Spectrum auctions: Telcos attend pre-bid conference
DoT asks companies to submit queries by January 15
New Delhi: Telecom firms like Reliance Jio, Bharti Airtel and Vodafone Idea on Tuesday participated in pre-bid conference for spectrum auctions, as the telecom department asked telcos to submit written queries regarding the rules and processes by January 15, according to sources.
During the pre-bid conference, operators raised queries on aspects such as earnest money deposit and roll-out obligations in the bid document, an industry source said. The Department of Telecom (DoT) sources said telcos, including Jio, Airtel and Vodafone Idea, attended the pre-bid conference on Tuesday. The department has now asked the operators to send their written queries on the issues raised at the pre-bid conference by January 15.
The DoT has already released a notice inviting applications for the spectrum auctions in seven bands — 700, 800, 900, 1800, 2100, 2300 and 2500MHz bands, and the bidding is scheduled to begin on March 1. Last month, the Union Cabinet had approved a proposal for the auction of 2,251.25 Megahertz (MHz) of spectrum worth Rs 3.92 lakh crore at the base price.
Telecom operators will need to submit their application by February 5 for participation in the auction. BNP Paribas, last week, had said that spectrum auction in India has turned into a buyer’s market, and may see “minimal competition” with operators going after airwaves that yield the best value for money instead of focusing on renewing all expiring spectrum.
With the countdown now on for spectrum auctions, ICICI Securities had said it expects the final prices across spectrums to be equal to the reserve prices due to significant supply of radiowaves, and likely limited demand for expiring radiowaves.
Telecom industry experts believe that the upcoming auction may not see aggressive bidding. It is more to meet the continuity needs of the industry than any major growth, as some spectrum held by Jio, Airtel and Vodafone Idea is expiring in 2021. The auction will help replenish the same. Notably, the auction does not include 5G spectrum in the 3300-3600 MHz bands.
Both Airtel and Jio are expected to renew their sub-1 GHz holdings and may selectively choose to augment 2300 MHz holdings to build data capacity. Bharti Airtel has 12 MHz / 47 MHz of spectrum expiring across 900 / 1800 MHz bands. At reserve prices, experts believe, it would cost Bharti Airtel Rs 15,000 crore to renew this spectrum, with upfront payment of Rs 6,700 crore. That said, Airtel may not renew all its expiring spectrum. Airtel, it is expected, may consider buying additional 900 Mhz spectrum.
Overall, not much action is expected in the 700 MHz band unless Jio decides to build some capacity for potential 5G rollout this year, say industry watchers. Also, 1800 and 2500 MHz bands may not receive much interest.
