Day One- Spectrum Auction 2024

The government is auctioning 10,523.15 MHz of spectrum, covering a large chunk of voice and data spectrum, at a reserve price of Rs 96,317.65 crore.

Day One, June 25, saw five rounds of bidding. The bids totaled Rs 11,131.6 crore with 131 MHz across 900, 1800, & 2100 MHz bands. The telcos have shown significant interest in multiple frequency bands, including 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2500 MHz, 3300 MHz, and 26 GHz. On day 1, telcos bought 60.4 MHz spectrum in the 900 MHz band for Rs 7,004 crore, 50.6 MHz spectrum in the 1800 MHz band for Rs 3,614 crore, and 20 MHz in the 2100 MHz band for Rs 546 crore. 2500 MHz was sold in Bihar too.

All unsold spectrums from the previous sale are up for bidding, including the 2300 MHz, 3300 MHz, and 26 GHz bands. Interestingly, the first day, there was no demand for 3300 MHz and 26 gigahertz (GHz) bands, considered ideal for 5G signals.

The spectrum acquired in this auction will be valid for 20 years. Telcos have the flexibility to share, trade, lease, and surrender the spectrum after 10 years. This flexibility is expected to enhance the strategic planning capabilities of telecom companies as they deploy their 5G networks.

Telcos might pay the entire amount upfront to save on interest costs. The interest rate for deferred payments in this auction is 8.65 percent, higher than the 7.2 percent rate in the 2022 auction. Payment options include part payments with corresponding moratoriums or 20 yearly installments, with the first due ten days post-auction. Pre-payment is allowed without penalty.

The bidding will resume today, Day Two, June 26. However, Day One saw the activity level as 90 percent.

CT Bureau