2G spectrum auctions get tepid response

India's proposed 2G spectrum auction in March seems slated to end on a tepid note with leading telecom operators such as Bharti Airtel, Vodafone India and Idea Cellular not having applied to participate in the auction.

On Monday (25 February 2013), Sistema Shyam Teleservices (SSTL) was the only operator to file application to take part in the 800 MHz auction. The operator, a joint venture between Russia's Sistema and India's Shyam Group, offers CDMA services under 'MTS' brand.

''SSTL is committed to its operations in India. Post auctions with the operational footprint clearly defined, the plan is to focus on SSTL's data centric-voice enabled strategy in select circles and build an even stronger MTS brand in India,'' the company said in a statement, confirming the auctions.

According to media reports, other operators stayed away from the auctions as spectrum prices were ''unrealistic''. According to commentators, 2G prices in India were high compared with 4G spectrum prices in countries such as the UK and Germany.

They say another issue is falling profits of operators, which have been down for 10 - 12 quarters mainly due to the interest rate on debt borrowed for operations and 3G spectrum.

"No, there will not be an auction in both (1800 & 900 Mhz) bands. In all probability, the matter will have to go to the empowered group of ministers before a final view can be taken to work out a way and to go forward," R Chandrasekhar, secretary, department of telecommunications, told The Economic Times on Monday.

On 2 February 2012, the Supreme Court had cancelled 122 2G licences provided after January 2008 in on grounds they were issued in a ''totally arbitrary and unconstitutional'' manner (See: SC cancels all 2G licences, orders fresh spectrum auction).