz for auction, which has to be obtained in exchange of spectrum that is with the Defence services.
The Department of Telecom, however, is optimistic of getting 5 Mhz of 3G spectrum (2100 Mhz band) from the Defence Ministry. "The Authority recommends that the reserve price for 2100 MHz spectrum in each lSA (licence service area) should be Rs2,720 crore," TRAI said. "Furthermore, the 15 MHz of spectrum in the 2100 MHz spectrum being vacated by Ministry of Defence, in lieu of spectrum in the 1900 MHz spectrum, should be auctioned in view of the in-principle agreement reached with MoD, even if it is not available immediately," it added.
This can be done as "actual assignments do not have to be made immediately", it said. The regulator has recommended that the DoT should take all measures to ensure that the 2100 MHz spectrum which was earlier assigned to S-TEl in three service areas Bihar, Orissa and Himachal Pradesh is also put to auction. STel closed its business in India after the Supreme Court cancelled 122 licences in February 2012 in the 2G spectrum allocation case. The auction for 800, 900 and 1800 megahertz bands is expected to be held in February and DoT is also mulling auctioning 3G radiowaves (2100 Mhz) along with these three bands.