Spectrum Auction Monday Feb 03,2014

The third round of spectrum auction started on Monday  Feb 03,2014 with 8 Telecom Companies in fray, from which the government expects to garner at least Rs 11,300 crore.

• Bharti Airtel
• Vodafone
• Reliance Jio Infocomm
• Idea Cellular
• Telewings (Uninor)
• Reliance Communications (RCom)
• Tata Teleservices and 
• Aircel 

will battle it out at the spectrum auction  from which the Govt expects to garner at least Rs 11,300 crore.

• Three companies, meanwhile, have been found to be ineligible for bidding in certain service areas. Vodafone, India, will not be  able to bid in seven circles
• RCom in eight and 
• Tata Teleservices in Delhi

The Department of Telecom (DoT) has put on the block around 385 MHz of radiowaves in the 1,800 MHz band, and 46 MHz in the 900 MHz band. 

DoT has reduced the quantum of spectrum to be sold in 1,800 MHz band in 10 circles, including Delhi, Kolkata and Mumbai, from about a total of 403 MHz planned earlier. 

The Govt has to conduct this third round of spectrum auction following a Supreme Court order in 2G case directing that all the radiowaves freed from the cancellation of 122 licences in February 2012 should be auctioned.

The Govt has fixed the base price for sale of spectrum in the 1,800 Mhz band for pan-India at Rs 1,765 crore per MHz, about 26 per cent lower than in the March 2013 sale
For 900 MHz band, the base price is 53 % lower than the previous auction price. It is Rs 360 crore per MHz for Delhi, Rs 328 crore for Mumbai and Rs 125 crore for Kolkata.

The Govt has set a target of Rs 40,874.50 crore for this fiscal from spectrum, including the auction amount, one-time spectrum charge and annual regular licence fee

As per the rules of the auction, every company has been given quota of 240 minutes(6 hours) to extend bid round.Normally 6-7 rounds take place in a day with each round of 60 minutes. There is a 20-minute break between the rounds

The licences of Vodafone and Bharti Airtel expire in November 2014 on completion of the 20-year period. Idea’s seven licences will expire in December 2015
It is must for Vodafone to get spectrum in Delhi, Mumbai and Kolkata; for Airtel in Delhi and Mumbai, and Loop Mobile in Mumbai for continuing operations because their licences are expiring in Nov 2014

The Telecom Disputes Settlement and Appellate Tribunal had on Friday Jan 31,2014 dismissed the operators’ plea and denied extension of their licences, saying the operators had for years been holding the spectrum in excess of the contracted quantum. It said the operators held licences in the most premium band on rates fixed in 2001.
The Telecom Disputes Settlement and Appellate Tribunal said it was satisfied with the reason based on which the Department of Telecom (DoT) had denied extension and had asked telcom companies to participate in the spectrum auction starting February 3,2014


The Telecom Operators had approached the Supreme Court for a stay on the spectrum auction and extension of their licences by another 10 years.
During the hearing, senior counsel A M Singhvi and Mukul Rohtagi, appearing for Vodafone and Bharti respectively, argued that the companies had a legal and contractual right to get extension of their licences. They said the companies were willing to pay a fair market-determined price for the spectrum already allocated to them, and hence there was no real need for an auction.

Stating that Telecom Companies cannot have a “monopoly of unlimited licence holding”, the Supreme Court on Sunday Feb 02,2014 rejected an appeal by Bharti Airtel, Vodafone, Loop and Idea for a stay on the spectrum auction which is scheduled to begin on Monday.
In a relief for the Govt, a Bench of Justices A R Dave and S A Bobde allowed an urgent hearing to the companies but refused to restrain the Centre from going ahead with the auction which is expected to raise Rs 49,000 crore.

The SC's refusal to stay the auction puts operators like Bharti Airtel and Vodafone, which hold substantial quantum of airwaves in the efficient 900 Mhz bands in Delhi, Mumbai and Kolkata, under pressure to bid aggressively to regain their bandwidth holdings.

Spectrum sale elicits bids worth Rs.50,000 cr Wed Feb 05,2014

 The Central Government has so far been ensured of at least Rs.50,000 crore from the ongoing sale of spectrum as the third day of the auction on Wednesday saw telecom companies still continuing to bid aggressively for 900 MHz band radio waves on offer in three metro circles of Delhi, Mumbai and Kolkata

Aggressive bidding was seen for the 900 MHz band in the three metros where licences of Bharti Airtel and Vodafone India will expire in November 2014

In the 900 MHz band, Wednesday saw spectrum price -

• in Delhi touching Rs.574 crore, up by 60 %
• in Mumbai Rs.563 crore, up by 71 %; and
• in Kolkata Rs.193 crore, up by 53%

Government sources said bids worth Rs.20,000 crore had been received for 900 MHz band and Rs.30,000 crore for 1800 MHz band

“Bids of around Rs.50,000 crore were received at the end of 21 rounds on [the] third day of spectrum auction…Besides 900 MHz band, demand for 1800 MHz in many circles also picked up today [Wednesday]. We will continue with [the] auction tomorrow,” Telecom Secretary M. F. Farooqui told

The Telecom Secretary also said the government would get at least Rs.15,000 crore in the current fiscal based on the bids received at the end of the third day. Successful bidders will pay 25 % of the winning price upfront.
The remaining will have to be paid in instalments till 2026.

The 2G spectrum auction concluded on Thursday Feb 13,2014 after 68 rounds of bidding

The Govt has said it will earn Rs. 61,162 crore from the 2G spectrum auction that ended after 68 rounds of bidding over 10 days
At Rs. 61,162 crore, the government's total revenue from the auction is much higher than its initial estimate of about Rs. 41,000 crore. The licences won today will be valid for a period of 20 years. The companies need pay only a quarter to a third of the winning auction price upfront and the remainder through to 2026

Winners in 900 MHz band

Area	Band (MHz)	Reserve Price/block (in Rs. crore)	Winning Bid (in Rs. crore)	Winners
Delhi	900	360	740.96	Bharti Airtel, Vodafone, Idea Cellular
Kolkata	900	125	194.63	Bharti Airtel, Vodafone
Mumbai	900	328	563.09	Bharti Airtel, Vodafone

Winners in 1800 MHz band
Mukesh Ambani-backed Reliance Jio bagged 1800 MHz band in 14 circles out of 22 on offer. This will help the company to not only offer data but also voice services in these regions. Reliance Jio had earlier won the rights to offer 4G broadband services across the country.

Area	Band (MHz)	Reserve Price/block (in Rs. crore)	Winning Bid (in Rs. crore)	Winners
Andhra Pradesh	1800	32.6	32.60	Bharti Airtel, Idea, Reliance Jio, Telewings Communications, Vodafone India
Assam	1800	1.4	7.22	Reliance Jio, Telewings Communications
Bihar	1800	7.4	8.62	Telewings Communications
Delhi	1800	43.8	72.80	Reliance Jio, Bharti Airtel, Vodafone India, Idea Cellular
Gujarat	1800	28.5	47.56	Reliance Jio, Vodafone, Idea
Haryana	1800	5.4	5.40	Idea, Vodafone
Himachal Pradesh	1800	1.2	1.20	Bharti Airtel
Jammu & Kashmir	1800	1	1.22	Aircel, Bharti Airtel
Karnataka	1800	31	31.00	Bharti Airtel, Vodafone, Idea, Reliance Jio
Kerala	1800	10.4	10.40	Idea, Vodafone, Bharti Airtel, Reliance Jio
Kolkata	1800	14.6	14.60	Vodafone, Bharti Airtel, Reliance Jio
Madhya Pradesh	1800	8.6	10.08	Idea, Reliance Jio, Bharti Airtel
Maharashtra	1800	34.6	58.07	Reliance Jio, Idea
Mumbai	1800	41.4	54.40	Bharti Airtel, Reliance Jio, Vodafone, Idea, Reliance Communications
North East	1800	1.4	1.40	Bharti Airtel, Reliance Jio, Idea, Aircel
Orissa	1800	3.2	3.20	Bharti Airtel, Reliance Jio
Punjab	1800	10.8	10.80	Bharti Airtel, Idea, Vodafone
Rajasthan	1800	5.2	5.20	Bharti Airtel, Aircel, Vodafone
Tamil Nadu	1800	41.6	41.60	Reliance Jio, Bharti Airtel
Uttar Pradesh (East)	1800	12.2	12.80	Vodafone, Telewings Communications, Aircel
Uttar Pradesh (West)	1800	12.4	18.99	Telewings Communications
West Bengal	1800	4.2	4.92	Reliance Jio, Aircel, Bharti Airtel

Note

The 3G auction in 2010 lasted for 34 days, while the auction in November 2012 lasted for 2 days and March 2013 auction lasted for only one day

In November 2012, bids worth Rs 9,407 crore were received for spectrum worth Rs 28,000 that was offered.

In March 2013, no GSM operators bid at the auction and only CDMA operator Sistema Shyam bought spectrum of about Rs 3,600 crore in eight of the 21 service areas.