The Telecom Commission has proposed increasing the base price of spectrum in the 1800 MHz band by more than 15 per cent. While the Telecom Regulatory Authority of India (TRAI) had suggested a base price of Rs 14.96 billion for 1 MHz of pan-India spectrum in the 1800 MHz band, the Telecom Commission has suggested a base price of Rs 17.63 billion.
The higher price for pan-India spectrum is due to a 25 per cent increase in the reserve price of spectrum for eight circles, including metro and category A circles such as Maharashtra, Andhra Pradesh and Tamil Nadu. The Commission has, however, accepted the reserve price suggested by TRAI for the remaining 14 circles in the 1800 MHz band. In case the cabinet accepts Telecom Commissions? proposals, then the reserve price for spectrum in the 1800 MHz band in the Delhi, Mumbai and Kolkata circles would be about Rs 2.19 billion, Rs 2.07 billion and Rs 0.73 billion, respectively.
In the 900 MHz band, the Telecom Commission has proposed to increase the reserve price by 25 per cent in the Delhi, Mumbai and Kolkata circles. This spectrum band is currently held by incumbent operators whose licence is going to come up for renewal in 2014. A higher base price would imply that players such as Bharti Airtel, Vodafone India and Idea Cellular will have to pay more if they want to continue providing services using the 900 MHz band.
In addition, the Telecom commission has also taken a decision on auctioning the 800 MHz band which currently being used by CDMA operators. Earlier, TRAI had recommended that the 800 MHz band should be used for providing GSM services. The Telecom Commission has also recommended raising the limit on the market share of a merged entity in a circle from 35 per cent to 50 per cent.
