India’s Telecom Commission has cleared the largest ever spectrum auction. Expected to be launched in July, the tender will also include the 700 MHz band for provision of 4G services, ET reports, citing an unnamed senior official. The base price for the 700 MHz band has been set at INR 114.85 billion a unit, as suggested earlier by regulator TRAI. "All spectrum will be auctioned, at the same prices recommended by Trai, even in the 700 MHz band", the senior official said. According to the same source, harmonisation of spectrum will be done before the auctions start. This will add 200 MHz to the 2,142 MHz that has been already cleared for sale, making it highest ever quantum of airwaves put on auction, he added.
According to another unnamed person familiar with the matter, the Department of Telecom (DoT) backs a flat SUC levy of 4.5 percent, which it believes is revenue neutral. The current structure involves multiple rates depending on whether the spectrum is auctioned or not, on grounds that segregation of revenue based on multiple spectrum bands for delivering 4G-LTE services would be a huge challenge. "The final decision on SUC will be taken before the July auctions", the source said.
The Telecom Commission has also rejected the Telecom Regulatory Authority of India’s (Trai) recommendations on an easier payment structure aimed at reducing the financial burden on operators. Winners of spectrum in frequency bands above 1 GHz - 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz will have to make an upfront payment of 50 percent of the winning bids, compared with 33 percent earlier, with the balance to paid over 10 equal annual installments after a moratorium of two years after the initial payment. Payment terms for winners of sub 1 GHz bands - 700 MHz, 800 MHz and 900 MHz bands will remain unchanged, namely 25 percent upfront with the rest to paid in similar terms as other bands, the person added.
The Telecom Commission’s decisions have to be approved by the Cabinet.
