• Spectrum in the 2.1 GHz band will be allocated for 3G services.
  • Spectrum will be auctioned in blocks of 2×5 MHz and will be on a telecom service area (state) basis. The number of blocks to be auctioned may vary from 5 to 10 depending on the availability in each circle. The successful bidder will be allotted airwaves for a period of 20 years.
  • Spectrum will be auctioned in the 450 MHz and 800 MHz bands for EVDO services and in the 1900 MHZ band when it becomes available. CDMA spectrum in the 800 MHz band for EVDO applications will be treated separately from the 2.1 GHz spectrum. CDMA operators may opt for 2×1.25 MHz in the 800 MHz band, subject to availability. They would have to pay an amount proportionate to the highest bid for spectrum in the 2.1 GHz band. The allotment will be linked to the subscriber base in the service area.
  • New players, including foreign companies, can participate in the auction, provided they have at least one year’s experience in offering 3G services. Successful bidders who are not UAS licensees will be given a separate UAS licence for the concerned licence area under the Indian Telegraph Act, 1885. The new entrants will also have to pay an additional entry fee of Rs 16.5 billion for obtaining a 2G UAS licence.
  • The government has doubled the reserve price recommended by TRAI for spectrum in the 2.1 GHz band to Rs 1.6 billion for Mumbai, Delhi and Category A circles; Rs 800 million for Chennai, Kolkata and Category B circles; and Rs 300 million for Category C circles. The reserve price for companies wanting to participate in a panIndian auction for 3G spectrum has been fixed at Rs 20.2 billion.
  • 3G spectrum will be granted through a controlled, simultaneous ascending e-auction by a specialised agency to ensure transparency in the selection process.
  • Successful bidders will have to deposit the entire amount within 15 calendar days of the bid or forfeit the earnest money, which will be 25 per cent of the reserve price in the form of bank guarantees.
  • One block will be allocated to MTNL in Delhi and Mumbai and to BSNL in other service areas at a price equal to the highest bid in the respective service area.
  • Telecom operators are required to cover 90 per cent of the metros and 50 per cent of the district headquarters (DHQs) or cities in a circle within five years of getting 3G spectrum. Moreover, in 50 per cent of the DHQs, 15 per cent coverage should be in rural short distance charge areas (SDCAs).
  • There will be no spectrum charge for 3G services in the first year of operations. Once the moratorium ends, 3G operators will be required to pay an annual spectrum charge of 1 per cent of their annual gross revenue.
  • If telecom companies fail to meet their rollout obligations, they will have to pay a spectrum hoarding charge. The operators would be given an extension of one year by making a payment of 2.5 per cent of their winning auction bid per quarter. If the operator fails to meet the rollout obligation within the one-year extension, the spectrum will be withdrawn.