New Delhi: GSM mobile operators today said the reserve price for 900 MHz in the forthcoming spectrum auction should be same as that for the 800 MHz band, used by CDMA players, because both the bands have similar propagation characteristics.
“We propose that reserve price of 800 MHz band as finally accepted by the government based on the Trai’s recommendations dated February, 2014 shall be used for 900 MHz band also,” Bharti Airtel said during an open house session on spectrum pricing for licences expiring 2015-16.
The Telecom Regulatory Authority of India had recommended a pan-India reserve price of Rs 2,685 crore per megahertz for 800 MHz band, used for offering CDMA services.
The GSM players were of the view that 800 MHz and 900 MHz spectrum have similar propagation characteristics and are being used for the deployment of broadband technologies such as 3G and LTE.
“The coverage in 900 MHz is roughly double that in 1800 MHz. The reduction in capital and operational expenditure could be as much as 40 per cent. Operations in the 800 MHz band enjoy similar advantages,” Vodafone said.
On the reserve price for 1800 MHz band, most of the telecom players unanimously said base price recommended by the Authority in September 2013 may be used for the next auctions as well.
“However in the case of those services areas where auctions closed at reserve price, the reserve price may be reduced by 20 per cent,” the telecom operators said.
As per Trai, 184 Mhz of spectrum in 900 MHz band and 104 MHz in 1800 Mhz band can be put up for the auction.
The government, in its Budget Estimates for the current financial year, 2014-15, has projected minimum revenue of Rs 9,355 crore from auction of 800 Mhz as well as the 900 Mhz and 1800 Mhz bands.
In December 2015, 4 licences of Bharti Airtel, 7 each of Idea Cellular and Reliance Telecom and 6 of Vodafone will complete their 20-year term and would require renewal.
The companies can renew their licences by paying a fixed fee but for continuing mobile and other wireless services they will need to buy spectrum afresh through auction at market determined rate. By April 2016, two more permits of Bharti and Idea will come up for renewal.
The 10-day long auction held in February this year gave the government over Rs 61,162 crore, far exceeding the target.
Eight telecom firms had bid for 900 Mhz and 1800 Mhz