Telecom regulator reiterates its recommendations for airwave auction

India's telecom regulator Monday said there will be no change in the recommended reserve prices for spectrum in the 900 MHz and 1800 MHz bands for the upcoming auction scheduled in February 2015.

"The constrained supply of spectrum poses a real threat to the continuity of services being provided to millions of subscribers by expiry licensees. Also, the non-availability of sufficient spectrum is the biggest impediment to the realisation of the stated goals in National Telecom Policy 2012 for broadband proliferation," the Telecom Regulatory Authority of India (TRAI) said in a statement.

It reiterated that dialogue need to be held at the level of the finance, communications and IT and the defence ministers to ensure the availability of additional spectrum for commercial use.

The TRAI Oct 15 recommended around a 10 percent hike in the reserve price for 1,800 MHz band spectrum auction compared to the winning price in the February 2014 sale.

The inter-ministerial panel, Telecom Commission, Nov 7 referred back the spectrum valuation and pricing proposal for the upcoming auction to the regulator for review.

On Nov 14, the Department of Telecommunications sought clarifications on certain matters.

The regulator reiterated that steps should be taken to make available spectrum in the 900, 1800 and 2100 MHz bands by taking back 1.2 MHz of 900 MHz spectrum from BSNL, utilising idle 1800 MHz spectrum in the defence band and vacating spectrum held in excess of 20 MHz by defence in the 1800 MHz band.

"We are very gratified that chairman, TRAI has taken such a bold step of sticking to the earlier recommendations. This is absolutely essential for the industry," Rajan S. Mathews, director general, Cellular Operators' Association of India - the GSM body - told IANS.

In December 2015, seven licenses each of Idea Cellular and Reliance Communications, four licenses of Bharti Airtel and six licenses of Vodafone will complete their 20-year term after which they should be renewed.

TRAI has set a price of Rs.3,004 crore per mega hertz for bandwidth to be auctioned in 18 service areas for the more efficient 900 Mhz band and Rs.2,138 crore per mega hertz for the 1,800 MHz band. The auction is expected to be held in February 2015.

In the 1,800 MHz band, 20 circles are going for auction, while in the 900 MHz band 18 circles will be up for sale.

The recommendations said spectrum should be put to auction in a block size of 2x200 KHz in both the 900 and 1,800 MHz bands.

The revenue target set by the government in 2014-15 budget from spectrum auction is Rs.45,471 crore.

In 2013-14, the total receipts from auction were of the order of Rs.40,847.06 crore. In February 2014, in a 10-day auction of 900 MHz and 1,800 MHz, the government mopped up Rs.61,162 crore.