TRAI suggests cut in spectrum auction floor price

The telecom regulator of India Monday recommended lowering of the floor price for mobile spectrum auction.

It also said there should be no reservation of spectrum for the renewal licensees in 900 or 1,800 MHz bands. And no priority should be accorded to these licensees in the bidding process and all bidders should be treated alike, it added. The Telecom Regulatory Authority of India (TRAI) said that the reserve prices for 1,800 MHz spectrum for Delhi should be Rs.175 crore per megahertz (MHz), for Mumbai Rs.165 crore per MHz, and for Kolkata Rs.59 crore per MHz. 

For pan-India, the reserve price would be Rs.1,496 crore per MHz. It also recommended that the reserve prices for 900 MHz spectrum for Delhi should be Rs.288 crore per MHz, for Mumbai Rs.262 crore per MHz and for Kolkata Rs.100 crore per MHz. TRAI said all spectrum allocated through auction should henceforth be charged at a flat rate.

In the last two auctions held November 2012 and March 2013, service providers stayed away, citing high floor price. The regulator said the DoT (Department of Telecom) should come out with a clear roadmap before the upcoming auction, indicating the quantum of spectrum which will be available in future along with time-lines so that licensees whose licences are due for renewal in 2015-16 can take an informed decision about bidding for spectrum in the 1,800 MHz band.

TRAI said the eligibility conditions prescribed in the previous auctions should be retained for the upcoming auction. It also recommended roll-out of certain other obligations for licencees having access spectrum (spectrum in 800/900/1800 MHz band).  “All villages having population of more than 5,000 to be covered within five years of effective date of allocation of spectrum for access services and all villages having population of more than 2000 to be covered within seven years of effective date of allocation of spectrum.”