The momentum in the ongoing spectrum auction has shifted towards the 1800 MHz band seven days after the bidding started.
The bid amount for 1800 MHz has reached ₹34,900 crore, which is 20 per cent higher than what the Government could have got if it sold all spectrum at reserve price.
The bid amount for 900 MHz has reached ₹23,500 crore, 84 per cent higher than the reserve price. The Government stand to get ₹58,400 crore after 49 rounds of bidding.
Price for 1800 MHz in 5 circles have crossed what the operators paid for 3G spectrum in 2010. This includes Assam, Bihar, Gujarat, Maharashtra and J&K.
There are two views emerging on whether the auction is a success or a failure yet.
The majority view is that the bid amount has crossed expected levels and operators are stretching to win back spectrum. The proponents of this view say that such large payouts will impact mobile tariffs as operators try to recover the cost.
But there is a small section of the industry which says that the bidding for 900 MHz is yet to reach its full value. “TRAI has noted in its May, 2010 recommendations that 900 MHz is far more efficient both technically and economically and it is one of the most used and harmonized bands in the world.
“Thus, 900 MHz liberalised spectrum is far more precious than the earlier auctioned 3G spectrum and hence the current bid price of 900 MHz spectrum has a long way to go,” said an operator in the fray.
Either ways, the biggest beneficiary is the Government because the auction revenue can go a long way in reducing the fiscal deficit.