Over Rs. 1 Lakh Crore Committed in Telecom Auction, Small Fall in Net Bids

The government received commitments totalling "over Rs.1 lakh crore" from telecom operators at the end of bidding on Friday, the ninth day of radio frequency spectrum e-auctions, but there was a marginal drop in the collective value of the highest bids across bands to Rs. 101,423 crore from Rs. 102,057 crore a day earlier.

"The bidding is taking place in all bands. Brisk bidding was seen on 9th day of bidding, with activity requirement set at 100 percent. There is robust bidding going on in all bands, that is, 2100MHz, 1800MHz, 900MHz and 800MHz bands," the department of telecom said in a statement in Delhi.

The ninth day saw six rounds of fresh bidding.

"At the end of the 55th round, over 87 percent of the spectrum has been provisionally allocated to bidders. The provisional amount committed by bidders at the end of the 55th round is over Rs.1 lakh crore," DoT said.

It also mentioned that the collective value of the highest bids was at Rs. 101,423 crore on Friday.

The statement further added: "Majority of service areas are going at a premium over reserve price. The competitive bidding is expected to continue. There is still spectrum, which is yet to be sold. Bidding would recommence tomorrow, that is, March 14, 2015 at 9 a.m."

The eighth day (Thursday) saw total bids worth Rs. 102,057 crore after 49 rounds.

The commitments come over and above the Rs. 200,000 crore that India Inc has already bid under the two phases of auctions for award of coal blocks. But the proceeds from this auction will go to the respective state governments over 30 years.

The central government has budgeted for Rs. 43,161.72 crore from e-auctions of spectrum for the current fiscal while the reserve price for the entire spectrum on offer in the four bands, across India, was around Rs. 80,000 crore.

The bids so far have well exceeded these numbers.

The maximum bids of 78 were received for Tamil Nadu circle with a winning amount of Rs. 45 crore per block in the 1800MHz band. However, this circle saw 17 less bids.

The second highest bids of 75 were received for Punjab circle with a winning amount of Rs. 72.15 crore per block in the 900MHz band. This circle also saw three less bids.

The eight telecom service providers participating in the auctions are Reliance Communications, Reliance Jio, Bharti Airtel, Vodafone India, Tata Teleservices, Uninor, Idea Cellular and Aircel.

They have submitted earnest money of Rs.20,435 crore, which is two and a half times what had been called for.

The total spectrum put up for auction is 103.75MHz in 800MHz band, 177.8MHz in 900MHz band and 99.2MHz in 1,800MHz band for second generation (2G) telephony. The government has also put up 5MHz in the 2,100MHz band for third generation (3G) telephony.

A reserve price of Rs. 3,423 crore per MHz was fixed for 800MHz frequency, Rs.3,399 crore for 900MHz band and Rs.1,425 crore for the 1,800MHz band. The government also fixed a reserve price of Rs. 3,511 crore per megahertz for the frequency for 3G spectrum.