TRAI has given its recommendations for the upcoming spectrum auction, which is likely to take place around May-June this year. It has given its recommendations on spectrum price for seven bands, including 700, 800, and 2500 MHz.
It has suggested Rs.11,485 crore per MHz pan-India base price for premium 700 MHz spectrum - the highest rate for any telecom frequency band - for the next round of auction even as leading operators have sought holding back sale of the radio waves in this band.
The Authority for the first time has suggested the base price for 700 MHz which is considered as the most efficient frequency for high-end mobile services.
In its recommendations on spectrum price for seven bands, including 700 and 800 MHz, the Authority has suggested a base price of Rs.2873 crore per MHz for pan-India 1800 MHz frequency band - widely known as 2G spectrum. The suggested price of 1800 MHz band is about 31 percent higher than the base price fixed by the government in March 2015 auction.
As per TRAI's paper, the cost of delivering mobile services in 700 MHz band is approximately 70 percent lower than in 2100 MHz band, which is widely used for 3G services.
Leading operators had requested the regulator to defer sale of 700 MHz spectrum, saying that ecosystem for providing services in this band was not developed and sale would lead to underutilization of the spectrum for several years and block industry's crucial funds.
The Authority, which had mooted the idea of removing band-wise spectrum holding limits in its draft paper, however, suggested no change in existing rules. The regulator has also recommended auction of all 3G spectrum available with the government at a marginally high rate of Rs.3746 per MHz pan-India against Rs.3705 crore per MHz fixed by the government for the same in March 2015 auction.
The Authority has also recommended auction of 800 MHz band, widely in demand for 4G services, at a base price of Rs.5829 per MHz. The new price is about 60 percent higher than the base price of Rs.3646 crore fixed in the last auction. TRAI has suggested auction of 800 MHz in 19 out of 22 telecom circles.
Earlier, the government had fixed the highest base price at Rs.3980 per MHz for 900 spectrum band in the last auction. The government had fixed Rs.2191 crore pan-India (excluding Maharashtra and West Bengal) price for 1800 MHz band in the previous auction held in March 2015.
As per the recommendation paper, airwaves in 1800 band were available only in seven out of 22 telecom circles. Of the seven circles, it has recommended to the government not to auction spectrum in Bihar, Rajasthan, and North-East due to partial availability of airwaves. TRAI has also recommended auction of spectrum in 900 MHz in six service areas - Gujarat at base price of Rs.673 crore per MHz, Karnataka at Rs.558 crore per MHz, Haryana at Rs.151 crore per MHz, UP East at Rs.776 crore per MHz, UP West at Rs.739 crore MHz, and Bihar at Rs.444 crore per MHz.
The regulator has recommended taking back 1800 MHz band spectrum assigned to Ariel in Haryana and Madhya Pradesh and Tata Teleservices in Himachal Pradesh as well as 800 MHz band spectrum assigned to Tata in West Bengal and Quadrant (Videocon) in Punjab and put these frequencies on auction. The regulator has also suggested base price for 2300 and 2500 MHz bands. It has recommended Rs.817 crore per MHz for spectrum in both 2300