On the second day of the 2G spectrum auction, operators are reportedly focusing on obtaining spectrum in the Bihar circle. According to news reports, on the first day of the auction (November 12, 2012), the provisional winning price in the Bihar circle increased by over Rs 17 million over the reserve price. The demand for spectrum in all other circles remains lukewarm.
At the end of the seven rounds of bidding on the first day of the auction, the provisional winning price in 17 of the 22 circles up for auction was the same as the base price set by the government (Rs 140 billion).
Further, news reports state that at the end of the first day, the government received bids worth Rs 92.24 billion, which is less than 25 per cent of the Rs 400 billion it hoped to gain through the auction. Interestingly, after cancelling the CDMA spectrum auction (as both participants said they will not bid), the government pruned its target to Rs 200 billion.
Meanwhile, on the first day of the auction, No telecom operator reportedly bid for spectrum in key circles such as Delhi, Karnataka, Rajasthan, Kolkata and Mumbai, nor were there any takers for pan-India spectrum.
According to a report released by the Department of Telecommunications, only one block was bid for in Uttar Pradesh (East), no block was bid for in Gujarat; all eight blocks were bid for in Bihar; seven in Assam; six each in West Bengal, Haryana, Orissa, Jammu and Kashmir, Madhya Pradesh and North-East, five each in Maharashtra; four each in Andhra Pradesh, Kolkata and Tamil Nadu; and one each in Himachal Pradesh, Kerala and Punjab.
News reports suggest that the low level of interest in the auctions was owing to the high base price of Rs 140 billion for pan-India spectrum, which is more than seven times what the operators paid in 2008.
Bharti Airtel, Vodafone India, Idea Cellular, Telenor and Videocon are bidding for GSM spectrum. However, there are no takers for CDMA spectrum, after Tata Teleservices Limited and Videocon said they would not participate.
