 "Idea buys Videocon's spectrum for Rs 3,310 cr")
The Telecom Regulatory Authority of India (Trai) has released a consultation paper for determining the modalities, including reserve price and quantum of spectrum, for the next round of auctions which are expected to be held in the current financial year.
Trai has sought comments from stakeholders for valuation and reserve price of spectrum in seven bands - the 700, 800, 900, 1800, 2300, 2500 and 2100 MHz bands.
Comments have also been invited for quantum of spectrum to be auctioned, spectrum block size, spectrum cap, rollout obligations and methods to be used for valuation of reserve price.
The regulator also sought to clarify its position over reported delay in the paper, which might delay the auction. It said the information sent by DoT on July 9 was not sufficient and, on July 24 it had sought information that was critical for preparing the consultation paper.
"Written comments on the paper are invited by December 21, and counter-comments by December 28. As the issue has to be decided urgently, no further extension of time will be granted," the regulator said.
The auction is conducted by the DoT after receiving price recommendations from Trai. It takes between four to six months to start the auction process after the recommendations are approved by the Cabinet.
Though the time of the next auction was not indicated in the paper, the regulator did emphasise that stakeholders, while commenting about reserve price of the upcoming auction, must take into account the time gap between the auction in March 2015 and the next one, even if the gap is less than a year.
Trai also sought the views of stakeholders about spectrum cap before the auction. As per the spectrum cap rule, a telecom firm cannot own more than half of a particular band in a circle, and its total spectrum possession must not cross 25 per cent in a particular area.
The 700 Mhz band, which the regulator said is ideal for rolling out the 4G network, is, however, kept out of the spectrum cap purview.
Further, it sought to know whether the cap provision should be done away with, since the restriction might curb competition during the auctions of higher frequency spectrum.
The regulator has also invited opinions of stakeholders about the participation of internet service providers in the auction of higher frequency bands such as the 2,300 and 2500 MHz bands.
"If spectrum cap in each band is retained, then the existing service providers in 2,300 and 2,500 MHz bands will not be able to acquire additional spectrum blocks in these bands as they will exceed the 50 per cent cap in this band. As the eco-system in this band is still not fully developed, it is less likely that any new entrant will come in this band. Doing away with spectrum cap in each band - barring the 700 Mhz band - and an overall spectrum cap will help in more competition in these bands," the paper said.
Revenues from spectrum auction are important to bridge the fiscal deficit. In March this year, the government had raised Rs 1.1 lakh crore from the auction of spectrum.
In the Budget for this fiscal, the government had pegged revenue from communication services, that include upfront realisation from spectrum sale and licence fee, at Rs 42,865.62 crore for the current fiscal.
TRAI SEEKS COMMENTS
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What should be the ratio between reserve price for auction and the valuation of the spectrum in different bands?
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Should the realised prices in the March 2015 auction for 800/900/1800/2100 MHz spectrum bands be taken as the reserve price for respective spectrum bands
