Telecom Commission Pegs 900MHz Spectrum Base Price 23 Percent Higher

Inter-ministerial panel Telecom Commission has recommended a base price of Rs. 3,693 crores per megahertz for the premium 900MHz frequency band, about 23 percent more than what regulator Trai had suggested for the same for the spectrum auction in February.

The commission has finalised a base price of Rs. 3,646 crores per MHz for CDMA band, nearly 17 percent higher than the price suggested by Trai.

"The Telecom Commission has recommended that per megahertz price of spectrum in 900MHz band should be Rs. 3,693 crores, 1800MHz should be Rs. 2,191 crores and 800MHz be priced at Rs. 3,646 crores," an official source told PTI.

Trai had recommended that base price for 900MHz band price be kept at Rs. 3,004 crores per MHz, for 1800MHz at Rs. 2,138 crores and for CDMA spectrum at Rs. 3,104 crores.

The commission in its meeting yesterday finalised the base prices for spectrum auction early next year. The recommended base prices now would be placed before Telecom Minister Ravi Shankar Prasad for final approval and after that Cabinet might be approached for certain issues.

Auction of spectrum in 900MHz band would be held for 18 telecom circles and buying one MHz in each of these circles would cost Rs. 3,693-crores to the bidder.

Similarly, spectrum in 1800MHz band is being auctioned in 20 circles while 800MHz band (CDMA) spectrum is on pan-India basis.

The auction is to be conducted for airwaves in 900MHz held by existing telecom operators Airtel, Vodafone, Idea Cellular and Reliance Communications through their licences that are expiring in 2015-16.

In the 900MHz band about 184MHz of spectrum is likely to be auctioned. In 1800MHz, 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 auction.

However, government wants to keep 8.2MHz of spectrum as Defence band which leaves only 104MHz spectrum available for auction.

In case CDMA spectrum, government has proposed to auction spectrum in about 11 out of 22 service for which there were no bids received in March 2013 auction due to high base price.