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Pricing of 700 MHz spectrum band expensive: Sunil Bharti Mittal

Days ahead of start of the country's largest ever spectrum auction, Bharti Airtel Chairman Sunil Bharti Mittal today said the pricing of 700 MHz frequency band is "very expensive".

By: | New Delhi | Published: September 21, 2016 9:28 PM
sunil mittal “All I can say, is that it is very expensive,” Mittal said when asked about his views on the pricing of the spectrum in the premium band. (Reuters)

Days ahead of start of the country’s largest ever spectrum auction, Bharti Airtel Chairman Sunil Bharti Mittal today said the pricing of 700 MHz frequency band is “very expensive”.

“All I can say, is that it is very expensive,” Mittal said when asked about his views on the pricing of the spectrum in the premium band.

He, however, declined to comment on whether or not his company will place bids for the 700 MHz band, which is considered as the most efficient among telecom frequencies as the estimated cost of providing service through it is about one-third of 3G under the 2100 Mhz band.

Bharti Airtel has submitted an Earnest Money Deposit or EMD of Rs 1,980 crore with Telecom Department ahead of the upcoming auction of airwaves.

This is the first time that government will auction the 700 Mhz band.

Last week, seven telecom operators deposited Rs 14,653 crore as earnest money for the auction, with Reliance Jio alone submitting Rs 6,500 crore.

As per the information released by the Department of Telecom, with Rs 6,500 crore EMD, the Mukesh Ambani-led firm is eligible for placing bids in any of the 22 telecom circles in the country and in any spectrum band.

Vodafone India has submitted EMD of Rs 2,740 crore and Idea Cellular Rs 2,000 crore. These two companies as well as Bharti Airtel are eligible for bidding in any circle.

Tata Teleservices has submitted EMD of Rs 1,000 crore, Reliance Communications Rs 313 crore and Aircel Rs 120 crore.

Earnest Money Deposit or EMD is indicative of a company’s strategy to bid in specific circles and spectrum bands. It gives them eligibility points with regard to those circles.

As per DoT information, Reliance Jio is only company which has potential to buy spectrum in premium 700 Mhz at floor price in most of the circles, as a pan-India bidder for 700 Mhz spectrum needs to have EMD of Rs 5,610 crore.

A firm opting to buy spectrum in 700 MHz band will need to shell out a minimum of Rs 57,425 crore. Total spectrum worth Rs 4,01,975 crore in 700 MHz band is being put up for auction.

Mobile frequencies in all bands — 700 Mhz, 800 Mhz, 900 Mhz, 1800 Mhz, 2100 Mhz and 2300 Mhz — will be put on the block in the upcoming auction. All the radiowaves being put up for auction can be used for providing high-speed 4G services.

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