Provision winning price on the first day stands at Rs.2,914 cr

The much-awaited auction for 3G spectrum began on Friday with all major telecom companies bidding aggressively to acquire radio waves to offer advanced mobile services.

Against the reserve price of Rs. 3,500 crore for a pan-India licence, the provisional winning price (cumulative) on the first day of bidding stood Rs. 3,913.81 crore for all 22 circles.

This could be good news for the government that is hoping for a windfall from the entire auction process where 3G bidding will be followed by broadband wireless access (BWA) spectrum auction. “We are hoping to garner anywhere between Rs. 40,000 crore and Rs. 45,000 crore from the sale of radio waves that will further revolutionise the Indian telecom market,” Communications and Information Technology Minister A. Raja told journalists.

As many as nine telecom companies — Bharti Airtel, Vodafone Essar, Tata Teleservices, Reliance Communications, Idea Cellular, Aircel, Videocon Telecommunications, Etisalat DB and S Tel — are taking part in the auction.

On the first day, as many as five rounds of auction were completed where companies bid for all 22 telecom circles.

The highest provisional wining bid at the end of round 5 was that of Rs. 373.39 crore for the Delhi circle, followed by Rs. 362.66 crore for Mumbai, Maharashtra, Gujarat, Andhra Pradesh, Karnataka and Tamil Nadu.

Similarly, the provisional winning price for Kolkata, Uttar Pradesh West and East stood at Rs. 135.99 crore; for Kerala Rs. 134.65 crore; for Madhya Pradesh Rs. 133.62 crore; for Haryana Rs. 133.32 crore, for Rajasthan Rs. 132.30 crore; for Punjab Rs. 121.20 crore; for West Bengal Rs. 120 crore; for Bihar Rs. 31.50 crore, and for Himachal Pradesh, Assam, Orissa, North East and Jammu and Kashmir Rs. 30 crore.

The e-auction process would take days before the process is completed for the roll out of pan-India 3G services later this year that would help mobile users to enjoy real Internet experience on their mobile handsets.

A 3G-enabled handset will help a user to experience faster downloading of full length movies or music files, live TV and video calls. It will also give a fillip to mobile commerce and also to the entertainment industry.

According to NM Rothschild (India)'s Head Sanjay Bhandarkar, the e-auction mechanism has been designed to prevent predatory bids.

According to the auction rules, bidders cannot name their price and they can only accept or reject the price posted in each round. The bidding process would stop only when the highest bids have been detected for all the circles simultaneously, he added.

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