The Union Cabinet headed by #NaMo has today approved the telecom commission's proposal for the 2100 MHz reserve price of Rs37.05bn per MHz (vs. TRAI?s earlier suggestion of Rs27.2bn per MHz.) This is 1.6x the pan India 1800 per MHz Feb 2014 auction price. In 2010 the 3G auction per MHz realized price was Rs33.35bn.
In the upcoming auctions, one block of 5MHz contiguous spectrum in the 2100MHz band will be offered for bidding in 17 circles which will enable the operators to provide 3G Mobile Data Services The Ministry of Defense has agreed to swap the 2100 MHz band spectrum with an equal amount of spectrum in the 1900 MHz band. This will give three more 5 MHz blocks pan India. However, this will be put to auction at a later point.
We assume that operators will fill gaps in their existing 3G portfolios by acquiring spectrum in the 2100MHz band. With 4 blocks likely
to be available over the next year, we assume that the operators manage to pick up additional spectrum at the reserve prices.
