No bidders in CDMA spectrum auction

In a blow to government plans to garner a minimum of Rs. 12,900 crore from sale of CDMA spectrum, Tata Teleservices on Monday withdrew its application for participating in the auction, two days after the only other bidder Videocon had walked out.

"Yes, they (TTL) have withdrawn," confirmed a Department of Telecommunications official.

The government has fixed minimum price of Rs. 14,000 crore for pan-India GSM spectrum auction slated for November 12 while the same for the CDMA spectrum will be 1.3 times of GSM spectrum price. This pegs the price of each block at Rs. 4,550 crore.

The government plans to auction only 3 blocks of 1.25 MHz each in 19 telecom circles. However, in Punjab and Andhra Pradesh circles, the government will auction only two blocks while there will be no auction for spectrum in 800 Mhz in Rajasthan circle.

So, a back-of-the-envelope calculation says the government should have earned a minimum of Rs. 12,928 crore from sales of CDMA spectrum in telecom circles.

According to sources, TTL had submitted applications to bid for spectrum in three telecom service area Assam, North-East and Jammu and Kashmir.

Earlier in February this year, the Supreme Court had cancelled 122 permits, including that of Tata Teleservices in three circles.

Videocon Group, which was the only other applicant for CDMA airwaves, had withdrawn its application on November 2.

The auction for spectrum in 800 Mhz band is slated to begin two days after the winners of 1800 Mhz band auction are declared.

Faced with a rising fiscal deficit, the government has been hoping to garner Rs. 40,000 crore from auction of spectrum (CDMA and GSM).

Prashant Singhal Partner in member firm of Ernst & Young Global said: "Bids in auction are expected to remain muted. It may fetch government somewhere around Rs. 15,000 crore. Value that government has fixed for airwaves is not real."