The government received bids worth more than Rs.53,000 crore on the first day of the biggest ever auction of the country’s telecom spectrum, according to sources. A total of 2,300 MHz of spectrum worth Rs.5.6 lakh crore has been put up for sale.
On Saturday, five rounds of bidding were completed. No bids were received for the much-touted 700 MHz band, which is being put up for auction for the first time.
While 700 MHz is considered most suitable for offering high speed broadband services, industry players have been complaining about its high pan-India reserve price of about Rs.11,500 crore per MHz.
Hence, analysts were expecting a muted response for this band.
Maximum interest was seen in the 2,100 MHz, 2,300 MHz and the 2,500 MHz bands.
Limited bidding was also witnessed in the 1,800 Mhz Band.
Seven firmsSeven firms — Airtel, Vodafone, Idea Cellular, Reliance Communications, Aircel, Reliance Jio Infocom, and Tata Teleservices —are in the fray to acquire spectrum in seven bands — 700, 800 MHz, 900 MHz, 1,800 MHz, 2,100 MHz, 2300 MHz and 2500 MHz.
The auction will resume on Monday morning and each round will last for an hour.
According to research agency CRISIL, the telecom firms are expected to fork out about Rs.1 trillion (Rs.1 lakh crore) to buy spectrum at the auctions.
The government had raked in Rs 1.1 lakh crore from the last spectrum auction held in March 2015. It had sold spectrum across 800 MHz, 900 MHz, 1,800 MHz and 2,100 MHz bands
“The auction is on expected lines - there was no bidding on 700 MHz and 1,800 MHz saw interest in the circles where there is some shortage.
“We should see some intensity over the next day or so and closure of the auction within the next week.”
Reliance JioThe auctions are happening close on the heels of the commercial launch of Reliance Jio, which has stirred a storm in the India telecom sector with its very competitive prices.
As incumbents fight to retain customers, the focus is on good quality services amid frequent call drops and slow data speeds.The spectrum won via the auctions, which is an Internet-based online process, will be allotted for a time frame of 20 years. The centre had fixed a reserve price of Rs.2,873 crore for spectrum in 1,800 MHz band, Rs.3,341 crore for 900 MHz, Rs.5,819 crore for 800 MHz, Rs.3,746 crore for 2,100 MHz, Rs.11,485 crore for 700 MHz.
