All except Videocon, Loop apply to bid for 2G spectrum

Leading telecom companies (telcos) including Bharti Airtel, Vodafone, Idea Cellular and Reliance Jio Infocomm on Wednesday submitted their applications to participate in the 2G spectrum auction on February 3.

Uninor, Tata Teleservices, Reliance Communications and Aircel are among the applicants.

Only Loop and Videocon among the major telcos did not submit their applications.

The government will auction 403 MHz of pan-India spectrum in the 1,800 MHz band and 45 MHz spectrum in the 900 MHz band. The government expects to exceed its budgeted target of about Rs 11,343 crore from the February 3 auction.

The 1,800 MHz band is being put up for auction following the Supreme Court order that the government sell all spectrum that was freed from the cancellation of 122 licences on February 2, 2012 in the 2G spectrum allocation case.

The 900 MHz is being auctioned in three metros – Delhi, Mumbai and Kolkata – as the current licences of operators (Airtel, Vodafone and Loop) will expire in November.

The February 3 auction is expected to decide the fate of the fund-starved Indian telecom industry.

Wednesday was the last date to submit the applications. Pre-qualification of bidders will be done on January 25. Telcos can withdraw their applications by January 27. The final list of bidders will be released on January 29. Thereafter, a two-day mock auction will take place on January 30 and 31.

MF Farooqui, secretary of the department of telecommunications or DoT, said the auction will be held as per schedule, thus ruling out talk of possible delays. DoT, he said, will resolve any issues raised by operators well before the auction day.

Arvind Bali, CEO and director of Videocon Telecom, said the company was keen to bid for the 900 MHz spectrum for Delhi and additional 2 MHz spectrum each in Punjab and MP circles on the 1,800 MHz band.

“But it was felt that 4G LTE (long-term evolution) rollout would be a catalyst for making a differentiation. However, worldwide, the 4G LTE ecosystem is not that evolved in the 900 MHz space. That makes the cost of deployment very expensive, thus making 900 MHz not suitable for 4G. We feel that the 4G ecosystem in 900 MHz band should evolve in the coming years and that should be the time we will look at options,” he said in a statement.

In Punjab, 25 out of 92 blocks are not available in Ludhiana and Amritsar.

There Videocon was “facing a little congestion, so we’d rather deploy more sites than acquiring spectrum”, Bali said.

Instead, Videocon will invest on services in Uttar Pradesh East, Uttar Pradesh West and Bihar Telecom circles where it already has airwaves. Videocon officials are in China for talks with technology partners for the rollout roadmap, he said. On the other hand, Loop Telecom, on Wednesday filed an application with the Telecom Disputes Settlement and Appellate Tribunal or TDSAT for extension of its 900 MHz Mumbai licence. Loop expects a positive response, and hence, it said, it has decided not to participate in the February 3 auction.

In the last round of auction held in March 2013, none of the Global System for Mobile (GSM) communications operators had bid for radiowaves, citing high reserve or base price.

The Cabinet has fixed the base price for sale of spectrum in the 1,800 MHz band for pan-India at Rs1,765 crore per MHz, about 26% lower than in the March sale.

For the 900 MHz band, it approved a rate up to 53% lower than the previous auction price. It is Rs360 crore per MHz for Delhi, Rs328 crore for Mumbai and Rs125 crore for Kolkata.

Together, the 1,800 MHz and 900 MHz airwaves are valued at Rs48,685 crore.

The government expects to garner Rs40,000 crore in the form of spectrum revenue this fiscal.