Expressing his doubts on the further need for spectrum, Sanjay Kapoor, Ex-chairman of Micromax on Friday said that with the on-set of 4G, India will need further towers and investments. He also told Bloomberg TV that the telecom industry is fast moving towards consolidation. There were no takers for the most-efficient yet priciest 700 megahertz band of airwaves and only 40 percent of the total on offer was sold in the spectrum auctions that took place recently. Earlier this week, global mobile industry body GSMA called upon the government to reconsider pricing of 700 MHz band. In a statement, John Giusti, Chief Regulatory Officer, GSMA, also urged the government to reassess the approach to spectrum auction reserve prices after India “failed” to sell any of the critical 700 MHz band last week.
The spectrum auction, which was touted as the largest sale of mobile airwaves, ended in a whimper, with just Rs 65,789 crore of bids coming in over five days as against an expectation of Rs 5.6 lakh crore. Nearly 60 per cent of airwaves, including premium 4G bands, remained unsold. Meanwhile, Bharti Airtel, Vodafone and Idea secured adequate 4G spectrum during the recently-concluded auction to counter Jio, making them more competitive to poach subscribers, analysts said. “We now believe that the top three telcos have adequate 4G spectrum to counter Jio, making it more competitive to poach subscribers. We now also see faster consolidation among smaller telcos, given lack of data spectrum,” Bank of America Merrill Lynch said in a report.
Market leader Bharti Airtel acquired 173.8 MHz spectrum in bands of 1800MHz, 2100 MHz and 2300 Mhz for Rs 14,244 crore in circles including Kerala, Assam, Maharashtra, Delhi, Mumbai and the North-East. Idea acquired 349.20 MHz of spectrum for Rs 12,798 crore in 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz bands and will be able to offer 4G services on its own spectrum across 20 circles, including nine new service areas of Uttar Pradesh (West), UP (East), Gujarat and Mumbai.
Vodafone India, which has emerged as the most aggressive bidder, has acquired spectrum in 1800 MHz, 2100 MHz and 2500 MHz bands for a total cost of Rs 20,280 crore. It has 17 circles with 4G capability.