The Department of Telecom may put nearly 24 slots of spectrum on sale in the next round of auction.
This includes 12 slots each in the 1800 MHz and 900 MHz bands. Each slot is of 1.25 MHz and operators will be allowed to buy at least four slots. Bidders will be permitted to buy up to 25 per cent of all spectrum assigned in different bands.
The auction is scheduled to be held before March and the Government is expecting around Rs 25,000 crore from the sale.
This is a change from the recent auction that failed to attract aggressive bids because the Government had restricted the amount of spectrum to just eight slots with a rider that no player can acquire more than five slots. The base price was also high. As a result there were no bids for the four circles of Delhi, Mumbai, Rajasthan and Karnataka.
Reserve price down 30%
Under the new plan, the DoT has reduced the reserve price by 30 per cent. It has also put more spectrum on the block besides allowing operators to buy more than five slots as long as they do not corner more than 25 per cent of all spectrum available.
The DoT plans to put 15 MHz of spectrum in 1800 MHz band in Delhi and Mumbai for auction at a reserve price of Rs 485.15 crore and Rs 474.92 crore per block, respectively. In the previous auction, the Government had put only 10 MHz for auction divided into eight blocks of 1.25 MHz each for Rs 693.06 crore in Delhi and Rs 678.45 crore in Mumbai.
In the new auction plan, DoT will auction 11 blocks of spectrum in Rajasthan and Karnataka at a reserve price of Rs 46.96 crore and Rs 231.08 crore, respectively. For the 900 MHz band, the Government is learnt to have fixed minimum price of Rs 970.30 crore per block for Delhi, Rs 949.84 crore per block for Mumbai and Rs 227.44 crore per block for Kolkata circle. The Government may auction 15 MHz of spectrum in 900 MHz band in Delhi and Mumbai circle and 12.5 MHz airwaves in Kolkata.
According to the draft proposal, new players may be required to bid for a minimum of four blocks in both 1800 MHz and 900 MHz band in Delhi and Mumbai. New entrants may have to bid for four blocks in Rajasthan and Karnataka where 1800 MHz band will be auctioned.
Interestingly, incumbent operators whose licences are set for renewal in 2014 will be considered as new players. This means that Airtel and Vodafone, whose licences in Delhi and Mumbai are set to expire in 2014, will be treated as new players in these circles enabling them to buy more than five slots of spectrum.
Thomas.thomas@thehindu.co.in