The Telegraph
Thursday , November 22 , 2012
Since 1st March, 1999
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Spectrum price cut on agenda

New Delhi, Nov. 21: The empowered group of ministers (EGoM) for telecom, expected to meet next week, is set to discuss the possibility of lowering the base price of spectrum in four circles — Rajasthan, Karnataka, Mumbai and Delhi — which did not find any takers in the recently concluded auction.

The Telecom Regulatory Authority of India has also been asked to submit a report to the EGoM, chaired by finance minister P. Chidambaram, on “realistic” pricing of airwaves in all bands (1800 MHz, 800 MHz, 900MHz and 700MHz) in view of the current economic conditions and latent demand for radio waves (spectrum).

The government plans to conduct another round of auction in the 1800MHz band before March to find buyers for unsold spectrum. Sale of radiowaves in the highly efficient and much sought-after 900MHz band is also on schedule in 2013.

Telecom operators are lobbying for the new reserve price to be slashed to Rs 3,500 crore, equivalent to that of the third-generation (3G) spectrum sale price two years ago.

Vodafone, which had won additional airwaves in 14 circles in last week’s auctions, said it “firmly believes that the entire spectrum that is currently unused (800MHz, 900MHz and 1800MHz) should be put on auction at the same time with a much lower reserve price”.

Operators also want the government to rethink the decision to peg market-determined spectrum price based on the current auction on future pricing of this scarce resource.