The empowered group of ministers (EGoM) on telecom on Monday decided to cut the reserve price of spectrum in the the 800-MHz band by up to 50% for the auction in March.

The move is likely to provide major relief to  over 16 million subscribers of Sistema Shyam Teleservices Ltd (SSTL), which operates services under the MTS brand.

If accepted by the Cabinet, the reserve price of 2.5 MHz of spectrum — the minimum  required for beginning operations — would be about Rs.4,500 crore. If SSTL accepts the same, then its users won’t face call disruptions.

The company has more than 1.7 million subscribers of data card.

“All auction will be held in March,” communications and IT minister Kapil Sibal said after the meeting of the EGoM. He also said that the 800-MHz band will be offered for bidding in all circles.

The government will also auction spectrum in the 900-MHz band, supposed to be the premium spectrum, in three metros. Airwaves in the 1,800-MHz band will be offered in four circles.

The government garnered only around Rs.9,407 crore through spectrum auctions held in November last year. It had set a target of about Rs.40,000 crore.