DCC may discuss proposal to conduct spectrum auction in December meeting

Telecom Secretary Anshu Prakash on Monday said the proposal to conduct spectrum auctions in this financial year could be discussed in the Digital Communications Commission (DCC) meeting scheduled next month. He, however, did not specify the date for the meeting. DCC is the apex decision-making panel of the government on telecom. The telecom panel is expected to approve the suggestions made by the Telecom Regulatory Authority of India (Trai) on the quantum and price of 5G spectrum and the airwaves in the premium 700 MHz band.

The regulator said its August 2018 recommendations on spectrum valuation and reserve prices never mentioned anything on financial health and capability of the companies to bid, and what is being attributed to it now is a concern expressed by a section of stakeholders as part of the consultation process.

Bharti Airtel, Vodafone Idea, and Jio had urged the government to reduce the price, following which the matter went to the regulator for a review.

Trai, in July 2019, stuck to its original recommendation that radiowaves used for telecom services on 5G and other bands should be auctioned at a start price of over Rs 5.7 trillion.

The last spectrum auction in October 2016 saw only 40 per cent of the spectrum offered being sold. In that auction, the government had garnered Rs 65,789 crore from the sale of just 965 MHz. The entire 2,354.44 MHz that was on offer at the base price of Rs 5.63 trillion.

Among the bandwidth, which went unsold, was the valuable 700 MHz which telcos gave a miss, citing high base price. The band is considered premium because of better penetration indoors. Trai recommended fixing a lower base price of Rs 6,568 crore per MHz, 43 per cent lower than Rs 11,485 crore set in the 2016 auction.

The government, which did not auction any spectrum in 2017-18 and 2018-19 fiscal years, wants to hold the country’s biggest auction of over 8,000 MHz of airwaves this year.

In August 2018, Trai said the 3,300-3,600 MHz band, expected to be the primary band for 5G services, should be auctioned as a single band and in blocks of 20 MHz each at Rs 492 crore per MHz.