Jurisdiction - India
India – Spectrum Auction Raises $9.8 Billion.

25 February, 2014


An auction of regional and nationwide wireless service licenses conducted this month in India proved to be a success, tallying total bids of US$9.8bn that far exceeded initial government estimates of $1.7bn.


Encompassing 45 MHz of spectrum in the 900 MHz band and 403 MHz of spectrum in the 1800 MHz band, the auction ended last Thursday after 68 rounds of bidding that lasted for eleven days. Among the eight participants that qualified, Vodafone India posted the
highest bid total of 196bn rupees (US$3.1bn) for licenses in 11 telecom “circles” that include 23 MHz of 900 MHz band spectrum in Mumbai, Delhi and Kolkata as well as 49 MHz of 1800 MHz spectrum in Mumbai, Delhi, Kolkata and  eight other regions. Reliance Industries, a fast-growing upstart that already holds a national license for wireless broadband services in the 2.3 GHz band, paid US$1.78bn for licenses in 14 regions, as national market leader Bharti Airtel spent $2.98bn to retain rights to existing licenses that are due to expire later this year. Other license winners include Idea Cellular, Aircel, Reliance Communications, and the Indian unit of Telenor. Observers confirm that 82% of the spectrum assets offered in the auction posted winning bids.


The government is expected to collect $2.93bn in total auction deposits by the end of March. Auction winners will be required to pay their balances in annual installments over the next ten years. Declaring, “we have . . . opened the door to the next generation of mobile technology, 4G, by acquiring 1800 MHz spectrum in the places where we expect this market to take off,” Vodafone India CEO Marten Pieters told reporters: “we are pleased to have secured our business for the next twenty years.”


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