Spectrum price: DoT panel for applying same method used in Feb

Disagreeing with TRAI approach, a DoT panel has suggested applying the same method used in the February auction for determining the spectrum base price in the next round of sale of radiowaves as well.

The DoT committee, formed to study TRAI recommendations on valuation and reserve price of 1800 Mhz-- widely known as 2G-- and 900 Mhz spectrum band for the next round of auction, has observed deviation from the approach used earlier by the regulator and logic given for it.

"The committee is of the view that the same approach for arriving at reserve price for auction of spectrum during February 2014 may be incorporated in the methodology for arriving at reserve price of 1800 Mhz," an official source said.

TRAI has suggested about 10% higher base price than what was received in February auction.

The committee has found that using the method suggested by will leads to about further 3-20% higher base price of spectrum across some circles compared to the rates suggested by the regulator.

The next round of spectrum auction is proposed to be held in February 2015 from which government is estimated to garner at least Rs 9,355 crore.

The DoT panel report is likely to be placed before the inter-ministerial panel, Telecom Commission, in its meeting scheduled for November 7 to discuss the minimum price of spectrum in the next round of auction.

Most of the spectrum that are proposed to be put up for sale are at present being used by Airtel, Vodafone, Idea Cellular and Reliance Communications across various parts of the country. These companies will need to buy back airwaves to continue their operations in areas where their licences are expiring in 2015-16.

The Department of Telecom (DoT) committee has also made similar suggestion for premium 900 Mhz spectrum in which telecom signals cover about two times more areas than signals transmitted in 1800 Mhz and therefore need fewer number of mobile towers.

The committee has also turned down TRAI's recommendation to take back 900 Mhz spectrum from state-run BSNL saying that DoT has no jurisdiction to take back spectrum from the public sector firm under licence condition and suggested regulator should review its suggestion.