No new spectrum in next Indian auction after DoT/TRAI disagreement

No new spectrum in next Indian auction after DoT/TRAI disagreement

India’s Department of Telecommunications (DoT) is not putting any new spectrum on sale in the upcoming January auction. The focus will be on unsold spectrum only.

The unsold spectrum is said to be worth about Rs2.65 lakh crore (just under US$32 billion). It will be sold at the same base prices as last year’s auction.

It seems that the auction has to go ahead soon as some licenses owned by Bharti Airtel and Vodafone Idea are set to expire in February. However, regulator TRAI has not announced any reserve price for new spectrum bands, so they will not be included.

According to India’s Economic Times news service, the DoT did want to auction both unsold spectrum and new spectrum at frequencies ranging from 37-37.5 GHz, 37.5-40 GHz and 42.5-43.5 GHz.

However, TRAI hasn’t set a reserve price for 37GHZ, so it can’t be sold. Thus, with no plans to reset prices on unsold spectrum, DoT has been told it should auction the existing bands without waiting for TRAI’s recommendations.

The last auction saw sales across 600MHz, 700MHz, 800MHz, 900MHz, 1800MHZ 2100MHz, 2300MHz, 2500MHz, 3300-3670MHz and 24.25-28.5 GHz bands. However, most sold at  base price. Only 1800MHz in Uttar Pradesh (East) exceeded expectations.

It seems that TRAI had argued for a fresh spectrum valuation exercise on unsold spectrum once every three years, with new spectrum valuation addressed when it is put on sale. The DoT wanted the valuation more often. TRAI disagrees.

Which may explain the present situation. The Economic Times says that analysts don’t predict a very competitive sale as only two buyers, Reliance Jio and Bharti Airtel, are effectively involved. Vodafone Idea’s ongoing financial issues may make it difficult to buy more than the bare minimum it requires.

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