The Empowered Group of Ministers (EGoM) on telecom, headed by Finance Minister P Chidambaram, will meet again on January 7 as it could not reach any decision on the upcoming auction in its meeting today.
“The EGoM today deliberated upon several issues for about two hours and decided to meet again on January 7 to further discuss the issues. Once the EGoM takes decisions, the issues will be referred to the Cabinet. No decision is being taken today,” Telecom minister Kapil Sibal told reporters today.
The EGoM today mainly had a discussion on the possible design of the upcoming auction of spectrum under both 1800 MHz and 900 MHz bands. However, it could not discuss the fate of the 800 MHz spectrum band, mainly used by the CDMA operators. “Auction does not seem possible by January 18, but will take place by March,” said a top government official.
The EGoM was likely to discuss on whether it would consult the Telecom Regulatory Authority of India (Trai) on what it should do with the 800 MHz band of spectrum that failed to get bidders in the November round of auction. It might also decide to conduct a fresh auction of the 800 MHz band of spectrum alongwith the 1800 MHz and 900 MHz bands of spectrum in the next round that would be conducted by March.
The issue is likely to be discussed in the next EGoM meeting on January 7.
Telecom operators, which lost operating because of the Supreme Court order in February last year, are allowed to offer their services till January 18.
The EGoM had earlier decided to conduct auction in Delhi, Mumbai, Karnataka and Rajasthan for 1800 MHz airwaves band at a revised based price (30 per cent lower than the reserve price of November auction) as these circles did not receive bids in the November auction. Under the 900 MHz band it will conduct auction in Delhi, Mumbai and Kolkata. The base price for 900 MHz spectrum would be twice of the 1800 MHz base price for respective telecom zones.
The Government is learnt to be preparing fresh plans to auction the spectrum that can fetch around Rs 39,895 crore. As per the proposal, the Government could get around Rs 25,316 crore from the auction of the premium 900 Mhz band, and Rs 14,579 crore from the auction of unsold spectrum in the 1800 Mhz band.
The EGoM, however, is likely to put 34 blocks of 1.25 MHz each in the liberalised 900-MHz band up for auction in the Delhi, Mumbai and Kolkata circles. This would ensure at least 5 MHz, or four blocks of 1.25 MHz each, for a new entrant.
The 900-MHz band is considered more efficient for high-speed data services. The lower the frequency of a radiowave band, the higher the signal strength and reach. This means fewer base stations and towers would be needed. Companies providing WiMax services would also be interested in the liberalised 900-MHz band.
The Department of Telecommunications (DoT) has plans to put 15 MHz of spectrum in the 1,800-MHz band in Delhi and Mumbai up for auction at base prices of Rs 485.15 crore and Rs 474.92 crore a block, respectively. In November, the government had offered only 10 MHz of the radiowaves in these circles, at reserve prices of Rs 693.06 crore and Rs 678.45 crore, respectively.
In Rajasthan and Karnataka, 11 blocks of 1.25 MHz each would be auctioned at reserve prices of Rs 46.96 crore and Rs 231.08 crore, respectively. Operators would be allowed to buy up to 25 per cent of all spectrum assigned in different blocks.