Next spectrum auction scheduled for January 8

Telcos will have to apply by December 23; Telecom Commission to take final call on pricing on October 29

The Department of Telecommunications (DoT) hopes to start the next round of spectrum auction on January 8, 2014, according to the tentative timeline an inter-ministerial committee (IMC) has worked out.

The IMC said that the Empowered Group of Ministers (EGoM) headed by Finance Minister P Chidambaram would complete the review of the Telecom regulatory Authority of India's (Trai) recommendations on spectrum pricing by November 7, based on comments from the DoT committee and the Telecom Commission. The Cabinet's approval is expected to come by November 23.

According to the IMC, the DoT would finalise and issue notice inviting applications (NIA) by December 2, while interested bidders will have to apply by December 23.

SPECTRUM BUZZ

• November 23: Cabinet approval on review of Trai recommendations expected
• October 29: Telecom Commission scheduled to meet, expected to take final call on spectrum pricing
• December 2: DoT to finalise and issue notice inviting applications
• January 4, 2014: DoT to publish the final list of bidders, followed by public information sessions on January 6 and 7

According to the tentative timeline, DoT will publish the final list of bidders on January 4, 2014, followed by public information sessions on January 6 and 7.

Meanwhile, the Telecom Commission is scheduled to meet on October 29 where it is expected to take a final call on spectrum pricing. The EGoM's decision will depend on the views of the Telecom Commission.

Earlier, DoT secretary M F Farooqui had said the government had set a target to garner more than Rs 11,300 crore from the auction of radiowaves in three bands - 1,800 MHz, 900 MHz and 800 MHz. The government needs to conduct the auction to comply with an order by the Supreme Court.

The DoT will auction all spectrum in the 1,800 MHz band, which was freed from the cancellation of 122 licences by the Supreme Court in February 2012 in the 2G spectrum allocation case.

In the 900 MHz band, the DoT will auction the spectrum in Delhi, Mumbai and Kolkata telecom zones. This spectrum held by Bharti Airtel, Vodafone India and Loop Mobile is due for renewal in the next year.

Following the muted response from telcos in the past two auctions conducted in November 2012 and March 2013, the EGoM had asked Trai for its suggestions on pricing and valuation of spectrum. In its recommendations, Trai had recommended a reduction in the base price of 1,800 MHz by 37 per cent and up to 60 per cent in 900 MHz in Delhi, Mumbai and Kolkata circles.

In November last year, the government could earn only Rs 9,407.64 crore by auctioning 1,800 MHz spectrum. Although the government had auctioned 176 blocks (1.25MHz each) of the total 198 blocks in the November auction, it managed to get bidders for 101 blocks.

Four circles - Mumbai, Delhi, Karnataka and Rajasthan - did not get any bidder due to high reserve price in the November auction. The government had, then, reduced the base price for these circles by 30 per cent. It had also cut the base price of the 800MHz spectrum by 50 per cent.

In March this year, the government received just Rs 3,639 crore from the auction of 800MHz CDMA spectrum as Sistema Shyam Teleservices was the only company to bid selectively. There was no bidder for the 1800MHz band of spectrum.