Telecom auction gets Rs 60,000 cr bids on first day

The biggest ever auction of 2G and 3G spectrum started on Wednesday on a high note with operators making bids worth an estimated Rs 60,000 crore after six rounds of bidding in all four bands.

The bidding will resume on Thursday in the auction through which the government is expecting to raise around Rs 1 lakh crore.

 “Six rounds of bidding were concluded on Wednesday with bids worth Rs 60,000 crore coming in all the four bands on offer,” a source said.

While eight telecom firms are bidding for the radio waves, the government decided not to release the bidding details to the public due to a court ruling.

No 2 mobile market
Incumbent Bharti Airtel and Vodafone are locked with upstart carrier Reliance Jio of billionaire Mukesh Ambani to protect their spectrum they need to carry voice and data in the world’s second-biggest mobile phone market.

The auction is the biggest ever sale of 2G and 3G airwaves which may fetch the government over Rs 82,000 crore at the base price. The government is selling airwaves in four bands: 2,100 megahertz (Mhz), 1,800 Mhz, 900 Mhz and 800 Mhz.

While 900 Mhz and 2,100 Mhz bands witnessed good bidding, 800 Mhz was the surprise band with lots of interest. However, there was not much bidding in Mumbai, Delhi and Karnataka circles in the 2,100 Mhz band, the source said.

A total of 380.75 Mhz of spectrum is on offer in the premium 900 Mhz band, 1,800 Mhz and 800 Mhz while 5 Mhz is up for bidding in the 2,100 Mhz band across 17 out of 22 telecom areas or circles in the country.

Licence renewal
Mobile licences for nine circles of Idea Cellular, six circles of Airtel and seven circles each of Vodafone and Reliance Telecom are, meanwhile, coming up for renewal.

Overall, there are 29 licences in 18 service areas which will expire in 2015-16. These licences hold 184 Mhz spectrum in the 900 Mhz band and 34.2 Mhz in 1,800 Mhz band.
It is mandatory for these companies to bid for spectrum if they want to continue offering mobile and other telecom services as their permit is expiring.

"The Indian telecoms auction  is likely to see intense bidding by telcos to retain their existing spectrum and to acquire new spectrum as supply is limited," Fitch Ratings said.
The government had raked in Rs 62,162 crore from the last spectrum auction held in February 2014.