Telecom spectrum auction ends; govt mops up record Rs1,10,000-cr
25 March 2015
The telecom spectrum auction, dubbed as one of the costliest, ended on Wednesday, after 19 days and 115 rounds of fierce bidding among eight operators. The exchequer will receive about Rs1,10,000 crore from the operators who had to bid for continuation of services, as per latest estimates.
The auctions were for 800 MHz, 900 Mhz, 1800 MHz and 2100 MHz that could be used for mobile telephony, broadband and 4G.
The government is yet to announce the winners of the auction, which is expected in the following days, according to various media reports.
On Tuesday, the 18th day of the auction, the government had received commitments of Rs109,000 crore from Bharti Airtel, Vodafone India, Idea Cellular, Reliance Communications, Reliance Jio Infocomm, Tata Teleservices, Aircel and Uninor.
The auction was that of spectrum held by nine licensees across 900 MHz band and 1800 MHz band that were expiring in 2015-16. The spectrum were held by Idea Cellular, seven each of Reliance Telecom and Vodafone India and six of Bharti Airtel that were expiring in 2015-16.
The government also sold airwaves in 1800 Mhz band unsold in 2014 auction and 800 MHz unsold from 2013.
The validity of the spectrum is for 20 years, while most of the spectrum put up in the auction is held by Bharti Airtel, Vodafone India, Idea Cellular and Reliance Telecom.
Successful bidders have to make an upfront payment of 25-33 per cent of the final sale price. This may help the government to garner nearly Rs 25,000 crore immediately through the current round of spectrum auction.
The operators could opt for a deferred payment, which enables them to pay 33 per cent in case of 2100 MHz, 1800 MHz bands and 25 per cent for 900 MHz and 800 MHz bands upfront within 10 calendar days of the close of auction.
The winners will pay the rest of the amount over a period of 12 years - 2 years moratorium and then 10 yearly installments.
The Department of Telecommunications (DoT), the country's licensor, will announce the winners and the quantum of airwaves they won only after it gets the Supreme Court's permission. A number of cases on spectrum auction are pending before the Supreme Court.