Telecom Spectrum Auction: Bids Worth Rs 77,146 Crore Received On Day 1; All You Need To Know

Telecom Spectrum Auction 2021: With just three big private players in the race, the final results is likely to be announced within a day or two.

Union Minister RS Prasad (PIC/PTI)

Telecom Spectrum Auction 2021: The much awaited auction of spectrum that took place in a span of five years received Rs 77,146 crore of bids on the opening day on Monday with Reliance Jio, Bharti Airtel and Vodafone Idea jostling for airwaves. Over 2,250 MHz of spectrum, that carry telecom signals, in seven bands worth nearly Rs 4 lakh crore at reserve or start price, was offered for bidding in the auction that began on Monday. Also Read:

What’s the bid received?

As per telecom Minister Ravi Shankar Prasad, Rs 77,146 crore worth of spectrum was bid on the first day. However, there were no takers for the airwaves in the premium 700 and 2500 MHz bands. The minister informed the auction will continue on Tuesday

The bids came for 800 MHz, 900 MHz, 1800 MHz, 2100 MHz and 2300 MHz bands. It is to be noted that of the one-third of the spectrum being auctioned is in the 700 MHz band, which was completely unsold during the 2016 auctions.

The lack of interest is mainly because operaters are unlikely to diversify into a new spectrum band because it would entail investment in equipment and when there are sub-GHz bands already available at lower prices, believe experts.

What is expected in the spectrum auction?

Most experts believe that in the absence of 5G airwaves in the auction, the auction will will remain a subdued affair. As per the Economic Times report, of the three private telecom operators, Mukesh Ambani-led Reliance Jio Infocomm has made an earnest money deposit of Rs 10,000 crore, while Bharti Airtel and Vodafone Idea have deposited Rs 3,000 crore and Rs 475 crore respectively.

This amount is important as it signals at the bidding strategy opted by a telecom company during the spectrum auction. Also, the higher earnest money deposited helps the telecom company achieve higher eligibility points, giving it the freedom to bid on more airwaves in different service areas, provided the spectrum in that area is available.

As per the ET report, Credit Suisse has said that Reliance Jio may renew the 44 MHz spectrum bought from Reliance Communication, but also acquire additional spectrum in the 55 MHz spectrum owned by the latter in this auction.

When will the spectrum auction end?

With three big private players in the race, the final results is likely to be out within a day or two. Also, along with these private companies, new companies, including foreign companies have been made eligible to bid for these airwaves. In that case foreign companies need to have to either set up a branch in India and register as an Indian company, or have a tie up with an Indian company in order to retain the airwaves after winning the auction.