Telecom Commission for Completing Spectrum Auction by February 28

"Telecom Commission has decided Chairman of the panel i.e. Secretary, DoT is authorised to recommend the time line for auction process with condition that it would be desirable for the auction be concluded by February 28, 2015," an official source said. An inter-ministerial committee formed to work on modalities of spectrum auction has suggested to start bidding rounds from February 3.

The government expects to garner a minimum of Rs. 9,355 crore from auction of three sets of spectrum band - 800MHz,currently being used for CDMA services, while the other two sets of band, 900MHz and 1800MHz, are being used for GSM-based mobile services by leading companies like Airtel, Vodafone, Idea Cellular and Uninor. The spectrum auction is to be conducted for radiowaves in 900MHz held by existing telecom operators - Airtel, Vodafone, Idea Cellular and Reliance Communications - as their licences are expiring in 2015-16.

In the 900MHz band, about 184MHz of spectrum is likely to be auctioned. In 1800MHz, the government has proposed to auction 104MHz of spectrum which included spectrum held by licences that are expiring in 2015-16 and unsold airwaves in February 2014 auction.

The DoT has over 130 days to meet the deadline decided by the panel. The February 2014 auction were concluded in about 65 days time from the date Cabinet decided on base price of spectrum for the auction. This was possible as DoT had selected auctioneer before issuing notice to invite bidders.

Telecom regulator Trai expects that bids for spectrum may go sky high only if these sets of airwaves are put up for auction due to lower availability of spectrum compared to the needs of the industry and cut-throat competition.

The Telecom Commission in its meeting on October 15 had decided on payment terms for the auctioneer - agency which will operate the auction process and make required software for conducting it.

In parallel, the DoT has to work on rules for auction based on which auctioneer will design software. The Telecom Regulatory Authority of India on October 15 released its recommendation on valuation of spectrum in 900 Mhz and 1800MHz band for next round of auction.

Telecom Regulatory Authority of India recommended a price of Rs. 2,138 crore per megahertz for the 1800MHz band. It also suggested a price of Rs. 3,004 crore per Mhz for the premium 900MHz band, in which mobile signals covered about twice the area than done in the 1800MHz band.

The government has set a total revenue target of Rs. 45,471 crore from communication services, including proceeds from the three sets of spectrum frequencies and related charges in this financial year. The receipts under the same head were Rs. 40,847.06 crore in 2013-14, according to the revised estimates.