Cabinet approves telecom spectrum auction

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The Cabinet on Wednesday approved the telecom spectrum auction, to be held in March. The notice for inviting applications will be issued within this month.

The auction will be for spectrum in 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz frequency bands and a total of 2251.25 MHz will be offered with total valuation of ₹3,92,332.70 crore (at reserve price).

Spectrum will be offered for assignment for a validity period of 20 years, the government said in a statement.

By winning the right to use spectrum through the auction, incumbent telecom service providers will be able to augment their network capacity, whereas new players will be able to start their services.

Successful bidders may pay entire bid amount in one go (upfront) or may exercise an option to pay a certain amount (25 per cent for spectrum won in 700 MHz, 800 MHz, 900 MHz bands or 50 per cent for spectrum won in 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz bands) upfront and remaining amount in a maximum up to 16 equated annual instalments, after a moratorium of two years.

“In addition to the bid amount, successful bidders will also have to pay 3 per cent of the Adjusted Gross Revenue (AGR) excluding wireline services as spectrum usage charges for the spectrum won through this auction,” it said.

In the auction, bidders will have to comply with parameters/conditions like block size in which bidders will be able to submit their bids, spectrum cap — the maximum amount of spectrum that can be held by each bidder after the completion of the auction, roll-out obligations, and payment terms.

The last auction was held in October 2016 and bids worth around ₹65,789 crore were received at the end of 31 rounds for 965MHz of spectrum out of the total 2354.55MHz put for auction.

There was no bidder for the 700 MHz then and Telecom Regulatory Authority of India had to lower the prices of most of the bands.



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