Spectrum auction stuck in the slow lane; total bids rise to Rs56,872 cr
04 Oct 2016
The government's spectrum auction, which got on to a slow start on Saturday, failed to gain momentum and instead appeared to slow down on Day 2 with bids of only 3,341 crore taking the total to Rs56,872 crore.(See: Spectrum auction begins with Rs53,531-cr bids on Day1; no bids for 700 MHz spectrum)
The auction on Saturday, the first day, had closed with bids worth Rs 53,531 crore in five rounds of bidding.
In signs that telcos are reserving their bidding strengths for the final rounds, the premium 700 MHz and 900 MHz bands found no takers on Monday as demand was mainly for the widely-used 1800 MHz band.
With six more rounds of bidding on Monday and the total number of rounds conducted so far rising to 11 the addition to the first day's bidding was a mere Rs3,341 crore.
The demand for airwaves was confined to select circles like Mumbai, UP East and West and Gujarat and for select bandwidths like 800MHz, 1800MHz, 2100MHz, 2300MHz and 2500MHz.
Spectrum in the 1800 MHz band that can be used to provide 4G and 2G services continued to be in demand in circles like Mumbai and UP East. The price of the spectrum has also gone in the circles of Mumbai, Rajasthan, UP East and West and Haryana.
Bidders in the Gujarat, Rajasthan, Uttar Pradesh (East) showed interest in the 800 MHz band, which is seen as the next best alternative to the 700MHz band in terms of efficiency and transmission of signals.
Spectrum in the 2300 MHz band, which is the least cost alternative to all other bands, was in demand for circles in Bihar, Gujarat, Kerala and Maharashtra.
Telecom operators also placed bids for 2100 MHz band spectrum for the Delhi, Maharashtra, Bihar, J&K, Kerala, Odisha, Punjab, Rajasthan, Tamil Nadu and UP East circles. This band is used for providing 3G services.
Operators also bid for the 2500 MHz band in Delhi, Gujarat, Kolkata, Maharashtra and Mumbai, Rajasthan, UP East, UP West, and Bengal. This band is useful where population density is high.
Bidders continued to ignore the premium spectrum bands of 700MHz and 900MHz on the second day as well, possibly because of the high prices.
A total of seven telecom companies, including Bharti Airtel, Vodafone, Idea Cellular, Reliance Jio, Aircel, Reliance Communications and Tata Teleservices, are in the fray.
Bids for the third day started at 9:00 am today.
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