The Department of Telecom (DoT) has kept an open mind on the timing of the next round of spectrum auction and will await regulator Trai's report before firming its views, says a top government official.
The Department of Telecom (DoT) has kept an open mind on the timing of the next round of spectrum auction and will await regulator Trai’s report before firming its views, says a top government official. The Telecom Regulatory Authority of India (Trai) had held an extensive dialogue last week on spectrum auctions with telcos, most of whom are opposed to auctions being conducted in the prevailing scenario given industry’s financial stress, accentuated by falling profits and high levies. The sectoral regulator’s ongoing consultation with the industry was important as it will give an idea about the extent of demand for the radiowaves, the most sought-after bands and the number of players willing to actually take part in the auctions, Telecom Secretary Aruna Sundararajan said. “We will wait for Trai. We will go by their recommendations because they will be able to tell us, after interacting with the industry, whether people want more spectrum, which band, how much spectrum, how many players will be willing to participate in auction. So, (we) will have to wait for Trai’s feedback,” she told PTI in an interview. The telecom department has “kept an open mind on the issue”, Sundararajan said but added that the understanding is that industry is not ready for auctions this year. Last week, after an industry-wide open house consultation, Trai chairman R S Sharma had said the regulator will give its recommendations “as soon as possible”. The sectoral watchdog has, however, not indicated a time-frame in which it will send its final views on the matter to the DoT.
The last spectrum auction held in 2016 had seen a muted response mainly because of high spectrum cost, leading to only Rs 65,789 crore worth of radiowaves being sold against the expectation of Rs 5.6 lakh crore. Nearly 60 per cent of the radiowaves, including premium 4G bands, had remained unsold in that auction. Last year, following a reference from the telecom department, Trai issued a consultation paper on the next round of spectrum auction for bands like 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz and higher bands.
During the recent discussions, many telecom operators asked Trai to keep in mind the distressed financial situation of the industry and spate of consolidation and exits in the sector, while determining the timing of the next round of auctions. The industry has also been in favour of lowering of reserve prices to enable adequate participation and ensuring fair market discovery especially in the backdrop of the sector’s financial woes.