Telecom minister Manoj Sinha on Friday said that the failure of the government to get any bids for the ultra-efficient 4G spectrum band 700 MHz in the just concluded auction was due to lack of an ecosystem like availability of equipment and handsets at this point of time. Though industry leaders and analysts have blamed the high price set by the Telecom Regulatory Authority of India for the spectrum at R11,485 crore per MHz as the reason for lack of interest by any operator, Sinha without commenting on it directly said, “We will look at the pricing at the right time, now we are focused on allocating the bandwidth.” He said that this auction cannot be compared to the ones held in the past because this was not for survival but need-based.
The minister said that the auction that concluded on Thursday had more spectrum than the total amount of spectrum put on sale in the past four auctions and this excess supply may have suppressed the ability of the government to gain more revenue. According to Sinha, operators had picked up spectrum to fill up gaps and address instances of call drops. “I hope that the issue of call drops will get over after this spectrum auctions,” he said.
The minister’s comments comes after the government grossed R65,789.12 crore, much lower than its Budget estimates, indicating that operators chose to buy spectrum to fill gaps in their ability to offer 3G/4G services while staying away from the highly-priced 700 MHz and low quantity in 900 MHz.
The government also released the payment terms and the winning bids on Friday. As per the final auction report, Vodafone India emerged as the largest bidder, winning spectrum worth R20,279.3 crore, followed by Bharti Airtel which bought frequencies for R14,243 crore. Reliance Jio and Idea Cellular picked up spectrum for a total of R13,672.46 crore and R12,797.98 crore, respectively, the auction data showed.