Weeks before India’s biggest spectrum auction, Telecom Minister Manoj Sinha today said telcos not buying airwaves will not be able to meet competition and anticipated an enthusiastic participation.
In an interview to PTI, the minister said that given the intense competition in the sector, companies will need spectrum to give good quality service, increase revenue and maintain a good image.
“With the kind of competition that exists in the market, whosoever has to give quality service will need spectrum. It is required for increasing revenue, customers, for good data service, voice calls, and for good image also. Those who will not buy spectrum, will not be able to meet these parameters. Therefore, I believe people will participate (in the auction) and participate with enthusiasm,” Sinha said.
He expects Telecom Ministry to meet revenue target set by Finance Ministry from the communications sector for the current financial year.
“How much we will get from auction that we will get to know after October 1 (auction) but I feel that we will be able to meet target given by Finance Ministry to this ministry,” Sinha said.
The Finance Ministry in the budget pegged the revenue at Rs 98,995 crore from telecom sector which includes Rs 64,000 crore from the auction of about 2,354.55 Mhz of spectrum and rest from various levies and services in the telecom sector this financial year.
Government will start from October 1, mega spectrum auctions in which mobile frequencies in all bands — 700 Mhz, 800 Mhz, 900 Mhz, 1800 Mhz, 2100 Mhz and 2300 Mhz, will be put on the block.
The total value of airwaves being put for auction at base price amount to about Rs 5.63 lakh crore. All the radiowaves being put for auction can be used for high speed 4G services.
“This is mega-auction and there are many types of spectrum that will be auctioned. Some people are saying about 700 Mhz (band) prices. When I took charge the prices were already decided. I don’t see there is any need to give an opinion on it. I expect auction of 700 Mhz as well. If it does not happen then we will see later,” Sinha said.
This is the first time government will auction premium airwaves in 700 Mhz band. This band is considered to be the most premium of all, as cost of providing service in it is one-third of 3G service in 2100 Mhz band.
The 700 Mhz band alone has potential to fetch bids worth Rs 4 lakh crore if all spectrum in it gets sold at the base price, although most telecom analysts have predicted a muted response in this band given the exorbitant pricing.