Telecom regulator Trai on Saturday recommended the auction of fourth generation (4G) spectrum that would give internet users much higher speeds on mobile devices and could fetch the next government at least Rs 10,000 crore.
Spectrum in the 800MHz (megahertz) band is a highly efficient radio frequency for data and multimedia streaming, with speeds of at least 100 megabits per second that could go up to as high as 1 gigabit per second.
The Telecom Regulatory Authority of India (Trai) suggested a base price of Rs 2,685 crore per MHz — around 50% higher than the previous pan-India base price. The auction would be held across the country.
The telecom commission will examine Trai’s suggestion and the Union cabinet will have to approve the auction. Sources in the communications ministry suggested this would be held after the new government assumes office.
Mukesh Ambani’s Reliance Jio and Sistema Shyam TeleServices Ltd (SSTL) are the prospective bidders. Last year, SSTL, which offers telecom services under the MTS brand, had paid Rs 3,369 crore for this radio frequency in eight circles.
“The reserve price appears to be on the higher side,” sector analyst Jaideep Ghosh, partner, KPMG India, said.
A 10-day auction of 2G spectrum (900 and 1800 MHz) that concluded on February 13 had fetched the government `61,000 crore. The auction was held after the Supreme Court in 2012 cancelled 122 licences issued during the tenure of former telecom minister A Raja, a key accused in the 2G scam.