Videocon to bid for additional spectrum in Punjab, Madhya Pradesh

Mobile operator Videocon plans to bid for additional spectrum in two service areas such as Punjab and Madhya Pradesh, in upcoming auction starting January 23.

"Considering our growth plans, business projections and the fact that we want to give the best experience to our customers, we are planning to acquire additional spectrum for Punjab and MP (includes Chattisgarh) circles," Videocon Telecom Director and CEO Arvind Bali said.

Videocon is the first company to confirm its participation for the next round of spectrum auction.

Last two spectrum auctions, held in November 2012 and March 2013, had seen poor response from the telecom industry.

The company currently holds 4.4 Mhz spectrum in Punjab and 5 Mhz spectrum in Madhya Pradesh telecom circle, which includes Chattisgarh as well.

The company has plans to bid for additional 2 Mhz in these service areas.

At minimum price fixed by the government for these areas, additional spectrum would cost Videocon about Rs 190 crore. However, the final price will depend on the competition for airwaves in these service areas.

Videocon has purchased spectrum through auction in 6 out of 7 service areas where it has operations and plans to provide 4G service in these circles.

The company is free to use any technology in the airwaves purchased through auction, known as liberalised spectrum.

"Incremental capacity created by the additional 2 Mhz spectrum will be at least 2 times the existing capacity given the trunking efficiency. Also, the planned 2 Mhz additional spectrum in Punjab telecom circle, being a liberalised one, will give us the option to offer 4G LTE Narrowband service there," Bali said.

As per data released by telecom regulator TRAI, the company has been recording highest growth in net subscriber addition in last 5 months.      Videocon has targetted to achieve a 'fair market share' (FMS) in the services areas such as Madhya Pradesh, Punjab, Haryana and Gujarat.      

FMS amounts to 12.5 per cent subscriber share in Haryana, Punjab and Madhya Pradesh, where there are a total of eight operators, and 10 per cent market share in Gujarat, which has a total of 10 mobile service providers.

"We expect this to happen within one year in Haryana and Punjab, followed by Madhya Pradesh and Gujarat in the subsequent year," Bali said.