New players invited to bid in India 2G auctions - Mobile World Live

New players invited to bid in India 2G auctions

24 APR 2012

The auction of 2G spectrum in India, brought about by the cancellation of 122 2G licences by the Supreme Court in February, is likely to welcome new operators, following recommendations by the Telecom Regulatory Authority of India (TRAI).

Following a period of consultation, the TRAI has recommended that the spectrum auctions should be open to all operators holding CMTS, UAS and unified licences and new entities. If a new entity is successful in securing a licence, the TRAI recommends that they take either a national or state-level licence.

The starting price for nationwide 1,800MHz licences will be INR36.22 (US$689.6 million), reports Dow Jones Newswires, with 800MHz spectrum starting at INR72.44.

These prices are significantly higher than was originally charged for the 2G licences in 2008, in a process that was deemed by the Supreme Court to have lost the Indian government large amounts of income.

The welcoming of new entrants and higher licence prices could make things tougher for incumbent operators due to increased competition. The Cellular Operators Association of India and the Association of Unified Telecom Service Providers of India said the suggestions are "arbitrary, regressive and inconsistent," reports Dow Jones Newswires.

“Moreover, it will also affect the investors' already shaken sentiments as it will prove to be an impediment for operators to invest and expand services," Dow Jones Newswires cited the trade bodies as saying.

The TRAI also recommends a simultaneous multiple round auction format, in which every licence is available for bidding at the same time and organisations can bid on multiple licences at the same time.

The Supreme Court cancelled the 2G licences after it deemed the process by which they were allocated in 2008 to be irregular. Operators with the licences were allowed to continue operating for a further four months before a new auction would be held to reallocate spectrum.

Despite there being a new auction for 2G licences in the pipeline, some foreign players – including UAE-based Etisalat and Bahrain’s Batelco, which owns S Tel – have already announced plans to exit the Indian market.

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Tim Ferguson

Tim joined Mobile World Live in August 2011 and works across all channels, with a particular focus on apps. He came to the GSMA with five years of tech journalism experience, having started his career as a reporter... More

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