New Delhi: The Union Cabinet today approved auction of 2251.25 MHz spectrum with total valuation of Rs. 3,92,332.70 crore at reserve price for providing commercial mobile services. It gave green signal to Department of Telecommunications to conduct spectrum auction through which spectrum will be assigned to the successful bidders. The auction will be for spectrum in 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz frequency bands, which would be offered for assignment for validity period of 20 years.
By winning right to use spectrum through the auction, incumbent telecom service providers will be able to augment their network capacity whereas new players will be able to start their services.
In the auction, bidders will have to comply with parameters and conditions such as block size in which bidders will be able to submit their bids, spectrum cap, for example, the maximum amount of spectrum that can be held by each bidder after the completion of the auction, roll-out obligations, payment terms etc.
Successful bidders may pay entire bid amount in one go (upfront) or may exercise an option to pay a certain amount (25% for spectrum won in 700 MHz, 800 MHz, 900 MHz bands or 50% for spectrum won in 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz bands) upfront and remaining amount in a maximum up to 16 equated annual instalments, after a moratorium of two years.
In addition to the bid amount, successful bidders will also have to pay 3% of the Adjusted Gross Revenue (AGR) excluding wireline services as spectrum usage charges for the spectrum won through this auction.
– globalbihari bureau
