The Department of Telecommunications (DoT) has initiated the spectrum auction to augment the existing telecom services and maintain continuity of services. DoT has issued notice inviting applications (NIA) on March 8, 2024 to this effect.
As per the NIA, highlights of the spectrum auction, include:
- Spectrum being auctioned: All the available spectrum in 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz, 3300 MHz, and 26 GHz bands is part of the auction.
- Process of auction: The auction shall be a simultaneous multiple round ascending (SMRA) e-auction.
- Reserve price: The cumulative reserve price of the 10523.15 MHz spectrum put to auction is Rs. 963.17 billion.
- Duration of spectrum: Spectrum will be assigned for a period of 20 years.
- Payment: Successful bidders will be allowed to make payment in 20 equal annual installments, duly protecting the net present value (NPV) at the interest rate of 8.65 per cent.
- Surrender of spectrum: Spectrum acquired through this auction can be surrendered after a minimum period of ten years.
- Spectrum usage charge (SUC): There will be no SUC for spectrum acquired in this auction.
According to the NIA, the companies seeking to buy spectrum can apply till April 22, 2024. Subsequently, a mock auction will be conducted on May 13, 2024 and May 14, 2024, following which the actual sale will start on May 20, 2024.
Further, the objectives of the auction include obtaining a market-determined price of spectrum through a transparent process and stimulating competition in the sector. As per the eligibility criteria, while it is mandatory for a company to have the unified access services licence (UASL)/unified licence (UL) permit to participate in the auction, any prospective new entity or firm can also bid for airwaves by giving an undertaking that it will obtain a UL.
In addition, as per the NIA, it is not required by the successful bidder to submit a financial bank guarantee (FBG) and performance bank guarantee (PBG).
