The union cabinet has approved spectrum auctions for telecom services, which are scheduled to take place within the next two to three months. The auctions will witness the sale of airwaves amounting to a cumulative reserve price of Rs 963.17 billion. Spectrum will be auctioned in the 800 MHz, 900 MHz, 1,800 MHz, 2,100 MHz, 2,300 MHz, 2,500 MHz and 3,300 MHz bands, as well as in the 26 GHz band.
As per the union cabinet, the reserve prices for various bands have been revised using suitable indexation as recommended by the Telecom Regulatory Authority of India (TRAI). Further, a committee of secretaries has been set up to consider re-farming of existing spectrum, with a view to increasing spectrum availability to meet the future needs of telecom services.
Moreover, the government plans to auction expiring airwaves that belong to certain
companies that are undergoing insolvency. If sold, the spectrum would be valid for a
20-year period.
Additionally, the cabinet has approved a proposal for meeting the spectrum requirements of rail-based urban/regional transit systems such as the National Capital Region Transport Corporation (NCRTC) in the 700 MHz band for automatic train protection systems and operations.
Following the approval of the spectrum auctions, the Department of Telecommunications will issue a notice inviting applications, laying down the rules and processes for the auctions.
Industry experts believe that the upcoming auctions will witness limited activity and are targeted primarily at telecom operators that need to top up their existing spectrum for ongoing operations. Overall, telcos are not expected to make significant investments on spectrum this year, especially since they bought ample spectrum in the previous auction.
That being said, once the NIA is issued and the auctions take place, it will be interesting to see if the telcos line up only to meet their existing spectrum requirements or engage in cutthroat competition to grab a share of the airwaves on offer.
