Spectrum auction: Telcos to get more airwaves this time

The government is likely to put maximum possible quantum of spectrum in the next auction, likely to be conducted within the current fiscal year. According to data available with the Department of Telecommunications (DoT), as much as 184 MHz of radio wave will be auctioned across 18 telecom circles in the 900 MHz band and 104 MHz of spectrum will be put up for sale in 17 telecom zones in the 1800 MHz band.

The government will have to conduct the auction as 900 MHz-band licences in these service areas are completing their licence period and will come up for renewal in 2015 and 2016. A few licences in the 1800 MHz band are also coming up for renewal during this period.

Operators, who will have to renew their licences, together hold about 172 MHz in the 900 MHz band and about 26 MHz in the 1800 MHz band. In February 2014, the DoT hadauctioned 385.2 MHz of spectrum in 1800 MHz band of which 307.2 MHz were sold. It had sold all spectrum in the 900 MHz band in Mumbai, Delhi and Kolkata circles in the February auction.

Besides the fact that theincumbent operators need to renew licences, telecom operators have beenconstantly looking to increase their spectrum holding in each circle to boost their potentially remunerative high-speed data services. While companies like Bharti Airtel and Idea Cellular would try to retain back spectrum in the circles where their licences are expiring in the 900 MHz band, they are likely to pick up spectrum in the 1800 MHz band in all those circles.

All the incumbent players have done the same thing in the previous auction that was conducted in February. The DoT has already asked the Telecom Regulatory Authority of India (Trai) for its recommendations on valuation and pricing of spectrum in all the circles where it would have to conduct auction. There are about 29 licences that would expire across 18 circles in 2015-16.

Meanwhile, the Government, in its interim Budget in February, had said that it aimed to generate revenue of Rs 38,954.02 crore from communication services during fiscal year 2014-15. This includes receipts from spectrum sale, licence fees and one-time spectrumcharges.The Government has mopped up Rs 61,162.22 crore in the auction conducted in febryary this year. Of this, the Government was to get Rs 18,296.32 crore during financial year ended March 2014, about 61% higher than the Budget target of Rs 11,343 crore.