TRAI suggests 3G base rate at Rs 2,720 cr per Mhz

The Telecom Regulatory Authority of India on Wednesday suggested a base price or auction starting price of Rs 2,720 crore per Mhz for sale of pan-India 3G mobile spectrum, which is about 19 per cent lower than what operators paid in 2010.

The TRAI also 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 authority recommends that the reserve price for 2100 MHz spectrum in each LSA (licence service area) should be Rs 2,720 crore,” said the regulator. The next auction is likely to be held in last week of next month.

The 3G spectrum in 2010 had attracted bids worth Rs 16,750.58 crore for a block of 5 Mhz frequencies on pan-India basis which amounts to about Rs 3,350 crore per Mhz. The recommended base price is about four times higher on per megahertz basis when compared to reserve price of Rs 3,500 crore for 5 Mhz fixed by the government for last 3G auction.

“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 said, adding that this can be done as “actual assignments do not have to be made immediately,” it said.