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2G auction process to begin by Nov

Source : BUSINESS_STANDARD
Last Updated: Tue, Aug 28, 2012 04:03 hrs
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The Department of Telecommunications (DoT) on Monday issued a fresh document saying it will start the 2G auction process by November this year. The Information Memorandum (IM) issued by DoT said the department would start inviting applications from interested companies from next month-end. This gives DoT three months' time to complete the auction process, as the Supreme Court on Monday extended the time for completion of auction till January 11, 2013.

Earlier, the SC had set August 31 as the deadline. However, the government had requested for an extension to November-December. The IM is one of the most crucial auction documents, which gives details of the auction rules, the amount of spectrum available and the base price for each of the 22 circles.

The timeline
The IM stated prospective bidders should apply by October 19. A formal notice inviting applications will be issued by DoT by September 28.

As per the IM, auction for GSM spectrum in 1800 MHz band will start on November 12, the auction of CDMA spectrum in 800 MHz will begin two days after the completion of GSM spectrum auction. Mock auctions will be held on November 7 and 8.

Reserve price
The IM also outlined details of the reserve price per area and the amount to be deposited for per service area per block. Delhi has the highest reserve price at Rs 693 crore and Rs 900 crore for GSM and CDMA, respectively. The next most expensive circle is Mumbai at Rs 678 crore and Rs 881 crore, respectively.

Assam, rest of northeast and J&K are some of the circles where the reserve price is below Rs 11 crore in GSM and CDMA.

Base price for pan India spectrum is Rs 14,000 crore for 1800 MHz band and 1.3 times higher for the 800 MHz band.

Number of blocks
In 1800 MHz band, a minimum of eight blocks each of 1.25MHz (10MHz) will be put up for auction in all the service areas. In addition, provision will be made for spectrum up to 3 blocks each of 1.25MHz (3.75 MHz), wherever available, after reserving spectrum for refarming against allocation in 900 MHz band for licences expiring in 2014 to 2016.

Existing operators will be allowed to take maximum 2 blocks of 1.25MHz each in each area. New entrants will have to bid for minimum four blocks of 1.25MHz in each service area. New entrants will be allowed to bid for an additional block of 1.25MHz in each service area. In 800 MHz band, a minimum of three blocks each of 1.25MHz (3.75MHz) will be put up for auction in all service areas.

A provision will be made for spectrum of one block of 1.25MHz, wherever available, for topping up the three blocks of spectrum put up for auction, to meet the requirement of new entrants, if such an exigency arises, and to ensure that the entire quantum of spectrum of 3.75MHz in each service area is allocated in the auction.

Existing operators will be allowed to bid for 1 block of 1.25MHz in each area. New entrants will be required to bid for minimum two blocks each of 1.25MHz in each area. New entrants will also be allowed to bid for an additional block of 1.25MHz in each service area.

Blocks available in a circle
Though in 1800 MHz band, eight blocks each of 1.25MHz (10MHz) is available in all service areas, additional spectrum beyond the eight blocks are not available in Delhi, Mumbai, Rajasthan, Uttar Pradesh (east), Punjab and Gujarat.

In the 800 MHz band, no spectrum is available in Rajasthan service area.


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