An internal committee of the Department of Telecommunications (DoT) has proposed multiple options for pricing spectrum in the 800 MHz band in case the government decides to auction the spectrum to CDMA players. The DoT committee has proposed a reserve price between Rs 22.31 billion and Rs 35.44 billion for 1.25 MHz of pan-India spectrum in the 800 MHz band.
A final decision on the pricing of the spectrum in the 800 MHz band will be taken by an Empowered Group of Ministers on telecom. The DoT committee has suggested the reserve price of spectrum in the 800 MHz following the Telecom Regulatory Authority of India?s (TRAI) refusal to recommend a reserve price since the authority is not in favour of auctioning spectrum in the 800 MHz to CDMA players. Instead, the regulatory body had suggested offering this spectrum to GSM operators.
Earlier, TRAI had stated that the reserve price for spectrum in both the 800 MHz and the 900 MHz bands should be priced identically since both the bands offered similar benefits in terms of coverage and efficiency. It had suggested that the government should not price spectrum in the 800 MHz band lower than its estimated market value. Further, the regulatory body had recommended that since there was lower demand for CDMA spectrum, the government should offer this spectrum to GSM players.
However, TRAI?s recommendations were overruled by the Telecom Commission on the grounds that keeping spectrum in the 800 MHz band unsold would result in the government forgoing potential revenues.
