Bidding in 1800 Mhz band strengthens as 2G auction continues on 10th day
13 Feb 2014
The auction of 2G spectrum auction today continued on the 10th day and 64th round of bidding, starting off at Rs61,091.83 crore in terms of value.
The bidding in 900 MHz band has stabilised as there was no activity for any of the three circles put up for auction in the last two days, but aggressive bidding was still going on for a few circles in 1800 Mhz band on Wednesday.
"The total bids (so far) are around 27 per cent more than the spectrum value at the base price, were received at the end of 63 rounds on the 9th day," telecom secretary M F Farooqui said in New Delhi this morning.
The bid value for spectrum - 900 Mhz and 1800 Mhz bands - has now reached over 90 per cent of the money that government received in the 3G spectrum auction in 2010, although a larger quantum of radiowaves has been put on the block in the current round.
For spectrum in 1800 Mhz band, bids worth Rs37,502.21 crore, or 106.6 per cent of the radio waves on sale, have been received; and for the premium 900 Mhz band, the bidding amount totals Rs23,589.62 crore.
The price of radiowaves in the 900 Mhz band is now 85 per cent more than the base price.
The government will now get at least Rs18,273 crore in the current fiscal from the auction in case companies opt for instalment payments. The bidders can pay the part of the money upfront and the remaining amount over a maximum of 10 yearly installments.
The spectrum price in Assam circle, which has been seeing strengthened bidding this week, increased 5 times its base price at the end of Wednesday, with bidding at Rs34.75 crore per megahertz. An increased appetite for spectrum in the 1800 Mhz band was also seen in the Madhya Pradesh and Mumbai service areas.
Out of the last five online spectrum auctions, the current one is the largest the in terms of radio waves on sale, and the third-longest till date in terms of duration.
The auction for the broader-band 3G spectrum in 2010 lasted for 34 days, but the sale of broadband wireless access (BWA) spectrum ended in 16 days. The next 2G auction in November 2012 ended in just two days, while the CDMA auction in March last year concluded the same day.
There is no time limit for the sale of spectrum and the duration of the current auction will depend on the appetite of the eight companies in the fray -- Bharti Airtel, Vodafone, Idea Cellular, Reliance Jio Infocomm, Aircel, Tata Teleservices, Telewings (Uninor) and Reliance Communications.
The government has put on the block about 385 Mhz of spectrum in the 1800 Mhz band, and 46 Mhz in 900 Mhz band.
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