Home / Industry / Telecom /  Spectrum auction bids reach Rs1.09 trillion

New Delhi: The government is assured to get an additional 1000 crore, taking the total proceeds from the ongoing spectrum auction to 1.09 trillion, the department of telecommunications (DoT) said on Thursday.

A total of 86 rounds, held over 14 days of bidding, have been completed under the auction, which continues on Friday.

“There is robust bidding going on in 1,800MHz (megahertz) and 800MHz bands. At the end of the 86th round, over 89% of the spectrum has been provisionally allocated to bidders," a statement from the government said. “Majority of service areas are going at a premium over reserve price. The competitive bidding is expected to continue," it added.

According to data published by the DoT at the end of the Thursday, bidding activity seems to be still focused on the 800MHz band, with the price for the spectrum in Delhi becoming the highest among all the circles, exceeding Mumbai.

Excess demand was also seen in Maharashtra and the North-east for the 800MHz band.

Analysts continued to express apprehensions over the amount of leverage that telecom firms will have to take on, and their ability to pass on the increased outgo to consumers.

“In the earlier auctions, the spectrum on offer was either freshly released by the government or became vacant as a result of the order of Supreme Court, while these auctions, especially for spectrum in 900MHz and 1,800MHz bands, are for spectrum which is currently in use by the operators whose 20-year licences are slated to expire in the next few months.

The high bids are therefore not surprising as these operators face the unenviable task of protecting their large investments and revenue streams from these circles for which the auctions are happening," said a report by CARE Ratings on the auctions on Thursday. “CARE Ratings expects that the operators will further leverage themselves, while the consumers will have to bear the brunt of tariff hikes which will become inevitable for the operators to realize returns on these huge investments," the report added.

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