The Big Sale

As the government gears up to roll out the country's largest spectrum auction, debt-ridden telecom players remain unenthused over high reserve prices.

- Prasoon Srivastava

The government is planning to hold one of the country's largest spectrum auctions in the ongoing financial year. The auction will be the biggest both in terms of quantum of spectrum and monetary value of radiowaves.

About 2,300 mhz of spectrum frequencies are being planned to be put up for sale. Their value, according to the base or floor price approved by the Union Cabinet, is estimated to be around Rs 5,66,000 crore. Till date, the biggest spectrum auction was conducted in 2015 which fetched government bids worth Rs 1,10,000 crore. Spectrum in the 700 mhz, 800 mhz, 900 mhz, 1,800 mhz, 2,100 mhz, 2,300 mhz and 2,500 mHz bands will be sold in the upcoming auction.

The upcoming auction will help operators augment expansion of high- speed 4G voice and data services in the world's second-largest mobile phone market by users after China. "This may be the largest-ever auction in the history of the country, and it has been approved," Finance Minister Arun Jaitley told reporters after the meeting of the Union Cabinet headed by Prime Minister Narendra Modi in the third week of June.

SUC hurdle

The government had earlier planned to start spectrum auction in mid-July. But the contentious issue of spectrum usage charge (SUC), the annual fee levied on telecom operators, delayed the auction, which is now likely to take place in September.

Before 2010, there was only 2G spectrum, and hence, the calculation of revenue was easy. But the process became complex after new frequencies were allocated to companies for services, like 3G and 4G.