Conduct auction when there is sufficient spectrum: GSMA

Global telecom body GSM Association today said the next round of auctions in India should be conducted only when adequate spectrum is available in the key bands.
GSMA said that although it fully supports the auction plans suggested by sectoral regulator TRAI, the government should reconsider its approach to the treatment of India's mobile operations so as to ensure that users do not suffer any breaks in service.
"The next round of auctions should only be conducted once there is sufficient spectrum available for mobile in all key spectrum bands, namely 800MHz, 900MHz, 1800MHz and 2100MHz," GSMA Chief Regulatory Officer Tom Phillips said in a statement.

The government should accelerate the migration of non- mobile users from the 2100 MHz band, in particular the defence industry, so the spectrum can be made fully available for 3G mobile communications, in line with international standards, he said.
In the 900 Mhz band, about 184 Mhz of spectrum is likely to be auctioned. In 1800 Mhz, government has proposed to auction 104 Mhz of spectrum which includes spectrum held under licences that are expiring in 2015-16 and unsold airwaves in February auction.
GSMA said next year's spectrum auction is particularly crucial for India's mobile industry and, if handled badly, could have damaging consequences.

"Failure of the existing operators to retain their current spectrum, which is due to be relicensed as part of the auction process, would not only jeopardise their businesses, but threaten the continuity of the vital mobile services they provide to citizens across the country," Phillips said.

Governments around the world are increasingly cautious of setting high reserve prices, GSMA said, adding that the recent auction conducted by the Brazilian government failed to secure bidders for all the bands offered.
The telecom body said it is widely accepted that high reserve prices do not lead to higher final auction receipts, but instead to market distortions that threaten the ability of bidders to invest in their networks.

"Although high auction prices may generate short term revenues for the government, in the longer term, they lead to higher tariffs and reduced coverage," it added.
TRAI has suggested 10 per cent higher base price for the next round of spectrum auction in the 1800 Mhz band. It has recommended Rs 2,138 crore per Mhz for the 1800 Mhz band and Rs 3,004 crore per Mhz for the premium 900 Mhz band.
"By 2017, around 250 million of 1.1 billion of India's mobile connections are estimated to be either 3G or 4G. We trust that India's new leadership will make sufficient, affordable spectrum available, to realise this forecast. With so much at stake for India's citizens and its economy, we cannot afford to fail," GSMA added.