In the Open House Discussion for the forthcoming 900MHz and 1800MHz bands auction to be held on 23rd January 2014, India’s largest Wireless Operator Airtel and Second Largest Operator Vodafone strongly objected to the current auction rules where DoT will treat Airtel and Vodafone as new operators in the renewal circles and the upcoming auction rules do not allow retention of the exact quantum of existing spectrum held as new operators can only bid in blocks of 5MHz.
The Scam scarred Congress Led UPA Government drives everything with an hidden agenda as they refused to even discuss the renewal of spectrum after 20 years even though it was part of the original contract with operators. Later Govt hinted that anybody willing to match Spectrum Auction prices would be allowed to retain their existing holding and now they have made it mandatory to bid in Blocks of 5 MHz which makes it impossible to retain the roll-out operators have done.
The auction proposes to treat incumbents whose licences are expiring in Nov/Dec 2014 as new entrants, viz. Airtel & Vodafone in Delhi, Loop & Vodafone in Mumbai and Airtel & Vodafone in Kolkata. Thus these operators will necessarily have to bid for 25 blocks (of 200KHz) in the 1800MHz band, implying that even though the operators may have less than 5MHz of spectrum in 1800MHz band (Vodafone has 2MHz each in Delhi & Mumbai, Airtel has 1.8MHz and 2MHz each in Delhi and Kolkata), they’ll necessarily need to bid for such a quantum of spectrum in the 1800MHz band.
Contiguous Spectrum Block and Fragmentation
In the Gujarat circle, where Airtel doesn’t have 3G or 4G spectrum, there is case for Airtel to bid for 5MHz of contiguous spectrum for data purposes. Vodafone and Idea are the number 1 & 2 operators possessing 3G spectrum, while Uninor & RCom don’t possess 3G spectrum. This could create a demand scenario where, of the 12MHz spectrum, Airtel could end up being declared as a provisional winner in a lesser quantum of spectrum (say 2MHz) owing to more aggressive bids to the tune of 5MHz each by Reliance Communications and Uninor thus leading to fragment which Airtel may not be interested at all.
Allocation of contiguous spectrum for operators winning 10MHz should be re‐considered in ranking rules is another demand the operators have put forth to the DoT.
Looking into the NIA and the issues raised in the open house it appear more to us that the Rules of Spectrum Auction are being Written in South Mumbai and sent to Highly Corrupt DoT / Ministry of Telecom & IT for publishing.